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2023 (10) TMI 1366 - AT - Income TaxAddition u/s 68 - cash deposit in the bank account - rejecting the book of accounts - AO estimated the GP after reducing the amount of cash deposit from turnover - assessee during the demonetization period made cash deposit in the bank account - assessee submitted that cash has been deposited out of sale proceeds which were duly recorded in the books of accounts which were duly audited by the independent auditor, supported by the bills and voucher, purchases and stock register, cash book, bank book etc. HELD THAT:- We find that the assessee has maintained proper books of account and furnished details as required by the A.O. except the details of the stock in the desired format. The details submitted by the assessee include audited financial statement, details of the purchases, gold stock summery and other information about the sales, GP of different years which are available in the paper book filed before us. In these documentary evidence no defect was pointed out by the AO except non-maintenance of stock register in the desired format. Therefore, without bringing any corroborative material on record suggesting specific defect in the books of account the book result cannot be rejected merely for not providing certain detail which the AO requires to verify. See AWADHESH PRATAP SINGH ABDUL REHMAN AND BROTHERS [1993 (12) TMI 28 - ALLAHABAD HIGH COURT] AO after rejecting the books accounts has proceeded to treat the cash sales as unexplained cash credit u/s 68 of the Act on various grounds. AO has relied upon the same set of data/figures as shown by the assessee for treating the cash deposit as unexplained cash credit u/s 68 of the Act. There was no iota of doubt on the genuineness of the other income and the expenses was brought on record by the assessee. To our mind, once the books of accounts have been rejected, the AO has to estimate the profit and he has no right to make any individual addition or deletion to the total income of the assessee. However, in the case on hand, the AO has not done so. See HYNOUP FOOD & OIL INDUSTRIES (P.) LTD. [1992 (2) TMI 111 - ITAT AHMEDABAD-A] Therefore, we hold that the book result shown by the assessee in the given facts and circumstances has to be accepted. Accordingly, we set aside the finding of the learned CIT-A and direct the AO to delete the addition made by him. Decided in favour of assessee.
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