ACIT Vs Goel Jewellers Overseas Corp (ITAT Delhi)
The Delhi Bench of the Income Tax Appellate Tribunal dismissed the Revenue’s appeal against the order of the Commissioner of Income Tax (Appeal), National Faceless Appeal Centre, Delhi, which had deleted an addition of Rs.3,89,52,097/- made by the Assessing Officer under Section 68 of the Income-tax Act, 1961. The assessee’s Cross Objection was also dismissed as having become infructuous.
The assessee, engaged in manufacturing, export and retail sale of jewellery, filed its return for AY 2017-18 declaring total income of Rs.19,27,857/-. During scrutiny, the Assessing Officer specifically examined cash deposited during the demonetisation period from 09.11.2016 to 31.12.2016. The assessee had deposited total cash of Rs.4,57,89,000/- in its bank accounts during that period.
The Assessing Officer noticed a steep increase in cash sales during October 2016 compared with the corresponding period of the preceding year and the figures in succeeding years. Although the assessee furnished a reply, the Assessing Officer did not accept the explanation. He concluded that the excess sales shown immediately before the demonetisation period were bogus/non-genuine cash sales allegedly used as a device to introduce unaccounted money into the books. He consequently made an addition of Rs.3,89,52,097/- as income from undisclosed sources under Section 68.
