Case Law Details
Harisons Diamonds Pvt Ltd Vs ACIT (ITAT Delhi)
ITAT Delhi held that that cash sales that is already offered as income cannot be taxed in the grab of inflation sales to cover up demonetization currency. Accordingly, addition u/s. 68 of the Income Tax Act directed to be deleted.
Facts- In the present case, the substantive grievance of the assessee relates to the addition on account of cash sales amounting to Rs. 3,25,52,833/- made during the period 01.10.2016 to 08.11.2016 held to be unexplained credit u/s 68 r.w.s 115BBE of the Income-tax Act, 1961.
Notably, during the course of the assessment proceedings, AO was of the firm belief that there was an abnormal increase in the percentage of cash sales during the period 01.10.2016 to 08.11 2016. Further, sales did not have the name of the purchaser and PAN. Cash sales from 01.10.2016 to 08.11.2016 amounting to Rs. 4,73,58,629/- was added as unexplained cash credit u/s 68 of the Act and accordingly, added to the income of the assessee.
On appeal, CIT(A) directed AO to restrict the addition to Rs. 3,25,52,833/-. Being aggrieved, both assessee and revenue has preferred the present appeal.
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