DCIT, CENTRAL CIRCLE-29, DELHI V. SH BASANT JAIN, DELHI

ITA 2761/DEL/2023

AI Insights

The case involves Shri Basant Jain, an individual engaged in the business of trading gold, diamond, and silver jewelry through his proprietorship, Jainsons Jewellers. The Income Tax Department scrutinized his returns for the Assessment Year 2017-18, particularly focusing on substantial cash deposits during the demonetization period. The AO made additions under section 68, treating these deposits as unexplained. However, the CIT (A) reversed this decision, finding that the deposits were from legitimate business activities. The Tribunal agreed with the CIT (A), dismissing the Revenue's appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708316 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Assessment Year: 2017-2018
• Other Referred Cases: Sumati Dayal Vs. CIT, CIT Vs. Durga Prasad More, Fine Gujranwala Jewelers Vs 1T051 taxmann.com 340 (Delhi - Trib.), PClT Vs Agson Global, S. Balaji Mech-Tech (P.) Ltd., J.R.Rice India (P) Ltd
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH TIWARI
• Assessee Lawyers: R.S.SINGHAVI
• Keywords: Business income; Revised return; Unexplained cash credit; Salary income; Onus to prove; Principle of natural justice; Bogus
• Section: 143(3); 142(1); 68; 145; 139(5)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’: NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER and SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA No.2761/DEL/2023 (Assessment Year: 2017-18) DCIT, Central Circle 29, vs. Shri Basant Jain, Delhi. C – 119, Shivaji Park, Punjabi Bagh, New Delhi – 110 026. (PAN : ADBPJ2416P) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri R.S. Singhavi, CA Shri Rajat Garg, CA REVENUE BY : Shri Rajesh Tiwari, Sr. DR Date of Hearing : 21.05.2025 Date of Order : 16.07.2025 O R D E R PER S.RIFAUR RAHMAN, ACCOUNTANT MEMBER : 1. This appeal is filed by the assessee against the order of ld. Commissioner of Income-tax (Appeals)-30, New Delhi [hereinafter referred to as ‘ld. CIT (A)] dated 18.07.2023 for Assessment Year 2017-18. 2. Brief facts of the case are, assessee is an individual having proprietorship, namely, Jainsons Jewellers and also Director in Basant Jewellers Pvt. Ltd. and it is engaged in the business of trading of gold, diamond and silver 2 ITA No.2761/DEL/2023 jewellery. The return of income was filed on 29.10.2017 under section 139(5) of the Income-tax Act, 1961 (for short ‘the Act’) declaring income of Rs.17,60,650/-. Subsequently, he revised return of income on 20.11.2017 and the income was declared at Rs.19,40,650/-. After claiming deductions under Chapter VI-A at Rs.1,67,500/-, the income declared by the assessee includes salary income of Rs.3,00,000/- and business income of Rs.18,02,345/- and income from other sources of Rs.5,600/-. The business gross receipt declared by the assessee of Rs.9.54 crores against the purchases of stock of Rs.14.76 crores, assessee reported closing stock of Rs.6.45 crores. The case was selected for complete scrutiny through CASS for the reason of large value cash deposited during demonetization period. Accordingly, notices u/s 143(3) and 142(1) of the Act were issued and served on the assessee. In response, assessee has furnished the business activities, business organization structure and audited books of account and with a justification of cash deposit during demonetization period. 3. During assessment proceedings, AO observed that assessee has deposited cash during demonetization period with IDFC Bank to the extent of Rs.5.345 crores and he observed that the monthly cash deposit furnished by the assessee along with bank statement was FYs 2015-16 and 2016-17 were processed and he observed that during previous assessment years, assessee has deposited an amount of Rs.2,37,75,500/- during the period 09.11.2015 to 3 ITA No.2761/DEL/2023 30.12.2015 in the company. During current assessment year, it has deposited Rs.5,34,50,000/-. Further he observed that between 01.10.2016 till 08.12.2016, almost 99% of the sales in silver, gold and diamond items of jewellery by cash only. Since assessee has deposited huge cash during demonetization period after analyzing various details provided by the assessee, after analyzing VAT return and bank statement, the cash deposit of Rs.5,34,50,000/- made during the period as an unexplained cash deposit and assessee failed to satisfy him with relevant documents, accordingly he proceeded to make the addition u/s 68 read with section 115BBE of the Act. 4. Further he observed that assessee has taken advances from various persons during the year under consideration and assessee was asked to submit complete details. In response, assessee furnished a list wherein only name and amount were disclosed. No other details were furnished and he came to the conclusion that assessee failed to discharge its onus to prove the genuineness, creditworthiness and identity of the persons from whom advances were taken, accordingly he disallowed an amount of Rs.35,75,989/- u/s 68 r.w.s. 115BBE of the Act. 5. Aggrieved assessee preferred an appeal before the ld. CIT (A)-30, New Delhi and made detailed submissions before him. Before ld. CIT (A), assessee has submitted detailed submissions which are reproduced by ld. CIT (A) at pages 19 to 49 of the appellate order. After considering