GAURI SHANKAR BHOOT,RAIRANGPUR,MAYURBHANJ vs. ASST. COMMISSIONER OF INCOME TAX, CIRCLE BALASORE,BALASORE

1 ITA No.436/Ctc/2026 Assessment Year: 2017-18

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE S/SHRI GEORGE MATHAN, JUDICIAL MEMBER AND RAJESH KUMAR, ACCOUNTANT MEMBER ITA No.436/Ctc/2026 Assessment Year: 2017-18 Gouri Shankar Bhoot, Ward Vs. ACIT,Circle- Balasore No.6, Rairangpur, Mayurbhanj. PAN/GIR No. ACZPB 0518 K (Appellant) .. ( Respondent) Assessee by : Shri S.K.Agarwal, CA Revenue by : Shri Vijaya Singh, Sr. DR Date of Hearing : 26/05/2026 Date of Pronouncement : 26/05/2026

O R D E R Per Bench This is an appeal filed by the assessee against the order of the ld CIT(A), NFAC, Delhi dated 25.3.2026 in Appeal No.CIT(A),Cuttack/10732/2019-20 for the assessment year 2017-18. 2. Shri S.K.Agarwalla, ld AR appeared for the assessee and Shri Vijaya Singh, ld Sr. DR appeared for the revenue. 3. It was submitted by ld AR that the assessee is in the business of wholesale grocery. It was the submission that the assessee had shown turnover of Rs.25,57,81,789/-. It was the submission that the assessee had shown net profit of 0.83% which was enhanced to 1% after rejecting the books of account of the assessee. It was the submission that after rejection of books of account and

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estimating the income, the Assessing Officer further proceeded to make addition of Rs.70,52,000/-, which was SBN currency deposited during the demonetization period. It was the submission that the SBN being the cash deposit was part of the turnover of the assessee also. It was the submission that same has not been reduced from the turnover. It was the submission that the assessee being in the grocery business, cannot choose to receive any currency, which are given by the customers. Thereafter, the Assessing Officer further made addition in respect of VAT and entry tax demand debited to profit and loss account of Rs.4,64,999/-. It was the submission that once all the books of account are rejected and income is estimated, further disallowance in profit and loss account is not permitted. 4. In reply, ld Sr DR vehemently supported the order of the AO and ld CIT(A). 5. We have considered the rival submissions. A perusal of the facts in the present case clearly shows that the Assessing Officer has rejected the books of account of the assessee. The Assessing Officer has also accepted the turnover of the assessee of Rs.25,57,81,789/- and estimated the income of the assessee at 1%. Once the books of account are rejected then no further addition can be made from the profit and loss account as the amount reflected in the books of account is part of turnover. The Assessing Officer has basically done the arithmetic jugglery and has made the addition. The cash book of the assessee clearly shows that there is sufficient cash available for making the deposits in the bank account during the demonetization period. This being so, the addition of Rs.43,41,978/- made by the Assessing Officer and the addition of Rs.6,64,999/- as made by the AO and confirmed by the ld CIT(A) stands deleted.

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