Assessee's unaccounted sales were estimated based on notebooks,...

Assessee's unaccounted sales were estimated based on notebooks, diaries, and WhatsApp conversations. Only real income can be taxed. While unaccounted sales existed, corresponding unaccounted expenses were also incurred. AO cannot accept part of the transaction. CIT(A) estimated profit by applying regular GP rates, which is logical and reasonable. Circular transactions within group entities lack the character of income and should be excluded from unaccounted sales receipts estimation. Bogus expenditure disallowance at 12.5% is reasonable to plug revenue leakages. Unaccounted cash receipts additions for certain years based on unsigned excel sheets lack evidentiary value without corroboration. Additions based on notebooks seized from a non-employee were reasonably estimated by applying GP rates. Email communication suggesting accounting adjustments cannot be presumed as manipulations without corroboration, especially when accounts were audited without adverse remarks. Relevant legal principles were applied in estimating real income and making reasonable additions/disallowances.