Shri Shashikant Gulabchand Lodariya, RAJKOT-GUJARAT V. The Income Tax Officer, Ward-2(3), RAJKOT-GUJARAT

CO 15/RJT/2010

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8394 (ITAT-RAJKOT)
• Duration Of Justice: 3 year(s) 14 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 18-03-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 04-01-2013
• Assessment Year: 2001-2002
• Appeal Filed On: 05-03-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AVINASH KUMAR I
• Assessee Lawyers: DR ADHIA
• Keywords: Unexplained cash credit; Rejection of books of accounts; Unexplained investment; Unexplained expenditure; Additional evidence
• Section: 68

Judgement Text

E, IN THE INCOME TAX APPELLATE TRIBU N AL; RAJKOT BENCH, RAJKOT. N.. T, \R # . . # , # BEFORE SHRI T. K. SHARMA, JM AND SHRI D. K. SRIVASTAVA, AM IT A NO . 651 /RJT/20 10 . I I / ASSESSMENT YEAR - 200 5 - 06 INCOME TAX OFFICER WARD 2(3), AAYAKAR BHAVAN, ROOM NO.405, 4 TH FLOOR, RACE COURSE R ING R OAD, RAJKOT. ( S / APPELLANT) VS. SHRI SHASHIKANT GULABCHAND LODARIYA, PROP. OF M/S SHASHIKANT GULABCH AND H - 27, MARKETING YARD, RAJKOT, PAN: AAMPL8314Q S / RESPONDENT C.O.NO.15/RAJ/2010 IN IT A NO .651/RJT/2010. I I / ASSESSMENT YEAR - 200 5 - 06 SHRI SHASHIKANT GULABCHAND LODARIYA, ( S / CROSS - OBJECTOR ) VS. INCOME TAX OFFICER WARD 2( 3), S / RESPONDENT I / REVENUE BY SHRI AVINASH KUMAR I /ASSESSEE BY SHRI. D R ADHIA / DATE OF HEARING 4 .1.2013 / DATE OF PRONOUNCEMENT 18 . 3 .2013 / ORDER N.. T, \R : \OOI / T. K. SHARMA, J. M THIS APPEAL OF THE REVENUE AND CROSS - OBJECTION BY THE ASSESSEE ARE AGAINST THE ORDER OF THE LD. CIT(A) - RAJKOT , DATED 13.11.2009 FOR THE ASSESSMENT YEAR 2005 - 06. SINCE APPEAL OF THE REVENUE AND CROSS - OBJECTION ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 2 THERETO ARISIN G OUT OF THE ORDER OF THE LD. CIT(A), THESE WERE HEARD TOGETHER AND FOR THE SAKE OF CONVENIENCE ARE DECIDED BY THIS CONSOLIDATED ORDER. 2. THE GROUNDS RAISED BY THE REVENUE IN ITS APPEAL READ AS UNDER: 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS I N PARTLY DELETING THE ADDITION (RS.7,19,569/ - ) MADE ON ACCOUNT OF ESTIMATE OF NET PROFIT. 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT U/S 69B OF THE IT ACT OF RS.3,88,820/ - 3. THE L D. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED CREDIT U/S 68 OF THE IT ACT OF RS.2,05,000/ - 3. THE GROUNDS RAISED BY THE ASSESSEE IN HIS CROSS - OBJECTION ARE AS UNDER : 1. THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN UPHOLDING THE ADDITION ON ACCOUNT OF ESTIMATED NET PROFIT TO THE EXTENT OF RS.2,77,565/ - . ON FACTS AND CIRCUMSTANCES OF THE CASE THE NET PROFIT AS PER THE ACCOUNT OF THE ASSESSEE OUGHT TO HAVE BEEN ACCEPTED AS SUCH. 2. THE LD. CIT(A) HAS RI GHTLY DELETED THE ADDITION OF RS.3,88,820/ - MADE U/S 69B AND RS.2 , 05 , 000/ - MADE U/S 68. