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2018 (2) TMI 295 - AT - Income TaxAddition on account of cash deposit in bank - application of gross profit ratio - Held that:- Considering the nature of transaction as reflected in the bank statement we note that every deposit has been represented by the withdrawals of the similar amounts. Therefore we hold that all the transactions of the assessee in the bank accounts are representing the business activities of the assessee therefore in our considered view it would be appropriate to apply the gross profit ratio on the cash deposit in the impugned banks. Also observed that in the subsequent assessment year 2009-10 the AO has applied gross profit ratio @ 8.84% on the amount deposited in the bank account of the assessee. Therefore we are of the view that the rate of gross profit 10% would serve the justice to the assessee. Therefore, we direct the AO to apply the gross profit @10% on the amount of cash deposit by the assessee. Hence, this ground of appeal of the assessee is partly allowed for statistical purposes.
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