2025 (10) TMI 1296

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....t order passed u/s. 143(3) of the Income-tax Act, 1961 [the Act] dated 20.12.2018 by the ITO, Ward 1, Chitradurga [ld. AO] was dismissed. 2. The assessee is aggrieved and is in appeal. 3. The brief facts of the case show that assessee has filed its return of income on 16.8.2016 at a total income of Rs. 2,72,78. The assessee is a grocery merchant and also a commission agent for agricultural produces. Return was picked up for limited scrutiny to verify the cash deposit and therefore notice u/s. 143(2) of the Act was issued on 21.6.2017. The assessee was found to have deposited a sum of Rs. 88,58,865 in his bank account in cash. In response to the above, the assessee submitted that assessee has a cash balance as on 31.3.2016 of Rs. 27,34....

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.... show that assessee is deriving income from business of selling groceries and also has commission income for sale of agricultural produces. The assessee has also agricultural income. As the assessee has deposited cash into the bank account, the ld. AO found that a sum of Rs. 11,52,165 is unexplained money u/s. 69A of the Act. The assessee stated that it has a closing cash balance as on 31.3.2016 of Rs. 32,14,313, out of which after reducing the drawing and LIC payment, net closing cash balance available with the assessee is Rs. 27,34,800. The ld. AO disbelieved the same and held that assessee should have only the cash balance of Rs. 15,82,635 as on 31.3.2016. He reached the above sum by considering agricultural income of Rs. 3,50,000, cash ....