TaxTMI 
TaxTMI 
2026 (6) TMI 357
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....etization period. Assessee had furnished necessary information and documents called for but assessing officer was not satisfied and concluded as follows: "The reply of the assessee is considered. It is found assessee has not submitted any explanation in respect steep high cash sale in the months of October and November (in first week only) 2016. Further why assessee has kept Rs. 198226543 with himself without depositing it in the bank account where as it was doing other regular banking transactions during this period. Assessee was incurring interest expense and having several other expense pending. Income of the assessee as per his ITR is only Rs. 64,93,410 and as such he can't leave his cash sale balance of Rs. 19,82,26,543 unused. As such reply of the assessee is found without any merit and as such the same is rejected. After examination of reply of the assessee and facts of the case observation of assessing officer in this case is given here under:- "6.1 Statement for the F.Y. 2014-15, 2015-16 & 2016-17 regarding cash sale and cash deposited in the bank account has been obtained. The statement is here under:- 2014-15 2015-16 Month Cash....
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....nd when he is paying interest paid to bank O/D a/c amounting to Rs. 1,52,845/- and on car loan Rs. 63,112/-. At the same time claim of the assessee that he kept his cash balance of Rs. 19, 82, 26,543/- without depositing the same in bank account is not acceptable. It is also found that assessee was doing regular bank transaction during the month of October, 2016 yet he was not depositing his cash balance in the bank account. Conclusion 7. On the basis of observation drawn at Para No. 6 above, assessing officer reached to a conclusion that concocted cash sale has been booked by the assessee to adjust his undisclosed income during the demonetization period. 7.1 Assessee was having sufficient stock which he has pretended that he has sold and cash received from the sale is deposited in the bank. This connotation of the assessee is not accepted because no business man will keep cash in hand while he has to pay interests on loans as well as other expenditures are pending. Therefore it is held that part of the cash deposit made by the assessee is his unaccounted cash amount which he was forced to deposit in his bank account because of the decision of Govt. of In....
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....ad made cash deposit Rs. 26,89,50,000/- in its bank account. The appellant contented that the cash deposits is out his cash on hand and from the cash sales which is mainly in the month of October and November, 2016 as the festival session like Diwali, Bhai Dhuj and Dhanteras. All these festivals are auspicious in buying and gifting jewellery items. Further, the appellant submitted that the cash sales for the year under consideration is much less than the last years sale which is Rs. 118 Crs. as compared to this year's sale which is around Rs. 26 Crs. Further, the appellant submitted that the amount of sale and purchase entered in the books of accounts tallied with VAT returns, thus authenticity of sales and purchases made by the appellant during the year under consideration cannot be doubted. On perusal of cash ledger submitted by the appellant, it is substantiating that the appellant had sufficient cash balance as on 08.11.2016 i.e. of Rs. 26,93,49,391/- for depositing the cash into the bank account and all the cash sales made by the assessee during the month of October, 2016 had been duly recorded in the books of accounts. There is no dispute as to availability of stock, cash....
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....ere no sales except these months during the AY 2017-18. Further, the appellant has not submitted cash books for AY 2018-19 which can substantiate the reasons of the appellant. Actually, the appellant has made a concocted story to justify the cash deposited during the demonetization period. 7.5 From, the above narrated facts, it is obvious that the appellant had not made any cash sales but it is an afterthought which appellant has applied to justify the cash deposited during the demonetization period. Therefore, the AO was right to hold that the appellant had not maintained his books of account properly and manipulated his accounts, therefore, rejected the books of accounts. Further, since, the addition has been made u/s 68 of the Act on account of cash credits. The provisions of Sec. 115BBE were held to be applicable from the assessment year 2013-2014. This section is contained in Chapter XII of the Income Tax Act, 1961. The title of the section is "Tax on income referred to in section Sections 68, 69, 69A, 698, 69C or 69D -the specified sections. Any income falling under the above said section shall be subject to tax at a flat rate of 30%. This section has been amended by....
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....that cash deposits were made out of cash sales which were already recorded in the books of accounts, and any further addition by the AO will lead to double taxation of the same amount in the hands of the assessee. 6. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the abovesaid addition despite the fact that the same has been made by the AO by rejecting the books of account of the assessee, without pointing out any specific defect as contemplated under section 145(3) of the Income Tax Act. 7. On the facts and circumstances of the case, the learned CIT(A) has grossly erred both on facts and in law in confirming the above addition despite the fact that addition has been made by the AO, without pointing out any defect in the evidences furnished by the assessee during the assessment proceedings. 8. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the action of AO despite the fact that the assessee has been maintaining proper books of accounts and cash sales were made out of the purchases that have not been doubted and rejected by the ....
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..... Neeraj Kumar Prop. M/s Neeraj Metal and (vice-versa) 2025 (2) TMI 290 dated 06.02.2025 (ITAT Delhi); Shri Kamal Sharma Vs. DCIT, Central Circle-II, Faridabad 2024 (10) TMI 1628 dated 24.10.2024 (ITAT Delhi); Gorja Steel Processors, Vs. DCIT, Central Circle, Ghaziabad, ITAs, No. 2905 to 2907/Del/2022 dated 08.10.2024 (ITAt Delhi); Pr.CIT-7 Vs. R.G. Buildwell Engineers Ltd. 2017 (12) TMI 1614 dated 22.12.2017; Pr.CIT-7 Vs. R.G. Buildwell Engineers Ltd. 2018 (10) TMI 252 dated 01.10.2018 (SC); Shri Mukesh Gupta Vs. The DCIT-6 (1)(2), Bengaluru 2023 (1) TMI 174 dated 05.12.2022 (Karnataka HC); Anupam Industries Ltd. Vs. ACIT, (2025) 180 taxmann.com 678 dated 17.11.2025 (ITAT Ahmedabad); ITO, Ward 4 (1)(1) Ahmedabad Vs. Shri Govindam Agro Foods Pvt. Ltd. Ahmedabad 2025 (11) TMI 1837 dated 07.11.2025 (ITAT Ahmedabad); Pr. CIT Vs. M/s Remfry And Sagar (2025) (10) TMI 1064 dated 15.10.2025 (Delhi HC). 6 Ld. DR has primarily relied the relevant observation of assessing officer which are also supplemented by observations of Ld. CIT(A). 7. We have given thoughtful consideration in the material on record and what immediately strikes are the findings of Ld. CIT(A) that the genuineness o....