MOHAMMAD RAFI DAR,BUDGAM vs. ITO, WARD 1, SRINAGAR, SRINAGAR

ITA 589/ASR/2025Status: DisposedITAT Amritsar31 August 2026AY 2017-185 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal accepted that the cash deposit was from the sale of medicines and directed the AO to estimate the gross turnover from the medicine business at Rs. 75 lakhs, applying a net profit of 4%. The addition under Section 69A was deleted as it was considered part of the business turnover.

What were the facts?

The assessee deposited Rs. 13.93 lakhs in cash during demonetisation, claiming it as sale proceeds from their pharmaceutical business. The AO made additions based on this deposit and estimated business profits, which were confirmed by the CIT(A) ex-parte.

What were the issues?

Whether cash deposits during demonetisation, claimed as sale proceeds, should be added separately or considered as part of business turnover. The validity of ex-parte assessment and the profit estimation for the pharmaceutical business.

Which sections of the Income-tax Act were involved?

Section 69A,Section 144,Section 250,Section 115BBE,Section 270A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR.

Before: SH. S. RIFAUR RAHMAN & SH. UDAYAN DAS GUPTA

Hearing: 21.07.2026Pronounced: 31.08.2026

Per: Udayan Dasgupta, JM: This appeal is filed by the assessee against the order of ld. CIT(A), NFAC, Delhi, passed u/s 250 of the IT Act, 1961, dated 20.06.2024, which has emanated from the order of the AO, passed u/s 144 of the Act, dated 23.12.2019. 2. Grounds of appeal taken in Form 36 are as follows:

“1. That the Learned AO erred in making addition of Rs. 1393500.00 only due to the reason that the same were accepted in lieu of cash sale of pharmaceuticals and medicines 1 which the Worthy CIT(A) confirmed. That the Learned AO failed to appreciate that there was no provisions in the Income Tax Act/notification not allowing the receipt of sale proceeds in SBN. Assessment Ye

The order continues below.

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