Tax Tribunal Deletes Addition Over Rs 3.69 Crore Bangle Business Cash Deposits
Income tax authorities faced a setback when the tribunal removed an addition of Rs 3.69 crore made for bank deposits. The taxpayer acted merely as a commission agent handling cash for bangle traders. The tribunal ruled that deposits linked to a commission business cannot be treated as unexplained income without proof of ownership.
Effective Not specified in the update
For professionals: Advise clients who manage cash for others to maintain meticulous records and ledgers. · Note that the tribunal established the funds belonged to the traders rather than the taxpayer, as deposits were directly connected to a commission-based business operation. · Recognize that the tax authorities had treated the Rs 3.69 crore bank deposits as unexplained income under Section 69A of the Income Tax Act.
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