HIMANSHU KWATRA,SHAHABAD MARKANDA, HARYANA vs. INCOME TAX OFFICER, KURUKSHETRA, HARYANA

Facts

The assessee's appeal arises from an assessment order where the Assessing Officer made an addition of Rs. 34 Lacs on account of cash deposits during the demonetization period. The assessee's submissions and subsequent remand proceedings did not alter the assessment, which was confirmed by the CIT(A).

Held

The Tribunal held that the impugned cash deposits were sourced from the assessee's sales proceeds, which were supported by sales invoices and VAT returns. The assessee had also offered income on a presumptive basis under section 44AD, and the bank account was part of the financial statements. Therefore, the addition made by the AO was deleted.

Key Issues

Whether cash deposits made during the demonetization period represent income from undisclosed sources when they can be explained by sales proceeds and are reflected in the assessee's financials.