CHETANKUMAR SURESHCHANDRA SHAH,BHARUCH vs. ITO, WARD 1(3), BHARUCH

ITA 387/SRT/2026Status: DisposedITAT Surat16 September 2026AY 2015-168 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the AO treated cash deposits as business income twice, leading to double taxation. The Tribunal found that the cash deposits were explained by earlier cash withdrawals from disclosed bank accounts.

What were the facts?

The Assessing Officer (AO) treated cash deposits in the assessee's bank account as gross business receipts and added 50% as income. The assessee contended that these deposits were out of earlier cash withdrawals and supported this with a cash book and cash flow statement. The CIT(A) upheld the AO's order.

What were the issues?

Whether cash deposits in bank accounts are unexplained income when they are explained by earlier cash withdrawals from disclosed bank accounts. Whether the AO erred in treating cash deposits as business receipts and estimating income at 50% without considering the assessee's explanation and cash flow.

Which sections of the Income-tax Act were involved?

Section 44AD,Section 143(2),Section 142(1),Section 234A,Section 234B,Section 234C,Section 234D,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, SURAT BENCH, SURAT

Before: MS. SUCHITRA KAMBLE & SHRI B.M. BIYANI

For Respondent: Shri Ashish Kumar, Sr. DR
Pronounced: 16.09.2026

PER : SUCHITRA KAMBLE, J M:

The appeal filed by the assessee is against the order passed by the Commissioner of Income Tax, Appeals, ADDL/JCIT(A)-1, Jaipur [in short “CIT(A)”] dated 04.02.2026 for the Assessment Year (in short “AY”) 2015-16. 2. The assessee has raised the following grounds of appeal:

“1. Addition of Rs.45,41,925/- being approx. 50% of (Rs.98,03,850/- less income already declared of Rs.7,20,000/-) on account of cash deposited in bank being considered as gross business receipt

The order continues below.

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