EMERALD GEMS PRIVATE LIMITED,SURAT vs. INCOME TAX OFFICER, WARD 1(1)(2), SURAT

ITA 956/SRT/2025Status: HeardITAT Surat23 January 2026AY 2017-18Bench: DR. B.R.R. KUMAR, VICE-PRESIDENT MS. SUCHITRA KAMBLE (Judicial Member)4 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the cash deposits were recorded as sales in the regular books of account, which were accepted, and the stock was reconciled, these receipts could not be treated as unexplained cash credits under Section 68. The addition was therefore unsustainable.

What were the facts?

The assessee, engaged in diamond trading, deposited Rs. 35,25,000/- in cash during the demonetization period. The Assessing Officer treated this as unexplained cash credit under Section 68 and taxed it under Section 115BBE. The CIT(A) confirmed this.

What were the issues?

Whether cash sales recorded in regularly maintained books of account, where purchases and stock are accepted, can be treated as unexplained cash credit under Section 68.

Which sections of the Income-tax Act were involved?

Section 68,Section 115BBE,Section 145

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Income Tax Appellate Tribunal, SURAT BENCH, SURAT

Before: DR. B.R.R. KUMAR, VICE-MS. SUCHITRA KAMBLE

For Appellant: Shri Rasesh Shah, CA
For Respondent: Shri Ashish Kumar, Sr DR
Hearing: 21.01.2026Pronounced: 23.01.2026

PER DR. B.R.R. KUMAR, VICE-PRESIDENT:

- This appeal has been filed by the assessee against the order dated 25.07.2025 passed by the Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as the “Ld. CIT(A)”), under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) for Assessment Year 2017-18. 2. The assessee has raised following grounds of appeal:-

“Grounds of Appeal

1.

On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of Assessing Officer in making addition of Rs. 35,25,000/- on acco

The order continues below.

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