Section 68- Trade credits cannot be taxed as unexplained cash credit

Advertisement Brief Facts of the case: The assessee is a partnership firm which is engaged in the business of manufacture and trading in edible oils. The return of income for the year under consideration was filed by it on declaring total income of Rs.45,008. In the assessment originally completed under section 143(3), the total income of the assessee was determined by the A.O. at Rs.59,14,923 after making additions of Rs.54,49,961 under Sec 68 treating the amount payable by the assessee to farmers towards purchase of sunflower seeds as unexplained cash credits. Further AO added the opening...