2025 (8) TMI 1313 - AT - Income Tax

Cash deposits held unexplained under s.69A but taxpayer allowed presumptive assessment under s.44AD with lump-sum addition

ITAT Delhi - AT held that cash deposits treated as unexplained under s. 69A notwithstanding, the taxpayer was eligible for the presumptive assessment ... Cash deposits treated as unexplained u/s 69A - assessee has been held as eligible for presumptive scheme of assessment u/s 44AD for total sales - HELD THAT:- The only prima facie inference which arises in the given facts is that although the assessee has not been specifically able to explain the direct nexus between his trading results and cash deposits forming subject matter of dispute, the benefit herein of presumptive scheme u/s 44AD could not be altogether denied as well. Thus, as appropriate in the larger interest of interest that a lumpsum addition of Rs. 2,87,500/- herein would be just and proper with a rider that the same shall not treated as a precedent. The assessee gets relief of Rs. 10 lakhs in other words. This appeal against assessment framed under section 143(3) r.w.s. 147 challenges treatment of cash deposits of Rs. 12,87,500/- as 'unexplained under section 69A' despite the assessee being held eligible for the presumptive scheme under section 44AD for total sales of Rs. 17,55,750/-. Tribunal found that, while the assessee 'has not been specifically able to explain the direct nexus between his trading results and cash deposits', the 'benefit herein of presumptive scheme u/s 44AD could not be altogether denied as well.' In the exercise of balancing these factors, a 'lumpsum addition of Rs. 2,87,500/-' was directed, with the explicit rider that the same 'shall not treated as a precedent.' Effectively the assessee received relief of Rs. 10 lakhs. Appeal was partly allowed.