Export sale proceeds already taxed as turnover cannot be reclassified as unexplained cash credit when realised later.

Export sale proceeds that had already been recorded as turnover and taxed in the earlier year were not taxable again as unexplained cash credit under section 68 when received later. The assessee supported the remittance with export and commercial invoices, customs-verified shipping documents, bills of lading, bank advices and FIRCs, showing that the amount related to genuine export sales already accepted in the preceding assessment year. On those facts, the later receipt was treated as realisation of an existing trade debt, not a fresh unexplained credit, and the addition under section 68 read with section 115BBE was deleted.

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Issues: Whether the credit of Rs. 91 lakhs representing realization of export sale proceeds, already recorded as turnover and offered to tax in the immediately preceding year, could be assessed as unexplained cash credit under section 68.

Analysis: The assessee produced export and commercial invoices, customs-verified shipping documents, bills of lading, bank advices and FIRCs to show that the remittance was linked to genuine export sales made in the earlier year. The same export turnover had already been accepted in the preceding assessment and taxed as business receipts. On those facts, the receipt during the year under consideration was only realization of an already accounted trade debt and not a fresh unexplained credit. A sum that is referable to an accepted export transaction cannot be brought to tax again as unexplained cash credit merely because the remittance was received later.

Conclusion: The addition under section 68 read with section 115BBE was deleted and the assessee succeeded on the merits of this issue.

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