Pathan Wajeed Khan Manzoor Vs ITO (ITAT Pune)
Pune ITAT: Cash Deposits Cannot Be Taxed as Unexplained Money When Scrap Business Turnover Is Accepted in Other Years
The Pune ITAT set aside an assessment where the Assessing Officer had treated cash deposits of ₹1.28 crore in the assessee’s bank account as unexplained money under section 69A and taxed the same under section 115BBE. The assessee, engaged in the scrap business for several years, explained that due to a hard-disk crash and loss of data, the turnover reflected in one bank account could not be incorporated while filing the return and requested that income be estimated by applying an 8% profit rate on the turnover.
The Tribunal noted that in both earlier and subsequent years, assessments completed under section 143(3) had accepted the assessee’s scrap business and estimated income by applying a net profit rate of 8% on turnover. Since the facts were identical and the Revenue itself had accepted the business model in other years, there was no justification for treating the entire bank deposits as unexplained money. The matter was restored to the Assessing Officer for fresh adjudication after considering past and subsequent assessment records and after granting adequate opportunity to the assessee. The appeal was allowed for statistical purposes.
Assessee was represented by : Shri Umesh Ruparel
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal filed by the assessee is directed against the order dated 15.07.2025 passed by Ld. CIT(A)/NFAC for the assessment year 2016-17.
