TaxTMI 
TaxTMI 
2026 (3) TMI 1121
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.... to the facts and circumstances of the case, the Ld. CIT(A) has grossly erred in law and on facts in not appreciating the material documents placed on record during the proceedings which relevant for the present case controversy. 3. That having regard to the facts and circumstances of the case, the Ld. lower authorities has grossly erred in law or on facts in alleging that no documentary evidences has been submitted whereas, the Appellant has filed the documentary evidences such as VAT returns Cash Book, Confirmation, Stock details month wise purchase and sale details etc. to substantiate the sales given during the year out of which cash was deposited in bank accounts during demonization period. 4. That having regard to the facts and circumstances of the case, the Ld. lower authorities has grossly erred in law or on facts in making addition on account of cash deposited in bank account without rejecting the books of account. 5. That having regard to the facts and circumstances of the case, the Ld. lower authorities has grossly erred in law or on facts in doubting the cash sales disclosed in books of accounts of the appellant which were duly audited by the ....
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.... the Act. 4. Aggrieved the order of the AO the assessee filed the appeal before the Ld. NFAC who vide his order dated 25-06-2025 dismissed the appeal of the assessee. The Ld. NFAC has observed in order as under: 6.3 I have gone through the grounds of appeal, assessment order as well as the appellant submissions. It is submitted by the appellant that the nature of cash deposited is nothing but admitted cash sales made by the appellant during the year under consideration and out of permissible cash collection from the customers. However, the appellant has not filed any documentary evidence in this regard. It neither filed the list of persons from whom the cash has been collected during the financial year 2016-17 relevant to the A.Y.2017-18 to prove that the cash deposited in the bank account are noting but collections. It is correctly held by AO that the assessee failed to discharge the onus vested on him by not filing confirmations other documentary evidence in support of the claim that the cash includes opening balance and it received cash from the other parties being customers in the business. It was submitted that the appellant had withdrawn cash immediate before demo....
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.... in appeal before the Tribunal. 5. The ld. AR of the assessee has submitted that the preceding year which is 2016-17 was the first year of business of the Assessee. The total cash sales ratio in both the year is similar. The Gross profit ratio and net profit ratio is similar. He further submitted that in in the month of October the cash sales was higher due to festival seasons. The assessee maintained proper book of account which are being subjected to audited, and filed during the proceedings. He also submitted that the ratio of total cash sales and total cash deposits in the both years are similar. The assessee has given the chart in the written submission of the cash sales ratio and the cash deposit of the both years. The given chart reproduce as under: The ratio of total cash sales and total cash deposits in both the years are similar: A.Y. Total Cash Sales Total Cash deposits Percentage of cash deposits 2016-17 10,60,616/- 10,20,000/- 96% 2017-18 57,87,549/- 53,55,000/- 92& The total cash sales ratio in both the years is also similar: A.Y. Total Sales Cash Sales Percentage of cash sales 2016-17 29,39,723/- 10,60....
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....ome Tax Officer In ITA No. 144/Del/2023 (iii) S. Balaji Mech-Tech Private Ltd. vs. ITO in ITA No.556/Del/2024 (iv) Commissioner of Income Tax vs. Kailash Jewellery House In ITA No. 613/2010(High Court Delhi) 6. Ld. DR has submitted that the documents filed by the assessee was not found satisfactory by the AO. There was unusual and unexplained increase in cash sales before the demonetization period when it was compared to earlier year. It is true that books of account was not rejected by the AO, but the addition was made the unexplained cash deposit during the demonetization period. The audited books of account does not itself prove the genuineness and correctness of the cash sales. He further submitted that during the examination of the documents the AO found that total cash sales from April,2016 to September 2016 amounted to Rs. 14,07,743/-. Whereas a sudden and substantial increase of Rs. 40,72,781/- was found in the month of October, 2016. The assessee has failed to substantiate his claim before the lower authorities. 7. We have heard the parties and perused the material available on records. There is material substance in the submission made on behalf of....
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....es are not abnormal. 20. Whether the recording of cash sales which is already declared in the books of account will attract the deeming provisions of sec.68 or 69A of Act. We observed that the assessee has declared all the cash transactions in its books of account and merely because the cash deposits are more during the demonetization period, whether the CIT(A) can invoke the provisions of section 69A of the Act. As per provisions of the section, it is necessary that the assessee be found with the money, the same is not recorded in the books accounts maintained by it for any source and not offers any explanation or Page such explanations are not found to be satisfactory to the AO. In this case, the assessee has already declared the cash sales in its books of account and offers the explanation as cash sales, which the lower authorities has accepted it as regular business transactions because they have not rejected the book results and brought to tax the total sales declared by the assessee in its books. Since the cash were already recorded and explanation is already part of the book results, there is no avenue for the CIT(A) to reject such explanations. This expression "exp....