2026 (5) TMI 1552

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....7 of the Act pertaining to Assessment Year 2011-12. 2. Brief facts of the case are that the assessee is an individual, filed his return of income on 18.02.2012, declaring total income of INR 1,59,845/-. The AO had information that assessee has two bank accounts in which he had made cash deposits of INR 9,11,38,235/- in Axis Bank, Karol Bagh, New Delhi and INR 2,41,03,076/- in Indusind Bank, Ashok Vihar, New Delhi and since the income declared by the assessee was not commensurate with the cash deposited in the bank account, the case of the assessee was reopened by issue of notice u/s 148 after recording the reasons and approval from the competent authorities. Thereafter, the AO had made the addition of INR 11,52,41,311/- being cash deposi....

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....uch approval is granted electronically." 7. As per the aforesaid section, the approval granted under the Act shall be deemed to be administrative and supervisory in nature and shall not be invalid by reason of any insufficiency of the reasons recorded or by reason of any defect in the form or manner of its authentication or communication and shall be treated as administrative approval. In view of this section, the contention of the assessee regarding defective approval cannot be accepted and therefore, all the additional Grounds of appeal taken regarding re-opening of assessment are dismissed. 8. Coming to Ground of appeal Nos. 6 to 9 raised by the assessee which are taken against the merits of the additions. 9. Ld.AR for the asses....

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....f business which has not been rejected before making the additions on account of cash deposited. Ld.AR submits that AO has made an error or fact wherein on one hand, it has accepted the turnover of the assessee and further added the cash generated from the said sales which was deposited in the bank account. Ld.AR alternatively submits that in the given circumstances, a reasonable G.P. rate could be applied though the books of accounts of the assessee were not rejected. 10. On the other hand, Ld. CIT DR vehemently supported the orders of the AO and submits that the assessee has failed to explain about the modus-operandi of the new business of trading in mobile phones when his statements were recorded by the AO. As per Ld. CIT DR that asse....

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....laced in the Paper Book filed before us. It is further observed that the assessee has got his account audited and the audited financial statements and tax audit report are placed at pages 157 to 168 of the Paper Book, which were never doubted by the AO. It is observed that assessee has turnover of more than INR 15.00 crores however, the income declared was around INR 1.5 Lakhs only. This creates doubts in the minds of the lower authorities as the assessee was having cash deposits of more than INR 11.00 crores in the bank. 12. It is observed that assessee has made sales and all the bills and vouchers were submitted. The purchase invoices and the import details were submitted as stated above. The AO has failed to point out any error in suc....