2025 (6) TMI 2149

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....t year 2017-18, disclosing total income at Rs.83,940.00. Thereafter scrutiny assessment proceeding has been initiated on the ground of abnormal increase in cash deposits during demonetisation period. Before the AO, the assessee submitted the bank statements, purchase and sale register, cash book, bank book, month-wise cash deposits with details of deposits made for last two years. It was stated that the deposits in the bank were out of closing cash in hand available in the cash book. However, the AO did not find favour the explanation of the assessee and disallowed Rs.5,01,500/- out of total deposits of Rs.13,68,500/- during demonetisation period by applying section 69A of the Act. Besides, the AO also disallowed Rs.19,360/- i.e. 10% of car....

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....ubsidized govt. PDS kerosene. It is also an undisputed fact that the assessee had deposited the amount for the entire financial year. It is also an undisputed fact that that for the preceding assessment year and succeeding assessment year, the revenue authorities had not disputed the nature of business of the assessee and also in para 7.2 of the order, the ld CIT(A) has categorically mentioned that the assessee was having two business i.e. sale of FMCG products like Nestle, amul and other of distributor of government PDS kerosene. Para 7.2 of the CIT(A) reads as under: "7.2 I have gone through then assessment order and relevant extract of the assessment order is reproduced as under: 2.1 During scrutiny period the assessee ....

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....os.246/Viz/2021 for A.Y 2017-18, wherein, on similar facts, it was held that the sale proceeds are consistently deposited in the bank and the sale made by the assessee and the specified notes deposited by the assessee into the account are legally valid and hence, no addition is warranted on these deposits. The observations of the Co-ordinate Bench are as under: 16. We have heard both the sides and perused the material available on record and also the orders of the Authorities below. Respectfully following the judicial pronouncement in the case of Principal Commissioner of Income Tax vs. Agson Global (P) Ltd., reported in [2014] 134 taxmann.com 256 (Delhi), we note that the cash sales made by the assessee deposited in the bank accou....