Sir,
It assessess 3 years rs:12 lacs net profit declared in itr returns.but assessess rs:15 lacs fixed deposit in bank account.
Question:
Difference ( rs:15 - 12 lacs) 3 lacs tax applicable in it act.
The ₹3 lakh difference is taxable at an effective rate of 78% (plus potential penalty) under Section 69 read with Section 115BBE only if the taxpayer fails to provide valid proof or a satisfactory explanation for the source of funds. If valid documentation (gifts, loans, or past savings) is produced, no tax applies to the principal difference. Interest earned on the deposit remains separately taxable under Income from Other Sources.