INCOME TAX ACT, 1961

Section 68

Income from undisclosed sources - Addition under section 68 - Assessee failed to explain source of cash deposit in saving bank deposit -

AO on the basis of information available according to the annual information return on ITD system observed that assessee had deposited a sum in his savings bank account and had failed to explain the source of said cash deposit. Thus, he made addition under section 68 as unexplained cash credit. Held: If the assessee fails to give any explanation of the source and nature of money deposited in his bank account, definitely the provisions of section 68 of the Income Tax Act apply, as the assessee has failed to discharge initial onus cast upon him. In absence of any evidence, that he is carrying on business as a commission agent, cannot be believed. Even if it is believed, that he is a commission agent, the ignorance of the fact that who is principal, on whose behalf he is working, is not known to the assessee or he is not disclosing, it clearly shows that addition is required to be made in the hands of the assessee as there is no explanation about the source and nature of credits. Thus, addition on account of unexplained cash credit being cash deposited in the bank account of the assessee was confirmed.

REFERRED :

FAVOUR : Against the assessee.

A.Y. : 2011-12

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