RAHUL BHOWMICK (LEGAL HEIR OF FULLARA BHOWMICK, DECEASED),BURDWAN vs. ITO, WARD 1(1), , BURDWAN

This is an appeal filed by the assessee against the order of ld.
Commissioner of Income Tax (Appeals), National Faceless Appeal Centre
(NAFC), New Delhi NFAC), Delhi dated 5.2.2025 in Appeal No. CIT(A),
Burdwan/10124.2019-20 passed for Assessment Year 2017-18. 2. The only grievance raised in the grounds of appeal is that the ld CIT(A) erred in upholding the addition of Rs.11,20,229/- as Act made by the Assessing Officer as unexplained money u/s.68 of the.
3. Briefly facts are that the assessee filed the return of income on 25.10.2017 declaring total income at Rs.4,41,520/-. The assessee is engaged in the business of grocery items. The case of the assessee was selected for Assessment Year : 2017-18

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limited scrutiny for huge cash deposits in the bank account of the assessee.
Accordingly, statutory notices were issued and served upon the assessee.
The Assessing Officer called for information from the bank u/s.133(6) of the Act and the bank furnished the copies of the bank statement. The Assessing
Officer found from the bank statement that the assessee has made huge cash deposits during the year. The Assessing Officer noted that during the year, the assessee has deposited cash of Rs.3,81,30,500/- into IDBI Bank and during the demonetisation period i.e. from 12.11.2016 to 30.12.2016, the assessee had deposited Rs.33,61,500/- including SBNs of Rs.4,00,000/-.
Accordingly, a show cause notice was issued to the assesse to explain the same. The assessee replied before the AO and the AO after considering the reply of the assessee held that the total turnover for the year ended on 31.3.2016 were Rs.4,03,68,869/-, whereas the turnover for the year ended on 31.3.20127 was Rs.3,70,10,271/- and thus, there is reduction in the turnover to the tune of Rs.33,58,598/-. However, there has been increase in the cash deposits in the bank account. Then the AO compared the turnover of two years and made an addition of Rs.11,20,229/- on the ground that the same remained unexplained.
4. In the appellate proceedings, the ld CIT(A) dismissed the appeal of the assessee by upholding the assessment order by simply stating there is no infirmity in the order of the Assessing officer.
5. After considering the rival submissions and perusing the orders of lower authorities, we find that the assessee is dealing in grocery items and Assessment Year : 2017-18

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the AO on the basis of comparison of sales during the financial year 2016-17
and 2015-16 made an addition of Rs.11,20,229/- on the ground that same remained unexplained. According to the AO the assessee had deposited cash into the bank account of IDBI bank which remained unexplained.
6. We note that the assessee has duly maintained books of account which were being duly audited by the Chartered Accountant of the assessee. The amount as pointed out by the AO was already included in the sales during the year and offered to tax. Therefore, the action of the AO in disallowing
Rs.11,20,229/- without rejecting the books of account and without disturbing the sales is not tenable in the eyes of law. In our opinion, once the assessee has offered the receipts in the turnover during the year, then the provisions of section 68 of the Act cannot be invoked. Therefore, we are inclined quash the appellate order and direct the AO to delete the addition.
7. In the result, appeal of the assessee is allowed.

Order dictated and pronounced in the open court on 17.09.2025. (RAJESH KUMAR)

Accountant Member

Kolkata: Dated 17.09.2025
B.K.Parida, Sr. PS (OS)
Assessment Year : 2017-18

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Copy of the Order forwarded to :

By order

Asst.