TaxTMI 
TaxTMI 
2023 (7) TMI 1429
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....holesale basis. The case of the assessee was subject to scrutiny assessment and notice u/s 143(2) of the Act was issued on 11.08.2018. During the course of assessment proceedings the assessing officer pointed out that assessee company had deposited substantial cash in bank account during the demonetization period 09.09.2016 to 30.12.2016 in the financial year 2016-17 relevant assessment year 2017-18. On query, the assessee explained that the amount of cash deposit made during the period 09.11.2016 to 30.12.2016 was out of sales made to various parties. It was also explained that an amount of Rs. 10,00,000/- declared by the assessee under PMGKY scheme, and the amount of Rs. 6,94,00,000/- was pertained to the sales made by the assessee. The AO asked the assessee to provide name/address and PAN of the parties to whom the sales have been made. The assessee explained that it has maintained the complete detail along with PAN of the transactions exceeding Rs. 2,00,000/- and in case sale is less than of Rs. 2,00,000/- from one person/party from which detail of PAN/address is not required to be maintained. The AO had not agreed with the submission of the assessee and obs....
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....unt which are duly audited by Tax Auditor as well as VAT Auditor. The stock remaining after the sales out of purchase have been maintained. Copy of cash statement for FY 15-16 (AY 2016-17). FY 16-17 (AY 2017-18) and FY 17-18 (AY 2018-19) were also made available which is part of submission at page No. 64-69 of Paper Book. Also Copy of Stock Statement for AY 2016-17, 2017-18 and 2018-19. and copy of monthly purchase and sales chart for existing and previous year are also provide. If assessee has maintain books of account depicting the generation of cash and has shown that the cash received from customers has been deposited in bank account, the cash deposit cannot be treated as unexplained. On examining the book results of the assessee, following state of affairs emerges. The total sales and cash sales have increased from previous years sales: A.Y. Total Sales less VAT Cash Sales GP Rate 2016-17 1,69,29,51,602 6,95,91,355 1.05% 2017-18 2,41,79,75,146 8,32,34,729 0.90 During the immediately previous AY 16-17, assessee has made total sales of Rs. 169.29 crore of which mere Rs. 6,95 cr. was made in cash. Such a small percentage of cash sales ....
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.... money, bullion, jewellery or any other valuable article and same is not recorded in the books of account, it can be considered to be deemed income of the assessee in case he is not able to provide explanation or his explanation is not satisfactory in the opinion of the Assessing Officer. In the present case the same cannot be applied where the assessee has himself declared the amount of cash deposits in the return of income after duly entering the same in the books of account. The provisions of Section 69A of the Act cannot be applied in respect of cash deposits which have been duly recorded in the books of account and have already been considered as income in the return of income filed by the assessee. In assessee's case the assessee has duly recorded the cash sales of Rs 6,92,00,000/- in his books of account and has also considered it as income in the return of income and taxes have also been paid on the said amount. The onus is on the AO to prove the cash deposits are not part of sale consideration There is nothing in the assessment order to suggest that assessee was in possession of bullion which was unexplained. Thus as per above explanation the provisions of above sectio....
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....so placed reliance on the number of judicial pronouncements referred in his written submission as. (i) ACIT Vs. Hirapanna Jewellers, ITA No. 253(Viz) of 2020 dated 12.05.2021; (ii) Easy Pay Pvt. Ltd. Vs DCIT Circle 2(1)(1) High Court of Gujarat; (iii) PCIT Vs. Adamine Construction (P) Ltd; (iv) Bajaj Sons Ltd. Vs. DCIT, ITA No. 1127/Chd/2019 dated 24.05.2020; (v) Hari Narain Gattani V. DCIT, ITA No. 186/JP/2020 dated 09.10.2020; (vi) PCIT Vs. Bajargan Traders High Court of Rajasthan; (vii) ACIT Vs. Rahil Agencies, ITA No. 4413/Mum/2014; (viii) ITO Vs. Surana Traders IT Appeal No. 4096 (Bom) of 1999; (ix) New Pooja Jewellers Vs. ITO, Ward -44(3) ITA No. 1329/Kol/2018; (x) Pr.CIT. Vs. Agson Global (P) Ltd. IT Appeal Nos. 68 to 73 of 2021. 5. The ld. Counsel has supported the detailed findings of the Ld. CIT (A) and submitted that assessee has filed sales and purchase details from sale register, purchase register, sales and purchase invoices stock register, etc., however, AO has not disproved with any relevant evidences the claim of the assessee that source of cash deposit was made out of sale of the assessee company. 6. Heard both the sides and pe....
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....ich showed in assessment year 2016-17 the percentage of cash sale to the total sale was 4.11% whereas during the assessment year 2017-18 it had come down to 3.44% which showed that during the year under consideration compared to earlier year there was no abnormally high cash sale made by the assessee. In the paper book the assessee has placed copies of document filed during the course of assessment proceedings. The assessee has filed the details alongwith explanation i.e copy of stock statement for the A.Y. 2016-17 to A.Y. 2018-19, copies of stock statement for the A.Y. 2016-17 to A.Y. 2018-19, copies of cash statement for AY. 2016-17 to AY. 2018-19, copies of monthly purchase and sales for the year under consideration and the previous year, copies of month wise purchase register, copy of month wise sale register, copy of name, address and PAN of purchase above Rs. 2,00,000/- copy of name address and PAN of sales above Rs. 2,00,000/- copies of sale bills etc. The assessee has also placed at pages 126 to 135 of the paper book, copies of replies filed before the AO dated 20.06.2019, 29.11.2019, 3.12.2019 and 18.12.2019 respectively. The assessee has given the detail of cash....
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....sh deposit in the bank account during the demonetization. 8. We have perused the decision of Hon'ble High Court in the case of Agson Global Pvt. Ltd. Vs. Pr.CIT wherein held as under: "INCOME TAX: Where AO made addition under section 68 on account of cash deposit made by assessee post-demonetization, since assessee placed material on record to prove that cash deposits made with banks were in correspondence with cash sales and growth in sales compared to earlier two years showed similar trend, it could only be concluded that there was growth in assessee's business and impugned addition was to be deleted." After considering the facts and circumstances and finding of various courts we find absolutely no prima facie material to take contrary view and the ld. CIT (A) has rightly considered the material placed before him. The A.O has not brought on record any clinching evidences to prove that cash sale made by the assessee was not genuine as the same was supported with corresponding purchases relevant bills and invoices and stock position as discussed supra in this order. 9. We also find that ld. CIT (A) has rightly held that Sec. 69 provides that in case the assessee is found ....