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2021 (1) TMI 13 - AT - Income TaxUnexplained cash deposits in bank accounts - assessee submitted that the assessee had purchased land at Dehu Road and since payment for purchase of land was to be made urgently, the assessee deposited cash in his bank account - new ground raised by the assessee whether the provisions of section 68 of the Act are attracted where the assessee has not maintained books of account and has filed return of income on the basis of presumptive income under section 44AD of the Act? - HELD THAT:- The new ground raised by the assessee before the Tribunal being legal in nature is admitted for adjudication on merits in the light of decision rendered by Hon’ble Apex Court in the case of National Thermal Power Co. Ltd. vs. CIT [1996 (12) TMI 7 - SUPREME COURT] A bare perusal of section 68 of the Act makes explicitly clear that the addition can be made under the section if, any sum is found credited in the books maintained by the assessee. That is the books should be that of the assessee. The definition of books under the Act is inclusive. A perusal of the definition shows that the same does not include bank passbook or bank statement. A conjoint reading of above provisions would thus lead to the conclusion that the addition u/s 68 can be made only where any amount is found credit in the books as defined u/s 2(12A) of the Act maintained by the assessee. Maintaining of books by the assessee is sine qua non for making addition u/s 68 of the Act. Since section 44AD does not obligates the assessee to maintain books, the provisions of section 68 cannot be invoked where the assessee has filed return of income under the provisions of section 44AD of the Act without maintaining books of account. As in the case of Anand Ram Raitani vs. CIT [1996 (8) TMI 95 - GAUHATI HIGH COURT] has held that existence of books of account is a condition precedent for invoking the provisions of section 68 by the Assessing Officer. The Tribunal in the case of Madhu Raitani [2010 (10) TMI 905 - ITAT GAUHATI ] held that if books of account are not maintained by the assessee, the provisions of section 68 cannot be invoked. The Tribunal further held that bank passbook cannot be considered as books of account. Thus no addition under section 68 can be made in the instant case. We find merit in ground no.1 raised by the assessee in appeal.
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