Manasi Mahesh Saigaonkar Kasba Peth Vs ITO (ITAT Pune)
Summary: The Pune Bench of the Income Tax Appellate Tribunal considered the assessee’s appeal for Assessment Year 2013-14 against the order dated 09.03.2026 of the Ld. Addl. / JCIT(A)-1, Gurugram, confirming an addition of ₹26,51,000 made by the Assessing Officer under section 69A of the Income Tax Act, 1961 in respect of cash deposited in the assessee’s SBI account. The assessee, an individual engaged in the business of ladies’ bangles at Shivardhan, Dist. Raigad, had not filed a return for AY 2013-14, following which the assessment was reopened under Section 147 and notice under Section 148 was issued on information regarding cash deposits of ₹26,51,000. Before the Addl. / JCIT(A), the assessee challenged the addition, validity of reassessment proceedings and sought application of peak-credit theory or estimation of income at 8% of turnover under Section 44AD, but the appellate authority rejected the contentions and dismissed the appeal. Before the Tribunal, the assessee relied upon the bank statement showing continuous cash deposits and withdrawals, the accepted nature of her ladies’ bangles business, an MSME certificate and the fact that profit of approximately 10.57% declared in the subsequent year had been accepted on processing under Section 143(1). The Tribunal found merit in the contention that the entire deposits could not be treated as unexplained cash deposits and were out of business receipts. Considering that the assessee had not filed her return or participated in the assessment proceedings and had declared profit at approximately 10.57% in the subsequent year, the Tribunal held that adoption of a 12% profit rate on the ₹26,51,000 cash deposits would meet the ends of justice. It therefore set aside the order of the Ld. Addl. / JCIT(A) and directed the Assessing Officer to restrict the addition by computing profit at 12% of the cash deposits, with the grounds accordingly partly allowed. The appeal was partly allowed and the order was pronounced in the open Court on 25th August, 2026.