the detailed submissions 4 ITA No.2761/DEL/2023 and findings in assessment order, ld. CIT (A) deleted the additions made by the AO with the following observations :- “7.1 Ground No.1: In this ground the appellant challenged addition of Rs.5,34,50,000/- on account of deposit of cash in the bank account during demonetization period. As per the assessee, the above said cash deposit represent sale made by the assessee. However, the AO considered the sale as non-genuine particularly when the cash represented by such sales was kept in hand for considerable period of time and not deposited in the bank account and confirmation from buyers were also not filed. The AO has also made reference to preponderance of human probability and surrounding circumstances and after relying on decision of Supreme Court in the case of Sumati Dayal Vs. CIT 214 ITR 4801 and CIT Vs. Durga Prasad More 82 ITR 540 considered the cash deposited in the bank account as unexplained/unverified. The Assessing Officer further observed that there were discrepancies in the VAT return also. 7.2 The appellant has filed detailed submission in support of grounds raised in the memo of appeal. My attention was drawn to summary of events which were relevant to the issue under reference. It was submitted that the assessee has been engaged in the business of jewellery for number of years and jewellery business has been carried on by M/s. Basant Jewellers (India) Pvt. Ltd(Company), a corporate entity till its takeover by MI s. Jainsons Jewellers, a proprietorship concern of Mr. Basant Jain w.e.f. pt October, 2016. As a result of such takeover, the stock of jewellery was transferred by M/s. Basant Jewellers (India) Pvt. Ltd. to Jainsons Jewellers being the proprietary concern. The sequence of events filed by the Appellant is extracted as under:- 5 ITA No.2761/DEL/2023 7.3 The appellant contended that entire deposit in the bank account was in respect of jewellery sales duly corroborated from VAT returns and as such the presumption of the Assessing Officer is misconceived and in total disregard to facts of the case. The appellant placed on record complete details of jewellery acquired from Company and its sale to various customers. It was explained that cash was kept in hand in the absence of bank account. The reasons for delayed in opening of the bank account was on the ground that VAT certificate was not issued during relevant period of time even though the same was applied after takeover of the business. It was submitted that there is complete nexus between sale and such deposit in the 6 ITA No.2761/DEL/2023 bank account. The appellant has maintained regular books of accounts and trading results are supported from Audited Accounts and Tax Audit Report. The appellant made reference to various case laws as part of its submissions which have been extracted supra. 7.4 . I have carefully considered the basis of addition made by AO and submission of assessee. The fact of deposit of cash during demonetization period is not in dispute. It is noted that the appellant is engaged in business of jewellery as a proprietor. The appellant acquired the business being carried on by the Company as proprietorship concern under the name and style of M/s Jainsons Jewellers. 7.5 After going through the documents placed on record and the assessment order, it is observed that the assessee has been engaged in the business of jewellery as proprietor and had taken over the business from the Company during the year. It is noted that AO has not adversely commented on trading activities except observing that the cash sales in the month, October 2016 and Nov 1st to Nov. 8th (i.e., period prior to demonetization) was abnormally high; that the cash was kept in hand without being deposited in the bank account after sales and that the confirmation of the parties were not filed. In fact, AO has made addition only in respect of cash deposit during the demonetization period and for the rest of the year deposit of cash represented by sale proceeds is not in dispute. It was submitted that assessee is operating from small town of Sonepat and cash sale is a regular feature of business. The appellant placed on record comparative details of cash sales which are extracted as under : 7 ITA No.2761/DEL/2023 8 ITA No.2761/DEL/2023 7.6 The appellant has also clarified that the sale was fully reconciled with Annual VAT returns and that the VAT assessment orders fully support and corroborate the trading activities declared by the appellant relevant to the year under reference. The AO has not pointed out any mistake in the inventory or the purchases of stock by the appellant from the Company which had transferred the stock. The AO has not pointed out any error in the books of accounts and it was not rejected u/s 145. As regarding the cash being kept in hand after its sales, it is observed that assessee was not in a position to open the bank account in the absence of certificate from VAT Authorities even though the same was applied immediately after the takeover of the business from the Company. The appellant submitted evidence that the stock was taken over from the Company on 1st October 2016, application for the VAT registration was filed on 5th October, VAT registration was granted on 28th October 2016 and the bank account was opened after VAT registration on 5th November 2016. These dates are prior to the announcement of demonetization and the documents issued by the VAT Authorities or the banks cannot be termed as afterthought or manipulation. The statement of the appellant was recorded at the time of survey on 30.05.2018 and questions were raised by the survey team regarding cash deposits made by the appellant in the demonetization period. The relevant part of statement is as under: ………………. The clarifications given by the appellant in his statement and subsequently during assessment proceeding with documentary evidence are found to be consistent and reasonable. 