April 2019

Section 68 – Bank account of an assessee cannot be held to be ‘books’ of the assessee maintained for any previous year, and therefore, no addition u/s. 68 can be made in respect of a deposit in the bank account.

Jagdish T. Punjabi | Devendra Jain | Tejaswini Ghag
Chartered Accountants

1.       [2019] 198 TTJ (Asr) 114 Satish Kumar vs. ITO ITA No.: 105/Asr/2017 A.Y.: 2008-09 Dated: 15th January, 2019

                                               

Section 68 – Bank account of an assessee cannot be held to be ‘books’ of the assessee maintained for any previous year, and therefore, no addition u/s. 68 can be made in respect of a deposit in the bank account.

 

FACTS


The assessee had filed his return of income for A.Y. 2008-09. In the course of the assessment proceedings the Assessing Officer observed that the assessee had during the previous year made a cash deposits of Rs.11,47,660 in his saving bank account. In the absence of any explanation on the part of the assessee as regards the 'nature' and 'source' of the aforesaid cash deposit in the aforesaid bank account, the Assessing Officer made an addition of the peak amount of cash deposit of Rs.11,47,660 u/s. 68 of the Act.

 

Aggrieved by the assessment order, the assessee preferred an appeal to the CIT(A). The CIT(A) upheld the addition made by the Assessing Officer and dismissed the appeal.

 

HELD


The Tribunal held that an addition u/s. 68 could only be made where any sum was found credited in the books o

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