Case Law Analysis
|Income Tax Appellate Tribunal
Section 69A IT Act | Peak Credit Theory Must Apply to Unexplained Cash Deposits When No Books Are Maintained : ITAT Agra
When a taxpayer in the informal sector declares business income but maintains no books, the ITAT Agra rules that unexplained cash deposits cannot be fully added under Section 69A without applying the peak credit theory. This ensures fair assessment by focusing on the highest balance reached during the year, not total inflows - a critical safeguard for small traders and cash-based businesses.