7. Regarding filing of the confirmation of the parties to support the sales, the appellant clarified that rigor of sec. 68 is not relevant in respect of trading activities and relied on the several decisions as mentioned supra. The appellant is not required to keep complete details of buyers unless the sale is in excess of Rs 2 lakhs. It is also not required to prove the identity or creditworthiness of the buyers in case the credit entries pertain to sale proceeds. Onus is on revenue to prove that the sales shown by the appellant were bogus. After going through comparative details of cash sales and the trading history of the Company and the appellant in relevant three years it is noted the cash sales are approximately 85-90% of total sales. No evidence was found during the Survey proceedings at the premises of the appellant or gathered during the assessment proceedings to establish that the sale invoices were pre-dated after the announcement of demonetization of SBNs to adjust unaccounted cash of the appellant. The AO did not point out any mistakes in the stocks shown by the appellant. I have gone through various case laws as referred by the appellant and find that in the absence of any evidence, the sales recorded by the appellant cannot be held to be bogus. Further, reliance is also placed on the decision of Hon'ble ITAT Delhi in the case of Fine Gujranwala Jewelers Vs 1T051 taxmann.com 340 (Delhi - Trib.) and Hon 'ble High Court of Delhi in the case of PClT Vs Agson Global 134 taxmann.com 256 which are relevant to the facts of the case. 7.8 In view of the above facts and findings, the addition of Rs.5,34,50,000/- made by the AO u/s 68 is hereby deleted and this ground of appeal is allowed.” 9 ITA No.2761/DEL/2023 6. With regard to advance received from its customers, ld. CIT (A) deleted the addition by observing as under :- “9. Ground No.3: In this ground the appellant has challenged addition of Rs.35,75,988/ - being advance received from the customers. The Assessing Officer has observed that in the absence of confirmation from the parties such advance is considered as unexplained in terms of sec. 68 read with sec. 115BBE. 9.1 The appellant has filed details of Advances from Customers amounting to Rs. 35,75,988/- and also demonstrated that the above said advances have been considered as sale in the subsequent year as per details placed in the paper book page 375 to 429. The submission of the appellant has been considered and sample checked and it was found to be in order. Once such advances have been considered as trading receipts, there is no basis to treat the same as unexplained. Accordingly, the addition made by the AO on this account is considered not sustainable and is deleted.” 7. Aggrieved Revenue is in appeal before us raising following grounds of appeal :- “1(i) That on the facts and circumstances of the case, the Assessing Officer was not justified in making addition of Rs.5,34,50,000/- u/ s 68 of the Income Tax Act, 1961 on the ground of alleged unexplained cash deposits without appreciating the facts of the case. (ii) That the nature and source of cash deposits is fully corroborated from sales already accounted for as trading receipt and quantitative details of stock, there is no case of any unexplained cash deposits in terms of provisions of section 68 of the Income Tax Act, 1961. (iii) That there is direct nexus between cash deposit and trading receipt, there is no case of same being treated as unexplained cash deposits in terms of provisions of section 68 of the Income Tax Act, 1961. (iv) That the profit earned on cash sales made by the appellant being already offered to tax and the same was accepted by the Assessing Officer, the addition in respect of cash deposit tantamount to double addition and as such the impugned addition is against the principle of natural justice. (v) That the genuineness of cash sales is also supported from VAT Returns and as such treating the same as unexplained is contradictory and self-defeating. 10 ITA No.2761/DEL/2023 (vi) That there being no adverse material or information on record regarding cash deposits made by the appellant, the impugned addition by the Assessing Officer is merely on the basis of presumption & surmises. (vii) That even otherwise, the Assessing Officer without rejecting the Audited books of accounts in terms of provisions of section 145 of the Act and without pointing out any discrepancy/infirmity in the quantitative sales/purchases made by the appellant, is not justified in making addition on account of unexplained cash deposits and as such the same is not sustainable under law. (viii) That infact, the source of cash deposits made by the Appellant is duly recorded in the Audited books of accounts and as such the addition made by the Assessing Officer is against the scope and purview of provisions of section of 68 of the Act. 2 That the provisions of section 115BBE read with section 68 of the Act in charging the income tax @60% are unconstitutional and against the principles of natural justice and even otherwise, the same are applied on illegal and arbitrary basis. 