Section 68 Addition Set Aside Due to Lack of Independent Investigation by AO: ITAT Surat

Sureshbhai Bhiukhabhai Patel Vs ITO (ITAT Surat)

ITAT Surat held that addition under section 68 of the Income Tax Act is not sustainable since AO has not made any independent investigation of fact. Accordingly, ad hoc disallowance @10% upheld to avoid the possibility of revenue leakage.

Facts- During assessment, AO noted that there were huge cash deposits by assessee during demonetization period. In absence of satisfactory source of such cash deposit, AO made addition u/s. 68 of the Act of Rs.27,17,000/- and taxed the same u/s. 115BBE of the Act.

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