*The Income Tax Appellate Tribunal (ITAT) in Mumbai* recently deleted a ₹5.39 crore addition made by the Assessing Officer (AO) based on a flawed estimation method. Here's what happened: - *The Case:* The AO estimated the assessee's unaccounted income by extrapolating data from just two days' bills, assuming 200 bills were issued daily with an average value similar to the two days' bills. - *The AO's Calculation:* The AO projected the daily turnover for a full year, arriving at an unaccounted cash income of ₹5.39 crore, which was added under Section 69A as unexplained money. - *The ITAT's Decision:* The tribunal strongly condemned the AO's estimation method, stating it "may impress a student of mathematics but does not make any sense so far as the income tax proceedings are concerned". - *Key Finding:* The ITAT concurred with the CIT(A), noting that building a year-long unaccounted turnover based solely on two bills was unjustified, especially since the sales were already declared in the books of the new entity. - *Outcome:* The ITAT deleted the ₹5.39 crore addition, upholding the CIT(A)'s decision. This ruling highlights the importance of relying on substantial evidence and sound estimation methods in income tax proceedings .