3(i) That on the facts and circumstances of the case, the Assessing Officer was not justified in making addition of advances received from customers to the extent of Rs.35,75,988/- on the alleged ground that onus regarding the genuineness, creditworthiness and identity of these \"customers was not discharged by the appellant. (ii) That transaction of advances being supported from relevant documentary evidences and the same having been adjusted in the subsequent years, the impugned addition u/ s 68 of the Act is illegal and arbitrary. (iii) That appellant having discharged the burden of proof and in absence of any adverse material/ information on record, the addition u/ s 68 is merely on the basis of conjectures and surmises. 4. That the assessment order is not sustainable on facts and is bad in law.” 8. At the time of hearing, ld. DR of the Revenue submitted that the issue under consideration is cash deposit made by the assessee during demonetization period. He brought to our notice page 2 to page 14 of the assessment order wherein AO has dealt with the issue of cash deposit of amounting to Rs.5,34,50,000/- in detail and AO has also verified the details of cash 11 ITA No.2761/DEL/2023 deposits made by the assessee during demonetization period, gave a clear finding that assessee has deposited huge cash during the demonetization period, assessee has not submitted the reasons for making such huge sale during demonetization period. In this regard, he relied on the detailed findings of AO and objected to the relief granted by the ld. CIT (A). Even for advance received by the assessee from the customers, assessee has not submitted any document in support of the same and not submitted any confirmation from the parties. He relied on the findings of the AO. 9. On the other hand, ld. AR of the assessee submitted that comparative chart of cash and credit sales made during FY 2015-16 and part of FY 2016-17 by M/s/. Basant Jewellers India Private Limited and M/s. Jainsons Jewellers (Prop.) extracted at pages 52 & 53 of the ld. CIT (A) order. He submitted that cash sales are approximately 85-90% of the total sales which is reproduced by the ld. CIT (A) at para 7.7 page 56 of his order. He further submitted that the assessee is not required to keep the KYC of the customers unless the sale is in excess of Rs.2 lakhs. He submitted that onus is on the Revenue to prove that the sales shown by the assessee are bogus and no evidence was found during the survey conducted at the business premises of the assessee that the invoices are predated after announcement of demonetization. He further submitted that the business of trading was started in the month of October 2016 after transfer of stock from the Basant 12 ITA No.2761/DEL/2023 Jewellers India Pvt. Ltd. and sequence of events has been extracted on page 50 of the ld. CIT (A) order. He further submitted that ld. CIT (A) has extensively verified each and every documents and concluded that cash deposits was arising out of cash sales made during the month of October 2016. He submitted that the facts in the present case are exactly similar to the coordinate Bench decision in the case of S. Balaji Mech-Tech (P.) Ltd. (2025) reported in (2025) 170 taxmann.com 639 (Delhi-Trib) dated 25.09.2024. He heavily relied on the findings of the ld. CIT (A). 10. Considered the rival submissions and material placed on record. We observe that the nature of the business of the assessee is trading of gold, diamond and silver jewellery through his proprietorship concern, namely Jainsons Jewellers. It is brought to our notice that the assessee was a director in the erstwhile company, namely, Basant Jewellers India Pvt. Ltd. and the company has continued the same business till AY 2016-17. This company was fully acquired by the assessee and continued to do the same business in the name and style of Jainsons Jewelers as a proprietorship concern. Therefore, the business carried on by the assessee is exactly similar to the business carried out by the erstwhile company. It is brought to our notice that the nature of the business is the same and the terms of dealing with the customers by means of cash and credit sales are exactly similar, the pattern of cash deposits out of the sale proceeds also exactly similar. In this regard, it is 13 ITA No.2761/DEL/2023 brought to our notice comparative chart submitted by the assessee which for the sake of brevity is reproduced below :- 11. From the above chart, we observe that total percentage of cash deposit during AY 2016-17 is 91.67% compared to in the current AY which is 91.34%. The increase in sales during demonetization period is cogent with the fact that the festival period of Diwali falls on the same period i.e. 30.10.2016. Considering the fact and particulars available on record, we observe that the 14 ITA No.2761/DEL/2023 factual matrix in the case of S. Balaji Mech-Tech (P.) Ltd. (supra) are same and coordinate Bench dealt with this issue elaborately as under :- 15. Coming to the other issue of non-substantiation of sale bills with the names and address of the customers, we observed from the sale bills and cash register submitted by the assessee that each cash bills are with the value varies from Rs. 5000 to 18000. When the value is less than Rs. 20,000/- there is no requirement for any assessee to maintain such details like name of the customer and address. This requirement raised by the Ld CIT(A) is also not practical, mere his opinion. 