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE OR DER OF THE LD. CIT(A) SO FAR AS RELATES TO DELETING THE TWO ADDITION MAY KINDLY BE UPHELD 4 . THE FACTS RELATING TO CONTROVERSY INVOLVED IN GROUND NO.1 OF REVENUES APPEAL AND GROUND NO.1 OF CROSS - OBJECTION ARE THAT FOR THE ASSESSMENT YEAR UNDER APPEAL, THE ASSESSEE FILED RETURN OF INCOME ON 30.10.2005 DECLARING TOTAL INCOME OF RS.2,21,260/ - . DURING THE COURSE O F ASSESSMENT PROCEEDINGS, THE ASSESSEE FAILED TO PRODUCE THE BOOKS ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 3 OF ACCOUNTS OF BUSINESS OF PROPRIETARY CONCERN M/S SHASHIKANT GULABCHAND AT MARKETING YARD, RAJKOT. IN THIS PROPRIETARY CONCERN, THE BUSINESS OF THE ASSESSEE CONCERN IS WHOLESALE TRADING IN GRAINS, OIL RICE, JAGGERY AND ALLIED ITEMS. SINCE THE BOOKS OF ACCOUNT WAS NOT PRODUCED , THE AO ESTIMATED THE NET PROFIT AT THE RATE OF 1% ON TOTAL TURNOVER OF RS.9,87,39,576/ - WHICH IS DETERMINED A T RS.9,97,134/ - AS AGAINST NET PROFIT RATE OF .02 % DECLARED BY THE ASSESSEE. ON APPEAL, BEFORE THE LD. CIT(A), THE ASSESSEE SUBMITTED THAT BEFORE THE AO, THE ASSESSEE PERSONALLY APPEARED AND PRESENTED BOOKS OF ACCOUNT BUT BECAUSE OF SOME MISUNDERSTANDING OR WHATSOEVER, THE AO HAS STATED THAT BOO KS WERE NOT PRODUCED. IT WAS FURTHER SUBMITTED THAT BOOKS OF ACCOUNTS WERE AUDIT ED U/S 44AB AND THE SAME WERE WITH HIM IN THE ASSESSMENT PROCEEDINGS. IT WAS ALSO SUBMITTED THAT REGULAR ITEM - WISE QUANTITY ACCOUNT IS MAINTAINED, PURCHASED /SALES BILLS ARE MAINTAINED, VOUCHERS OF EXPENSES ARE WELL AVAILABLE WITH THE ASSESSEE AND TH E ASSESSEE ASSURES TO PRODUCED IT AT ANY TIME WHEN ASKED FOR. 5 . ON THE BASIS OF AFORESAID SUBMISSIONS, VIDE HIS LETTER DATED 15.7.2008 SENT ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE TO SUBMIT REPORT UNDER RULE 46A OF THE INCOME TAX RULES, 1962 BY 30.7.2 0 08. THE AO VIDE HIS REPORT DATED 6.8.2008 OBJECTED TO THE ADMISSION OF THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE. THE AO ALSO REITERATED THAT NO SUCH BOOKS OF A CCOUNTS WERE PRODUCED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS . THE LD. CIT(A) VIDE LETTER DATED 1.9.2008 ASKED THE ASSESSEE TO FILE REJOINDER ON THE OBSERVATIONS OF THE AO BY 10.9.2008 . IN REPLY, THE ASSESSEE ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 4 VIDE LETTER DATED 12.1 1.2008 SUBMITTED THAT BOOKS OF ACCOUNT OF THE ASSESSEE ARE AUDITED U/S 44AB OF THE ACT AND WERE PRODUCED BEFORE THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS. ON THE REPLY OF THE ASSESSEE, THE AO FURTHER CONTENDED THAT NO BOOKS OF