VISHAL GUPTA, LEGAL HEIR LATE SMT GEETU GUPTA,JAGADHRI vs. DCIT, CIRCLE, YAMUNANAGAR

To verify cash deposit of Rs.30.48 Lacs as made by the deceased assessee in her bank account, the case was reopened. It transpired that the assessee used to sell glass bangles in various markets in India. The assessee made sales of Rs.46.89 Lacs and declared income on presumptive basis u/s 44AD. The bank deposits were stated to be part of sales proceeds. However, Ld. AO, after reducing returned income of Rs.3.75 Lacs, added the remaining deposit of Rs.26.73 Lacs in the hands of the assessee.

In the first appeal, the assessee refuted the allegation of Ld. AO that she was not carrying out any business. It was demonstrated that the assessee was engaged in business activities as was evident from returns of income for AYs 2010-11 onwards. The Ld. CIT, though concurred with this fact, observed that there was sudden jump in sales from Rs.4.83 Lacs to Rs.46.89 Lacs in this year. The assessee could not explain the same satisfactorily and therefore, the impugned addition was confirmed against with the assessee is in further appeal before us.

The undisputed position that emerges is that the deceased assessee has carried out this business since past many years. The only reason to disallow the claim of the assessee was that there was sudden jump in sales. It could be seen that the assessee has declared income on presumptive basis u/s 44AD and therefore, she was not required to maintain any books of accounts. No other source of income for the deceased assessee has been shown for us. The deposits are much less than the turnover as reflected by the assessee. Under these circumstances, the explanation that the deposits were part of business sales proceeds is to be accepted. Therefore, we delete the impugned addition as made by Ld. AO. The Ld. AO is directed to accept the returned income of the assessee. 5. The appeal stand allowed. Order pronounced on 22-04-2025.