16. Now let us discuss the actual issues raised by the AO that the assessee has recorded sales only during the demonetization period and there is no history of such cash sales in the earlier period. Based on the above observation, he was of the view that the assessee has introduced its own undisclosed cash into the system and booked the cash sales without there being any cash sales. This can be traced if at all the assessee has introduced such unaccounted money into the system, it will show from the financial results or parameters where it can be deducted with: a. Abnormal profit b. No stock movement c. Recording of excess sales From the information submitted before us, all the purchase and sales are properly recorded in the books and also substantiated by the information submitted before the GST officials and relevant quarterly reports. There is absolutely no discrepancies found by the lower authorities either in the stock registers submitted or quarterly reports submission before the GST authorities. 17. Let us analyze the financial results declared by the assessee in the last three years: AY GP Ratio NP Ratio 2015-16 7.10% 0.35% 2016-17 7.14% 0.40% 2017-18 7.27% 0.31% From the above, it is clear that the results declared by the assessee is within the range of book results. The lower authorities has not made any adverse comments nor found any deviations in the book results. 18. Coming to the issue of stock movement and excess sales, we observed that the assessee has submitted relevant stock reconciliation and 15 ITA No.2761/DEL/2023 auditors report of stock movements and there is no negative stock movement which will indicate that the assessee has booked excess sales without there being proper purchases. 19. In our considered view, there are chances that during the demonetization period the regular customers may have chose to buy the spare parts and bearing by making payment by cash so that their excess SBN is transferred. We noticed that the credit sales has come down during this period and the sales of the assessee is more or less maintained during this period. Therefore, it shows that the changes in the patterns recorded in the sales are not abnormal. 20. Whether the recording of cash sales which is already declared in the books of account will attract the deeming provisions of sec.68 or 69A of Act. We observed that the assessee has declared all the cash transactions in its books of account and merely because the cash deposits are more during the demonetization period, whether the CIT(A) can invoke the provisions of section 69A of the Act. As per provisions of the section, it is necessary that the assessee be found with the money, the same is not recorded in the books accounts maintained by it for any source and not offers any explanation or such explanations are not found to be satisfactory to the AO. In this case, the assessee has already declared the cash sales in its books of account and offers the explanation as cash sales, which the lower authorities has accepted it as regular business transactions because they have not rejected the book results and brought to tax the total sales declared by the assessee in its books. Since the cash were already recorded and explanation is already part of the book results, there is no avenue for the CIT(A) to reject such explanations. This expression “explanation is found not satisfactory to the AO” is purely relates to the money found with the assessee which are not recorded in the books of account. In this case, the above expression has no relevance since the assessee had already declared the cash sales in its books. In the similar situation, the coordinate bench has held in the case of J.R.Rice India (P) Ltd as under: “At the cost of repetition, to the extent of sales made, the stock position is also correspondingly reduced by the assessee which goes to prove the genuineness of the claim of the assessee. On examination of the cash book of the assessee, it is found that the assessee had cash balance of Rs. 55.94 lakhs as on 8-11-2016, i.e., the date on which demonetization was announced, which sufficiently explains the source of deposit of Rs. 52.60 lakhs in specified bank notes. Apart from this, the assessee had duly furnished the month wise details of sales, month wise details of purchase, corresponding freight charges incurred month wise, month wise power and fuel expenses and month wise selling expenses in the form of rebate and discount. The assessee also 16 ITA No.2761/DEL/2023 furnished the quantitative details of goods month wise for rice, sugar, chana dal and wheat flour before the Assessing Officer. All these facts clearly go to prove the genuineness claim made by the assessee that cash deposits of Rs.52.60 lakhs has been made out of cash balance available with the assessee and, hence, there is absolutely no case made out by the revenue for