ACCOUNTS WERE PRODUCED BEFORE THE AO. IN SUPPORT OF THIS, THE AO REPRODUCED THE REMARK MADE IN THE NOTING DURING THE COURSE OF ASSESSMENT PROCEEDINGS. AFTER CONSIDERING THE SUBMISSIONS OF BOTH SIDES, IN THE IMPUGNED ORDER, THE LD. CIT(A) VIDE PARAGRAPH 3.3 AT PAGER 4 OF HIS ORDER APPLIED NET PROFIT RATE AT 0.50% AND WORKED OUT THE NET PROFIT AT RS.4 , 93 , 698 / . THE RELEVANT PARAGRAPH 3.3 OF THE CIT(A)S ORDER IS REPRODUCED BELOW: 3.3 I HAVE CAREFULLY CONSIDERED THE FINDING GIVEN BY THE AO, THE SUBMISSION/REJOINDER FI LED BY THE AR OF THE APPELLANT AND THE REMAND REPORT OF THE AO. KEEPING IN VIEW THE FACTS AND THE SUBMISSION, IT IS FOUND THAT THE APPELLANT, WHO IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF WHOLESALE TRADING IN SUGAR, OIL, JIGGERY, GHEE , GRAINS, AND R ECOVE RY ETC. A COPY OF AUDITED ACCOUNTS WAS FILED T O SHOW THAT ACCOUNTS OF THE APPELLANT ARE AUDITED ACCOUNTS . IT IS EXPLAINED THAT APPELLANTS BOOKS OF ACCOUNTS ARE AUDITED U/S 44AB OF THE ACT AND ALL THE REGULAR ITEM - WISE QUANTITY ACCOUNTS ARE MAINTAINED, PURCHASES /SALES BILLS ARE MAINTAINED AND ALL THE BILLS AND VOUCHERS AR E ALSO KEPT AND MAINTAINED IT IS FOUND THAT APPELLANT HAS DECLARED INCOME OF RS.2 , 21 , 260/ - IN THE RETURN OF INCOME FILED. THE AUDITED ACCOUNTS SHOW NET PROFIT AT 0.22% WHEREAS THE AO H AS ESTIMATE THE NET PROFIT AT 1% WITHOUT CITING ANY BASIS OR GIVING ANY COMPARABLE CASE. THE AO HAS ALSO NOT REJECTED THE BOOKS OF ACCOUNTS U /S 145(3) OF THE ACT, BUT MERELY ON THE GROUND THAT BOOKS OF ACCOUNTS ARE NOT PRODUCED, PROCEEDED TO ESTIMATE TH E NET PROFIT AT 1% WITHOUT ANY BASIS. AS THE ESTIMATION OF NET PROFIT IS DEVOID OF ANY MERITS, SAME DESERVES TO BE DELETED. HOWEVER, KEEPING IN VIEW THE FACTS THAT AO WAS PREVENTED FROM MAKING INQUIRIES TO A CERTAIN ADDITION DESERVES TO BE CONFIRMED. T HE NET PROFIT SHOWN AT 0.22% IS APPARENTLY LOW. IT IS REASONABLE TO ESTIMATE THE NET PROFIT AT 0.50% ON A TOTAL TURNOVER OF RS.9,87,39,576/ - . ACCORDINGLY, THE NET PROFIT OF 0.50% IS APPLIED AND THE NET PROFIT IS WORKED OUT AT RS.4,93,698/ - AS AGAINST W HICH THE APPELLANT HAS SHOWN NET PROFIT OF RS.2,16,133/ - , THEREFORE, THE REST OF AMOUNT OF RS.2,77,565/ - (493698 - 216133) ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 5 IS BEING CONFIRMED AND REST OF ADDITION OF RS.7 , 19 , 569/ - (997134 - 277565) IS HEREBY ORDERED TO BE DELETED. APPELLANT GETS RELIEF OF RS.7 , 19 , 569 6. AT THE TIME OF HEARING, SHRI AVINASH KUMAR, THE LD. DR APPEARED ON BEHALF OF THE REVENUE AND POINTED OUT THAT BEFORE THE AO, NO BOOKS OF ACCOUNTS WERE PRODUCED BY THE ASSESSEE. EVEN BEFORE THE LD. CIT(A), THE ASSESSEE HAS NOT PRODUCED BO OKS OF ACCOUNTS, THEREFORE, THE LD. CIT(A) SHOULD