Section 68 cash deposit addition deleted where cash book and stock register remained defect-free during demonetisation.

Cash deposits made during the demonetisation period were explained by the assessee's cash book, and no defect was found in the cash book or stock register. The Revenue's relied-upon entries did not show manipulation, as they related to a period before demonetisation and matched earlier and later ledger records. On these facts, the addition under section 68 was held unsustainable and was deleted in favour of the assessee.

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Issues: Whether the addition made under section 68 on account of cash deposits during the demonetisation period was sustainable when the deposits were explained as having come from the assessee's cash book and no defect was found in the cash book or stock register.

Analysis: The cash deposits were found to be supported by the assessee's cash book. The entries relied upon by the Revenue did not indicate manipulation, as they related to a period before demonetisation and were consistent with earlier and subsequent ledger entries. The cash deposits were also shown to be substantially consistent across the relevant years, and no error was found in the cash book or stock book maintained by the assessee.

Conclusion: The addition under section 68 was held to be unsustainable and was deleted, in favour of the assessee.

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