Rs 8 lakh cash deposited in bank - man gets tax notice! Assessing officer deems it presumptive business income, but taxpayer wins case in ITAT

Making cash deposits of large amounts in your bank account? Be aware of a case where a cash deposit attracted the attention of the Income Tax Department, and the assessing officer deemed it as presumptive business income. When Mr. Kumar deposited Rs 8.68 lakh in his bank account, he didn’t expect a full-blown tax battle. What began as a simple query over a cash deposit soon snowballed into an intense legal fight — one that went all the way up to the Income Tax Appellate Tribunal (ITAT), Delhi. But Mr Kumar won the case, and here’s what the entire matter was about: Initially, the income tax department treated his case as a “limited scrutiny” — a focused assessment meant only to verify the source of the cash deposit. But during the process, the Assessing Officer (AO) decided to take th