HAVE CONFIRMED THE ACTION OF THE AO. AS AGAINST THIS, THE SHRI D.R.ADHIA, ATP APPEARED ON BEHALF OF THE ASSESSEE AND CONTENDED THAT EVEN NET PROFIT RATE AT THE RATE OF 0.50% APPLIED BY THE LD. CIT(A) I S EXCESSIVE KEEPING IN VIEW OF THE NET PROFIT DECLARED BY THE ASSESSEE AND ACCEPTED BY THE DEPARTMENT IN THE EARLIER YEARS WHICH WAS VARYING BETWEEN THE RANGE FROM 0.22% TO 0.35% WHICH AS UNDER : AY TURNOVER G P GP% NP NP% 2005 - 06 UNDER APPEAL 98739576 5 55913 0.56% 216133 0.22% 200 4 - 0 5 7042727698 500781 0.71% 166365 0.24% L 200 3 - 04 63392282 479197 0.76% 166482 0.26% 200 2 - 03 510955510 434241 0.85% 179662 0.35% 200 1 - 02 45008641 417544 0.93% 106900 0.24% THE ATP CONTENDED THAT THE NP DECLARED BY THE ASSESSEE FOR THE ASSESSMENT YEAR UNDER APPEAL ARE COMPARED WITH THE NP DECLARED IN THE EARLIER YEARS , THEREFORE, THE AO OUGHT TO HAVE ACCEPTED THE BOOK RESULT BECAUSE THE BOOKS OF ACCOUNT OF THE ASSESSEE ARE AUDITED U/S 44AB OF THE ACT. ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 6 7 . AFTER HEARI NG BOTH THE PARTIES, WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT NEITHER BEFORE THE AO NOR BEFORE THE LD. CIT(A), THE ASSESSEE HAS PRODUCED BOOKS OF ACCOUNTS . IT IS WELL SETTLED LAW IN CAS E THE BOOK OF ACCOUNT ARE EITHER NOT PRODUCED OR REJECTED BY THE AO THEN AO HAS NO OPTION BUT TO ESTIMATE THE INCOME KEEPING IN VIEW OF THE PAST HISTORY OF THE CASE. THE TURNOVER DECLARED BY THE ASSESSEE IN THE ASSESSMENT YEAR UNDER APPEAL AS PER AUDIT REPORT U/ S 44AB IS RS.9,87,39,576/ - . IN THE ASSESSMENT YEAR 2002 - 03, THE TURNOVER DECLARED BY THE ASSESSEE IS 0.35%. KEEPING IN VIEW THE PAST HISTORY OF THE CASE, WE ARE OF THE VIEW THAT THE LD. CIT(A) HAS GIVEN COGENT REASONS FOR APPLYING THE NP RATE OF 0.50% A S AGAINST DECLARED BY THE ASSESSEE 0.022%. WE ARE THEREFORE, INCLINED TO UPHOLD THE ORDER OF THE LD. CIT(A). CONSEQUENTLY , THE GROUND NO.1 TAKEN BY THE REVENUE AND ALSO THE GROUND NO.1 TAKEN BY THE ASSESSEE IN ITS CROSS - OBJECTION IS DISMISSED. 8 . BRIE F FACTS RELATING TO CONTROVERSY RAISED IN GROUND NO.2 OF REVENUES APPEAL ARE THAT THE ASSESSEE PURCHASED SANTRO CAR FOR RS.3,36,012/ - . THE AO ASKED THE ASSESSEE TO PRODUCE SOURCE OF INCOME IN RESPECT OF PURCHASE OF THIS CAR AND PURCHASE OF PULSAR FOR RS.52,808/ - . AS PER THE AO, THE ASSESSEE FAILED TO PRODUCE DETAILS OF THESE PURCHASES. THEREFORE, THE AO MADE DISALLOWANCE OF RS.3,88,820/ - U/S 69B OF THE ACT AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. BEFORE THE CIT(A), THE ASSESSEE CONTEND ED THAT THE ADDITION IN RESPECT OF SANTRO CAR AND PULSER MOTORCYCLE IS NOT WARRANTED AS BOTH THESE ITEMS ARE DULY REFLECTED IN THE BOOKS OF ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 