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2019 (5) TMI 1952 - AT - Income TaxAddition on account of the peak cash deposit in his bank account as unexplained investment - assessee derived income from business of dairy products and interest on bank deposits - HELD THAT:- The contention of the AR although deserves to be accepted but in the absence of documentary evidence in support of amount returned to society, the ledger itself filed by assessee cannot be held as sufficient documentary evidence to reach any conclusion. But we find force in the argument raised by assessee that, the assessee is carrying on a small business of dairy products through cash transactions and in absence of any other source of income, the total deposits made in the assessee’s saving bank account can be considered as his business turnover which gets support from the observation of AO for the year under consideration and the AO’s observation in assessment of the preceding year where on identical facts, the trading turnover of “dairy business” of the assessee, cash deposits from cash transactions has been accepted as his business turnover and the profit disclosed in the return was accepted. Cash deposit and withdrawal in the bank account was made regularly by the assessee during the year, it is very reasonable to say that the same was business turnover and therefore only gross profit addition is justified in the facts of the present case. Hence, we are not inclined to agree with the finding of the CIT(A) in observing that of peak cash deposits in bank account, endorsing the observation of the AO which was against the principle of ‘rule of consistency’ on comparison to the preceding Assessment Year and nature of retail milk business of the assessee. In our considered opinion, such deposits in the bank account would certainly constitute business turnover of the assessee and the income disclosed in the return is justified as reasonable business profit for the year under consideration. Assessee appeal allowed.
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