TaxTMI 
TaxTMI 
2026 (6) TMI 815
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....over" and estimating income @5%. instead of upholding the addition made u/s 68 r.w.s. 1158BE? 2. Whether the Ld. CIT(A) has erred in law in accepting additional evidence (affidavits, cash-flow statements) without ensuring satisfaction of the mandatory requirements of Rule 46A, and without proper verification of identity, creditworthiness and genuineness of alleged truck owners? 3. Whether the 1d.CIT(A) has erred in applying the principle of estimation of income in absence of books of account, when the statutory presumption under Section 68 'mandates addition of the entire unexplained cash credit? 4. Whether the 1d.CIT(A) has erred in law by relying on an unrelated third-party case (Shri Pradeep Singh. AY 2009-10) without establishing factual similarity or comparability, thereby ignoring the specific facts and failures of the present assessee? 5. Whether the Ld. CIT(A) has failed to appreciate that the assessee did not cast under Section 68 to prove the nature and source of the cash deposits, and therefore the AO was justified in treating the entire amount as unexplained. 6. Whether the 1d.CIT(A)'s action of granting relief without proper....
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....was found that the assessee has made financial transaction of amounting to Rs. 3,76,59,000/-during the FY 2012-13 relevant to AY 2013-14. Accordingly, the notice u/s 133(6) of the Act was issued to the branch manager of HDFC bank, Muzaffarnagar after obtaining approval from the competent authority and called for bank statement of the assessee for the FY 2012-13. On perusal of the bank statement of the assessee, it was seen that the assessee has deposited cash on various dates in his bank account maintained with HDFC bank, Muzaffarnagar during the year under consideration but not filed ITR for the A.Y. 201314. The analysis of banking statement of the assessee confirmed that the source of cash deposit amounting to Rs. 3,76,59,000/- remains unexplained and undisclosed income of the assessee. Accordingly, the notice u/s 148 of the Act was issued to the assessee on 31.03.2021 and duly served to the assessee. In response, the assessee filed return of income on 17.02.2022 declaring a total income of Rs. 1,94,150/-. Subsequently, the notices u/s 143(2) and 142(1) of the Act were issued and the assessee responded and filed submission as per requirements from time to time. During the course ....
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....nt and cash flow statement of the assessee, it has been gathered that the assessee has received commission of amounting to Rs. 3,76,600/- @ 1% while making payments of Rs. 3,76,60,082/- to the truck owners as freight received from the clients and paid the balance to the petrol pump and spare parts shops owners. On perusal of the bank statement of the assessee, it has also been noticed that the assessee has received payments of Rs. 3,75,29,007l- and the same was paid to the owners of filling stations as well as to the spare parts shop owners. Also, cash flow statement of the assessee for the year ended 31st March, 2013 reveals that the opening balance was at Rs. 1,20,000/- and the assessee received payments from the clients/parties in cash at amounting to Rs. 3,76,59,000/- and cheque of Rs. 1,22,029/- which comes to a total of Rs. 3,79,01,029. On the other side, the assessee has made payments to truck owners at amounting to Rs. 3,74,04,429/- and balance amount has been shown as expenses, drawings, cash in hand and cash at bank. Thus, the both sides of cash flow statement have been equally shown at amounting to Rs. 3,79,01,029/- which is apparent from the records. In addition, the as....
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....y regular books of accounts and supporting documents to claim lower profit as admitted by the appellant. 5.3. Therefore, considering the facts and circumstances of the present case, and in the interest of justice and consistency with the treatment accorded in the Pradeep Singh case, the Assessing Officer is directed to estimate the appellant's profit by applying a rate of 5% of the turnover (i.e., 5% of Rs, 3,76,59,000), and to assess the income accordingly. The addition made under section 68 r.w.s. 115BBE is to be restricted to the profit so estimated, and the balance is to be deleted. 6. In the result, the appeal is partly allowed...." 5. The ld. Sr. DR vehemently argued in favour of the order of the ld. AO and submitted that no Return of Income was originally filed by the assessee neither were the accounts audited. It was submitted that it was intriguing that all the cash deposits were made in the Muzaffarnagar bank branch only. The ld. DR therefore argued that the estimation of 5% profit in respect of total cash deposits of Rs.3,76,59,000/- was thus faulty. 6. Upon consideration of the order of the ld. AO, we have noted that the ld. AO has not disput....
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.... 1. That, the assumption of jurisdiction U/s 147 and issuance of notice U/s 148 is illegal, bad in law and without jurisdiction and barred by time limitation. 2. That the order passed under section 147 is illegal, bad in law, without jurisdiction and against the material available on record. 3. That the NFAC has erred in law and on facts in estimating the G.P. @ 5 % of the total amount deposited at Rs.3,76,59,000.00 in the bank account and sustained the addition of Rs.18,82,950.00, which is highly arbitrary, unjustified and baseless. 4. That, the NF AC has erred in restricted the addition of estimation of profit U/s 68 r.w.s. 115BBE of the ACT, which is highly arbitrary, unjustified and against the facts and circumstances of the case. 5. The addition made and the observations made are unjust, unlawful and based on mere surmises and conjunctures. The additions made cannot be justified by any material on record. 6. That the explanation given evidence produced, material placed and available on record has not been properly considered and judicially interpreted and the same do not justify the additions/ allowances made. 10. Heard ....