7 ACCOUNTS AND THE PAYMENT FOR PURCHASE OF THESE ITEMS HAVE BEEN MADE FROM THE REGULAR FUNDS FLOW OUT OF ASSESSEE S BOOKS. FOR THIS ALSO THE LD. CIT(A) CALLED FOR REMAND REPORT. THE AO IN THE REMAND REPORT SUBMITTED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE FAILED TO PRODUCE BOOKS OF ACCOUNT, THEREFORE, INQUIRY IN RESPECT OF THE SAME COULD NOT BE MADE. AFTER CONSIDERING THE REMAND REPORT, THE REPLY OF THE ASSESSEE, THE LD. CIT(A) DELETED THE ADDITION FOR THE DETAILED REASONS GIVEN IN PARAGRAPH 4.3 WHICH IS REPRODUCED AS BELOW : 4.3 I HAVE CAREFULLY CONSIDERED THE FINDING GIVEN BY THE AO , THE SUBMISSION/REJOINDER FILED BY THE AR OF THE APPELLANT AND THE REMAND REPORT OF THE AO. AS THE BOOKS OF ACCOUNTS OF THE APPELLANT ARE AUDITED U/S 44AB OF THE ACT AND THE INVESTMENT IN THE SANTRO CAR AND PULSAR MOTORCYCLE IS REFLECTED IN THE BOOKS OF ACCOUNTS, AND PAYMENTS HAVE BEEN MADE THROUGH THE BOOKS OF ACCOUNTS, AND BOTH ARE APPEARING AS ASSETS IN THE BALANCE - SHEET ALSO. AS SUCH, THE SOURCE OF BOTH ASSES IS FOUND EXPLAINED AND THE ADDITION MADE BY T HE AO IS DESERVED TO BE DELETED AS THE SAME IS DEVOID OF ANY MERITS. ACCORDINGLY, THE ADDITION OF RS.3,88,820/ - MADE U/S 69B OF THE ACT BY THE AO IS HEREBY ORDERED TO BE DELETED. THIS GROUND OF APPEAL IS ALLOWED. AGGRIEVED WITH THE DELETION OF THE ADDITION OF RS.3,88,820/ - , THE REVENUE IS IN AP PEAL BEFORE THIS TRIBUNAL. 9 . BEFORE US, THE LD. DR POINTED OUT THAT THOUGH THE CIT(A) HAS CALLED THE REMAND REPORT, BUT THE AO HAS NOT EXAMINED THE BOOKS OF ACCOUNT. THEREFORE, THIS ISSUED BE RESTORED TO THE FILE OF THE AO WITH A DIRECTION THAT TH E ASSESSEE SHALL PRODUCE THE BOOKS OF ACCOUNT, THEN THE AO WILL EXAMINE THE SAME AND RE - ADJUDICAT E THE ADDITION OF RS.3,80,820/ - IN ACCORDANCE WITH LAW. THE ATP PLEADED THAT AT THE TIME OF SUBMITTING THE REMAND REPORT THE AO WAS AT LIBERTY TO CALL T HE ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 8 BOOKS OF ACCOUNT. SINCE, HE HAS NOT EXAMINED THE BOOKS OF ACCOUNT, THERE IS NO JUSTIFICATION FOR GIVING ONE MORE INNING TO THE AO. 10 . AFTER HEARING BOTH THE PARTIES, WE FIND THAT BEFORE THE LD. CIT(A) THE ASSESSEE CONTENDED THAT PAYMENT MADE FOR PUR CHASING THE SANTRO CAR AND PULSO R MOTOR CYCLE. THESE PAYMENTS WERE DULY REFLECTED IN THE BOOKS OF ACCOUNTS AND THE PAYMENT FRO THE PURCHASE HAS BEEN MADE FROM THE REGULAR FUNDS FLOW OUT OF ASSESSEES BOOKS. WHILE SUBMITTING THE REMAND REPORT, THE AO HAS NOT EXAMINED THE BOOKS OF ACCOUNTS FROM WHICH THE ASSESSEE MADE PAYMENT. WE, THEREFORE, SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION THAT THE ASSESSEE SHALL PRODUCE THE BOOKS OF ACCOUNTS, CASH BOO KS ETC, THE AO WILL EXAMINED THE PAYMENT OF RS.3,36,012/ - FOR PURCHASE OF SANTRO CAR AND PURCHASE OF PULSAR FOR RS.52,808/ - AND AFTER VERIFICATION AND SATISFACTION, THE AO MAY MAKE ADDITION OF RS.3,88,820/ - IN ACCORDANCE WITH LAW. CONSEQUENTLY, THE GROUND NO.2 OF REVENUES APPEAL FOR STATISTICAL PURPOSE IS ALLOWED. 