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TMI Blog2017 (4) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... ce that inference drawn by the ld.CIT(A) are factually incorrect. The ld.CIT(A) has right observed that total amount appearing as a deposit in the account was not cash credits, rather sale proceeds of the assessee. Turnover of the assessee is to be computed on the basis of all these details and at the most, an estimated net profit can be computed as an income of the assessee. Accordingly, the ld.CIT(A) has confirmed an addition of ₹ 3,50,208/-. We do not find any error in the detailed reasoning of the ld.CIT(A), and accordingly, the appeal of the Revenue is dismissed. - ITA.No.1652/Ahd/2011 With CO No.166/Ahd/2011 - - - Dated:- 11-4-2017 - SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER For The Rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, CO would be rejected for want of prosecution. 4. Now let us deal with the issue on merit in the appeal of the Revenue. The assessee at the relevant time was engaged in the business of purchase of plastic graduals waste and produce yarn through job work. He has field his return of income on 30.9.2009 declaring total income at ₹ 1,40,610/-. The case of the assessee was selected for scrutiny assessment and notice under section 143(2) of the Act was issued and served upon the assessee. On scrutiny of the accounts, it revealed to the AO that the assessee has a bank account of Punjab National Bank, Ramvadi Branch, Bhavnagar. The assessee has deposited cash of ₹ 50,48,055/- in the said bank account. The AO was not satisfied w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t order and the submissions of the AR of the appellant carefully. It is seen from the details filed that all the transactions are carried out through the bank account of the appellant and are reflected in the regular books of account maintained by the appellant. It is also seen that the closing balance of this bank account is reflected in the balance sheet of the appellant filed along with the audit report. When the transactions are reflected in the regular books of account and are stated to be sale proceeds the AO without making any enquiry into the source of the same, is not empowered to make an addition under section 68 of the IT Act. The bank account of the appellant has been examined. It is also seen that the aggregate cash deposited i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to make payment of ₹ 16,000/- to ₹ 18,000/- daily over a period of several days at a stretch. All these defects clearly indicate that the books of account are not reliable. Even if the cash deposited in the bank account is reflected in the cash book, since the books itself are not reliable, the results shown in the books of accounts cannot be accepted. Since the books of accounts of the appellant are incorrect, and unreliable, the proper course to be adopted by the AO was to reject the books and estimate the income of the appellant on a reasonable basis. It is obvious that the deposits in the bank account are sale proceeds of the appellant. The mere fact that the books of accounts were not correct would not empower the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e simply treated the deposits made in the bank account as unexplained cash credits. Contrary to this, the Revenue has not brought any evidence on record to demonstrate the fact that opinion formed by the ld.CIT(A) is contrary to the details available on record. In words, it has not brought to our notice that inference drawn by the ld.CIT(A) are factually incorrect. The ld.CIT(A) has right observed that total amount appearing as a deposit in the account was not cash credits, rather sale proceeds of the assessee. Turnover of the assessee is to be computed on the basis of all these details and at the most, an estimated net profit can be computed as an income of the assessee. Accordingly, the ld.CIT(A) has confirmed an addition of ₹ 3,50, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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