Tax Authority Can't Make Presumptive Additions to Income Without Evidence of Actual Earnings.

The Tax Authority is not permitted to make presumptive additions to an individual's income without evidence of actual earnings. In this case, the Assessing Officer (AO) added income based on alleged bogus transactions. The Income Tax Appellate Tribunal (ITAT) ruled that the AO should have either rejected the books of account and determined the actual profit or accepted the returned income as filed. The AO cannot assume additional income without proof of it being earned by the taxpayer. Consequently, the ITAT deleted the AO's additions, ruling in favor of the taxpayer. .....

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