11 . THE FACTS OF GROUND NO.3 OF REVENUES APPEA L AND GROUND NO.2 OF CROSS - OBJECTION BY THE ASSESSEE ARE THAT IN THE ASSESSMENT ORDER, THE AO MADE THE ADDITION OF RS.2,05,000/ - ON A CCOUNT OF UNEXPLAINED EXPENDITURE U/S 68 OF THE ACT. ON APPEAL, BEFORE THE LD. CIT(A), THE ASSESSEE FILED AN ADDITIONAL EVIDENCE WHICH WERE NOR FILED BEFORE THE AO AND SUBMITTED THAT AS FUNDS CREDITED IN THE ACCOUNTS OF MINOR DARSHAN AND DHAR A S ACCOU NT ARE FROM THEIR OWN BANK ACCOUNT, AS A RESULT OF REDEMPTION/MATURITY OF INVESTMENT MADE BY MINORS MUCH ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 9 EARLIER. THE ASSESSEE APPLIED TO BANK TO OBTAIN THE PASS BOOKS OF MINORS, HOWEVER, THE SAME HAS NOT BEEN RECEIVED YET. THIS ADDITIONAL EVIDENCE W ERE ALSO FORWARDED TO THE AO. THE AO IN THE REMAND REPORT POINTED OUT THAT THE CASE OF THE APPELLANT DOES NOT FALL UNDER ANY OF THE FOUR CIRCUMSTANCES NARRATED UNDER RULE 46A OF THE INCOME TAX RULES, 1962. IT WAS FURTHER SUBMITTED THAT NO BOOKS OF AC COUNTS WERE PRODUCED BY THE ASSESSEE BEFORE THE AO. AFTER CONSIDERING THE CONTENTIONS OF THE AO AND THE SUBMISSIONS OF THE ASSESSEES THE LD. CIT(A) DELETED THE ADDITION FOR THE DETAILED REASONS GIVEN IN PARAGRAPH 5.3 OF HIS IMPUGNED ORDER WHICH READS AS UNDER : 5.3 I HAVE CAREFULLY CONSIDERED THE FINDING GIVEN BY THE AO, THE SUBMISSIONS /REJOINDER FILED BY THE AR OF THE APPELLANT AND THE REMAND REPORT OF THE AO. THE MAIN GROUND OF ADDITION BY THE AO U/S 68 OF THE ACT IS ON ACCOUNT OF APPELLANTS FAILURE TO FILE DETAILS DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND ALSO TO DISCHARGE THE PRIMARY ONUS, WHICH LAY UPON HIM. HOWEVER, DURING THE COURSE OF APPELLATE PROCEEDINGS, THE ADDITIONAL EVIDENCES WERE FILED BY THE APPELLANT AND THE SAME WERE ADM ITTED KEEPING IN VIEW THE FACT THAT THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FORM PRODUCING THE EVIDENCES, WHICH HE WAS CALLED UPON TO PRODUCE BY THE AO. THE COPY OF THE DOCUMENTS FILED TO SHOW THAT THE FUNDS CREDITED IN THE ACCOUNTS OF MINOR DA RSHAN AND DHARA WERE GIVEN BY THEM FROM THEIR OWN BANK ACCOUNTS BY CHEQUES, AND SAME WAS CREDITED IN CC ACCOUNT NO.1151 OF THE APPELLANT ON 9.4.2004. THE SOURCE OF DEPOSITS IN THE ACCOUNTS OF MINOR DARSHAN AND DHARA WERE STATED TO BE A RESULT OF REDEM PTION/MATURITY OF INVESTMENT MADE BY THE MINORS EARLIER. THE COPIES OF THE UNITS OF UTI HELD BY THESE MINOR DARSHAN AND DHARA WERE ALSO FINED