Raj Kumar (M/s Radhika Sales Corp) Dhab Wasti Ram Vs ITO (ITAT Amritsar)
The appeal was filed by Raj Kumar, proprietor of M/s Radhika Sales Corporation, Dhab Wasti Ram, Amritsar, against the order of the Commissioner of Income Tax (Appeals), NFAC, Delhi, for Assessment Year 2017-18. The dispute arose from an assessment made by the Income Tax Officer, Ward 3(3), Amritsar, in which an addition of Rs. 2,74,00,000/- was made under Section 68 in respect of cash deposits during the demonetization period. The assessee had deposited Rs. 4,09,50,000/- and maintained that the deposits arose from recorded business receipts, including cash sales, cash withdrawals and amounts realised from debtors. The assessee was engaged in wholesale/retail trading of sugar, refined oil, ghee and allied karyana items and had declared turnover of Rs. 10,38,81,637/- for the relevant year.
The assessee contended that its books were audited and supported by quantitative records, VAT returns, purchase bills, transport bills, stock statements, cash book, sale and purchase registers, bank statements and debtor/creditor details. It was submitted that the assessee had maintained stock records from the inception of the business and that no defect in the quantitative tally, purchases, opening stock or closing stock had been identified. The assessee also relied upon the fact that it had started dealing in additional commodities during the year and that sales ordinarily increased around Diwali. It was further pointed out that purchases of Rs. 3,09,69,406/- had been made in October 2016, before demonetization, and that VAT had been paid on the declared transactions.
