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2023 (3) TMI 1196 - AT - Income TaxAddition u/s 68 r.w.s. 115BBE - unexplained cash deposited in bank - Non rejection of books of accounts by revenue - HELD THAT:- In the present case, the department has not rejected the books of accounts of the Assessee accepted in VAT. The regular books of accounts were maintained in the normal course of business in which no flaw, fallacy or deficiency was pointed out by the AO. It is well settled law that once the assessing officer accepts the books of accounts and the entries in the books of accounts are matched, there is no case for making the addition as unexplained. AO and the ld CIT(A) have concluded the findings on the basis of conjectures and surmises. AO has to establish the link between the evidence collected by him and the addition to be made. The entire case has to be dependent on the Rule of evidence, the assessee in this case explained the source of bank deposits are from cash sales. AO proceeded to disbelieve the explanation of the assessee on the presumption basis without bringing the corroborative material on record. AO is required to act fairly as reasonable person and not arbitrarily capriciously. The assessment should have been made based on the adequate material and it should stand on its own leg. AO without examining any parties to whom the goods are sold by the assessee, came to conclusion that the sales are not genuine, without even rejecting the books of account which is in our opinion is erroneous - Decided in favour of assessee.
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