TO PROVE THE SOURCE. MINOR DARAHAN AND DHARA ARE THE MINOR SON AND DAUGHTER OF THE APPELLANT. KEEPING IN VIEW ALL ABOVE FACTS, THE IDENTITY, CREDITWORTHINESS OF THE CREDITOR AND GENUINENESS OF THE TRANSACTIONS HAVE BEEN FOUND PROVED, AND THEREFORE, IT IS HELD THAT THE ADDITION OF RS.2 , 05 , 000/ - MADE U/S 68 OF THE ACT IS NOT WARRANTED AND DEVOID OF MERIT . AS SUC H THE SAME IS HEREBY ORDERED TO BE DELETED. THIS GROUND OF APPEAL IS ALLOWED. ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 10 12 . AGGRIEVED WITH THIS THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 13 . AT THE TIME OF HEARING THE DR CONTENDED THAT THE AO HAS BROUGHT ON RECORD, THE PROVISIONS OF RUL E 46A OF THE INCOME TAX RULES 1962 BY WHICH HE HAS STATED THAT THE ASSESSEE HAS FILED ADDITIONAL EVIDENCE BEFORE THE LD. CIT(A) WHICH WAS NOT BEFORE THE AO AND AFTER ADMITTING THIS ADDITIONAL EVIDENCE, THE LD. CIT(A) DELETED THE ADDITION OF RS . 2,05,000 / - MADE U/S 68 OF THE ACT . AS AGAINST THIS THE ATP SUPPORTED THE ORDER OF THE LD. CIT(A). 1 4 . AFTER HEARING BOTH THE SIDES, WE FIND THAT THE LD. CIT(A) ADMITTED THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE AT THE APPELLATE PROCEEDINGS TO WHICH THE AO OBJECTED. WITHOUT SATISFYING THE AOS OBJECTION THE LD. CIT(A) UPHELD THE CONTENTION OF THE ASSESSEE AND DELETED THE ADDITION OF RS.2,05,000/ - . THEREFORE, WE ARE OF THE VIEW THAT THE VERIFICATION OF FACTS ARE NECESSARY AT THE LEVEL OF THE AO TO COME TO A CONCLUSION WHETHER THE ASSESSEE HAS OBSERVED TRUE AND CORRECT PROCEDURE. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD.CIT(A) AND RESTORE THIS ISSUE TO THE FILE OF THE AO FOR VERIFICATION OF FACT. THE ASSESSEE IS ALSO DIRECTED TO PRODUCE RELEVANT DOCU MENT FOR EXPEDITIOUS DISPOSAL OF ISSUE. IN CASE, THE ASSESSEE FAILED TO FURNISH THE DETAILS AS CALLED FOR, THE AO IS AT LIBERTY TO DECIDE THE ISSUE IN ACCORDANCE WITH LAW. FOR STATISTICAL PURPOSE, THE GROUND NO.3 TAKEN BY REVENUE AND GROUND NO.2 TAKEN BY THE ASSESSEE IN ITS CROSS - OBJECTION IS THEREFORE, ALLOWED . ITA NO.651/RJT/2010. C.O.NO.15/RAJ/2010 11 15 . IN THE RESULT, FOR STATISTICAL PURPOSES, REVENUES APPEAL IS PARTLY ALLOWED AND CROSS - OBJECTION FILED BY THE ASSESSEE STANDS PARTLY ALLOWED. T HIS O RDER IS PRONOUNCED IN THE O PEN COURT ON THE DATE MENTIONED HEREINABOVE. SD SD ( CI / D. K. SRIVASTAVA) ( I / T. K. SHARMA) CAT0 / ACCOUNTANT MEMBER I / JUDICIAL MEMBER O/ ORDER DATE 18 . 3 . 2013 . /RAJKOT SRL 8 RJO O / COPY OF ORDER FORWARDED TO: - 1 S / APPELLANT - 2 S / RESPONDENT - 3 E V / CONCERNED CIT 4. V - / CIT (A) . 5 E, E, / DR, ITAT, RAJKOT 6 I / GUARD FILE. / BY ORDER , TRUE COPY SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL, R AJKOT.