making addition under section 68.” Further, in the case of Fine Gujaranwala Jewellers Vs.ITO (ITA No.1540/Del/2022 dated 27.03.2023, wherein it was held as under: 22. In the case in hand the reason for disbelieving the cash deposit is that the assessee has been deposited below Rs. 2 lakh in every transactions that lead to the conclusion of the Assessing Officer that the same has been done to avoid the application of provision of section 285BA read with Rule 114E of the Act. The said observation made by the Assessing Officer without any material in his hand. There is no prohibition under law to make sale transaction below Rs. 2 lakhs as such the assessee had at liberty to manage his own affairs. From the action of the assessee in raising the sales bill below Rs. 2 lakhs the Assessing Officer cannot interpret as the sale are bogus only to give color to non- genuine transaction as genuine transaction. 5The evidence brought on record by the Assessing Officer are not enough to hold that sales were not genuine. More so, the other wing of the Govt has already accepted the sale transaction under VAT, hence, the Assessing Officer is precluded from making contrary findings on the issue when the sales are not doubted. The other contention of the ld DR is that the assessee has not maintaining stock register properly and date wise stock position are not given. The Assessing Officer made the said observation without rejecting the books of account form which true profit and loss accounts could be ascertained and there is no quarrel on this issue. The lower authorities cannot place reliance on the circumstantial evidence which is only conjectures and surmises and the said approach of the ld CIT(A) is devoid of merit it deserves to be rejected. Further, the income of the assessee has to be computed by the Assessing Officer on the basis of available material on record and it is very important to have a direct evidence to make an addition rather than circumstantial evidence. When the assessee gives any reply or submission or any documents to the Assessing Officer, it is duty of the Assessing Officer to examine the same in the light of the available evidence. In the present case the Assessing Officer and the ld CIT(A) have concluded the findings on the basis of conjectures and surmises. The Assessing Officer 17 ITA No.2761/DEL/2023 has to establish the link between the evidence collected by him and the addition to be made. The entire case has to be dependent on the Rule of evidence, the assessee in this case explained the source of bank deposits are from cash sales. The Assessing Officer proceeded to disbelieve the explanation of the assessee on the presumption basis without bringing the corroborative material on record. The Assessing Officer is required to act fairly as reasonable person and not arbitrarily capriciously. The assessment should have been made based on the adequate material and it should stand on its own leg. The Assessing Officer without examining any parties to whom the goods are sold by the assessee, came to conclusion that the sales are not genuine, without even rejecting the books of account which is in our opinion is erroneous. 21. Respectfully, following the above decisions, we are inclined to allow the grounds raised by the assessee with the observation that the AO/CIT(A) cannot invoke the provisions of section 68 or 69A when the assessee is already declared the source for cash deposits in the books of accounts and the lower authorities without their being any material to support on their contrary view, the provisions of section 68 or 69A cannot be invoked. 22. In the result, appeal filed by the assessee is allowed.” 12. Respectfully following the aforesaid decision and relying on the detailed findings of the ld CIT (A), we do not see any reason to disturb the findings of the ld. CIT (A) Accordingly, ground nos.1 & 2 raised by the Revenue are dismissed. 13. With regard to ground no.3, we observe that during assessment proceedings, AO observed that assessee has taken advances from its customers to the extent of Rs.35,75,988/-. Since no confirmation was filed by the assessee before the AO he considered the same as unexplained cash credit u/s 68 of the Act read with section 115BBE. However, during first appellate authority and also before us, assessee filed paper book with the submission that 18 ITA No.2761/DEL/2023 assessee has considered the same as sales in the subsequent assessment year and assessee has filed relevant papers before ld. CIT (A) and has considered the same and verified on sample basis, found it to be in order. Therefore, the abovesaid documents were found to be trading receipt and there is no basis to treat the same as unexplained credit in its books of account. Ld. CIT (A) having co-terminus power has verified the abovesaid information submitted before him and found the same in order, therefore, we do not see any reason to disturb the same. Accordingly, ground no.3 raised by the Revenue is dismissed. 14. Ground No.4 is general in nature, hence not adjudicated. 15. In the result, the appeal filed by the Revenue is dismissed. Order pronounced in the open court on this 16th day of July, 2025. Sd/- sd/- (SATBEER SINGH GODARA) (S. RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated : 16.07.2025 TS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "