TaxTMI 
TaxTMI 
2026 (9) TMI 1958
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.... play. 2. That the assessing officer has erred in law and on the facts by adding a sum of Rs. 80,43,000/- being cash deposits without considering the fact that the sum of Rs. 53,93,000/- was deposited out of the land advance amount repaid by the farmers and balance was by way of re-deposit of the money already withdrawn from banks. 3. That the assessing officer erred in not appreciating the facts that the appellant had received an advance amount of Rs. 7,74,56,250/- during the year 2020-21 for purchase of agriculture land from various parties and treating the said advance amount as appellant's gross income. 4. That the assessing officer erred in law and on the facts by adding the sum of Rs. 12,00,000/- as income based on the GST return figures in-spite of the appellant submission that the difference of Rs. 12,00,000/- was due to revised contract bill and they could not file a revised GST return as there was no provision to file revised return in the GST portal. 5. The Appellant reserves its rights to add, alter, delete, substitute or otherwise the above grounds of appeal before or during the hearing of appeal. 3. The appeal was first fixed....
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.... further amount of Rs. 26,50,000/- was deposited in the Axis Bank account of Fahad Car Fantasy. The aggregate cash deposits were thus Rs. 80,43,000/-. 8. The assessee explained that Rs. 42,06,500/- represented recovery of an advance from Shri Ramesh Haridas Katkari, a farmer who had withdrawn from a proposed land transaction. In relation to the remaining deposits in the first two accounts, the assessee stated that ordinary business cash withdrawn earlier had been redeposited as and when funds were required in the bank. An affidavit dated 15.12.2022 of Shri Katkari was filed. The affidavit, however, referred to a refund of Rs. 42,06,000/- and did not state the date or mode of the original advance or the dates and particulars of the alleged cash refunds. Shri Katkari also did not respond to the notice issued under section 133(6). The assessee did not produce proof of the original payments, a cash book, or a deposit-wise cash trail. No income from the car-sales concern in whose account Rs. 26,50,000/- had been deposited was disclosed for the year. 9. The Assessing Officer held that the explanation did not establish the nature and source of the deposits and treated Rs. 80,43,000/....
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....the identity of the customer, the contract, invoices, ledger accounts, correspondence showing rejection of the work or invoice, or any GST reconciliation or correction. The amount of Rs. 12,00,000/- was consequently added as undisclosed sales. 13. The appeal was preferred before learned CIT(A). No additional evidence was furnished. The appeal was decided on the basis of the written submissions and the material available on the assessment and appellate portals. 14. The challenge based on natural justice was rejected because the assessment order dealt with the assessee's business model and the material furnished, several statutory notices and show-cause notices had been issued, replies had been considered, and a final opportunity had also been granted. The Commissioner of Income Tax (Appeals) held that mere non-acceptance of the explanation did not make the assessment order non-speaking. 15. The addition of Rs. 80,43,000/- was confirmed since the affidavit did not contain material particulars capable of connecting the alleged refund with the cash deposits, the person said to have made the refund did not respond to the notice under section 133(6), and no cash book, bank-w....
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....egating to Rs. 80,43,000/- was deposited. He also stated before the Assessing Officer that no separate cash book was maintained. The decisive question is therefore whether the explanation offered is supported by material establishing the source and the link between that source and the deposits. 19. As regards the alleged refund from Shri Katkari, the explanation was of Rs. 42,06,500/-, whereas the affidavit spoke of Rs. 42,06,000/-. More importantly, the affidavit did not disclose when and by what mode the original advance was paid, when the amounts were refunded in cash, or how those refunds corresponded to the dates and amounts of the deposits in the bank account. The explanation also does not arithmetically reconcile with the deposits: Rs. 42,06,500/- stated to be the refund and Rs. 12,00,000/- stated to be business cash aggregate to Rs. 54,06,500/-, whereas the deposits in the first two accounts aggregate to Rs. 53,93,000/-. The assessee did not produce the banking evidence of the alleged original payments or a contemporaneous account showing the receivable and its recovery. The non-response to the notice under section 133(6), though not by itself conclusive against the asse....