Vikas Sethi Vs ITO (ITAT Delhi)
The assessee appealed against the order of the National Faceless Appeal Centre (NFAC) for Assessment Year 2017-18. The appeal challenged the validity of the assessment proceedings, the jurisdiction of the Assessing Officer, and the confirmation of an addition of Rs. 2,26,54,967 under Section 69A of the Income-tax Act, 1961 on account of cash deposits.
The assessee, proprietor of M/s Smart Infosystems, was engaged in trading computer peripherals and parts, rendering service assignments for HCL Services Ltd. and TVS Electronics Ltd., and handling prepaid coupon business for telecom companies. The original return was filed on 28 December 2017 declaring income of Rs. 6,49,400 and a revised return was filed on 29 December 2017 declaring income of Rs. 4,99,280.
During assessment proceedings, the assessee furnished bank books for all bank accounts for FY 2016-17, a daily cash withdrawal report, cash book containing day-wise cash receipts and deposits, and workings of daily and monthly cash balances. The Assessing Officer was not satisfied with the explanation and made an addition of Rs. 2,57,93,500 under Section 69A. The CIT(A) partly allowed the appeal by granting relief of Rs. 27,38,533 on account of cash sales but sustained an addition of Rs. 2,26,54,967.
