No addition for cash deposit & Balance when Accounted in books & duly explained

DCIT Vs Sri Arumuga Sugars Ltd (ITAT Chennai)

In the case of DCIT vs. Sri Arumuga Sugars Ltd (ITAT Chennai), the dispute primarily revolves around the treatment of cash deposits and balances reflected in the books of accounts of the assessee, a company engaged in the manufacturing of sugar. The contention arises from the advances made by the assessee to sugarcane farmers to ensure a steady supply of raw material. These advances were funded through bank loans and were recorded as receivables in the company’s financial statements over several years, which were not disputed.

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