Case Law Details
Sneh Developers Pvt. Ltd Vs DCIT (ITAT Delhi)
As per the AO, the assessee has not filed return of income and hence notice u/s 148 of the Income Tax Act, 1961 has been issued owing to cash transactions exceeding Rs.10,00,000/-. The AO held that the assessee has not given any details with regard to the cash deposits of Rs.10,00,000/-. Hence, the amount has been added u/s 68 of the Act. Further, the assessee had credits of Rs.2.94 Cr. as per Form 26AS and since the source of income is not established. The AO made addition of the amount reflected in the Form 26AS.
On appeal, the ld. CIT(A) vide his order dated 26.12.2017 confirmed the action of the AO in adding Rs.10,00,000/- u/s 68 as the assessee has failed to furnish any submission explaining the source of cash deposits (para 6.2). Further, the ld. CIT(A) keeping in view the facts that the assessee has not filed return of income, issue of notice u/s 148, failure of the assessee to maintain books of accounts as per Section 44AA and Section 44AB, non-cooperation during the assessment proceedings as well as the remand proceedings, adverse remarks given in the audit report and keeping in view the arguments of presumptive taxation held that it was fair and reasonable to estimate the profits @ 15%.
With regard to the cash deposits of Rs.10,00,000/-, the ld. AR has vehemently argued that since the amounts have been estimated, no other addition can be sustained. However, we find that the arguments of the ld. AR cannot be supported as the cash deposits are not corroborated with any receipts of the business and any cash withdrawals proving the same. Hence, we unequivocally hold that the cash deposits cannot be treated as the integral part of the receipts reflected in Form 26AS. Ergo, the order of the ld. CIT(A) is affirmed on the issue of addition u/s 68 of the Act pertaining to cash credits.
FULL TEXT OF THE ORDER OF ITAT DELHI
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