M/s. Satluj Service Station P.Ltd., Nawanshahr V. The Asstt. Commissioner of Income-tax, Jalandhar

CO 16/ASR/2013

• Counselvise Citation: [2016] 119 COUNSELVISE.COM (IT) 3374 (ITAT-AMRITSAR)
• Duration Of Justice: 3 year(s) 2 month(s) 7 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 30-06-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 22-06-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 22-04-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: BHAGAT; C R CHOPRA
• Assessee Lawyers: A N MISHRA
• Keywords: Depreciation; Document seized; Principle of natural justice; Additional evidence; Documents seized
• Section: 43B; 153A; 132; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR (CAMP AT JA LANDHAR ) BEFORE SH. A.D.JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A NOS.95 TO 98 (ASR)/2013 ASSESSMENT YEARS: 2006-07 TO 2009-10 ASST. CIT, CENTRAL CIRCLE-II, JALANDHAR. VS. M/S. SUTLEJ SERVICE STATION (P) LTD., BANGA ROAD, NAWANSHAHAR. PAN:AABCS-9095B (APPELLANT) (RESPONDENT) CROSS OBJECTION NOS.13 TO 16 (ASR)/2013 ASSESSMENT YEARS: 2006-07 TO 2009-10 M/S. SUTLEJ SERVICE STATION (P) LTD., BANGA ROAD, NAWANSHAHAR. PAN:AABCS-9095B VS. ASST. CIT, CENTRAL CIRCLE-II, JALANDHAR. (CROSS OBJECTORS ) (RESPONDENT) APPELLANT BY: SH. A.N.MISHRA (DR) RESPONDENT BY: SH. M. R. BHAGAT & SH. C.R CHOPRA (C A) DATE OF HEARING: 22.06. 2016 DATE OF PRONOUNCEMENT : 29.06.2016 ORDER PER T.S.KAPOOR (AM): THESES ARE FOUR APPEALS FILED BY REVENUE AGAINST TH E SEPARATE ORDERS OF LEARNED CIT(A)-I, LUDHIANA, ALL DATED 22. 11.2012 FOR ASST. YEARS: 2006-07 TO 2009-10 RESPECTIVELY. THE ASSESSE E HAS ALSO FILED THE CROSS OBJECTIONS TO THE APPEALS FILED BY REVENUE. ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 2 2. THE GROUNDS OF APPEALS TAKEN BY THE REVENUE IN ALL THESE YEARS ARE ALMOST SIMILAR EXCEPT DIFFERENCE IN FIGURES AND DIFFERENCE IN SOME GROUNDS OF APPEALS. FOR THE SAKE OF CONVENIENCE, TH E GROUNDS OF APPEAL IN ASST. YEAR: 2006-07 ARE REPRODUCED BELOW. 1. THAT LD. CIT(A) HAS ERRED BOTH IN LAW AND ON FA CTS IN DELETING THE ADDITION MADE BY THE AO AMOUNTING TO RS.6,83,260/- ON ACCOUNT OF FALL IN G.P RATE BY ADMITTING ADDITIONAL EVIDENCE HOLDING T HAT THE FIGURE OF SALES CORRECTLY MATCHES WITH THE BOOKS OF ACCOUNTS, KEEPI NG IN VIEW THE SPECIFIC FINDINGS GIVEN IN THE ASSESSMENT ORDER. 2(I). THAT LD. CIT(A0 HAS ERRED BOTH THE LAW AND ON FACTS IN DELETING THE ADDITION MADE BY THE AO AMOUNTING TO RS.2,54,311/- ON ACCOUNT OF DISALLOWANCE OF EXPENSES I.E. INTEREST PAID TO BANK ERS AND DEPRECIATION DEBITED TO P& L ACCOUNT BY ADMITTING ADDITIONAL EVI DENCE HOLDING THAT THE SAME WAS VERIFIED BY AO DURING REMAND PROCEEDINGS, KEEPING IN VIEW THE SPECIFIC FINDINGS GIVEN IN THE ASSESSMENT ORDER. 2(II). THAT LD. CIT(A) HAS ERRED BOTH IN LAW AND ON FACTS IN NOT APPRECIATING THE FACTS THAT THE DIFFERENCE OF RS.1,02,000/- OF S ALARY EXPENSES AND DIRECTOR FEE EXPENSES WAS POINTED OUT BY THE AO IN THE REMAND REPORT PROCEEDINGS. 3. THAT LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE BY THE AO AMOUNTING TO RS.28,30,000/- ON ACCOU NT OF UNEXPLAINED RECEIPTS BY ADMITTING ADDITIONAL EVIDENCE HOLDING T HAT THE ISSUE HAS BEEN EXPLAINED BY THE AO DURING REMAND PROCEEDINGS, KEEP ING IN VIEW THE SPECIFIC FINDINGS GIVEN IN THE ASSESSMENT ORDER. 4. THAT LD. CIT(A) HAS ERRED BOTH IN LAW AND ON FAC TS IN NOT APPRECIATING THE FACTS THAT DURING THE COURSE OF AS SESSMENT PROCEEDINGS, THE ASSESSEE HAD NOT COOPERATED WITH THE DEPARTMENT IN FURNISHING THE INFORMATIONS/EVIDENCE INSPITE OF AFFORDING VARIOUS OPPORTUNITIES AFTER PROVIDING COPIES OF THE CORE INCRIMINATING DOCUMENT S SEIZED/IMPOUNDED AND THIS HAD RESULTED IN AN EX PARTE ASSESSMENT. 5. THAT LD. CIT(A) HAS ERRED BOTH IN LAW AND ON FAC TS IN NOT APPRECIATING THE FACTS THAT WHILE SUBMITTING THE RE MAND REPORT AFTER VERIFYING THE FACTS OF THE CASE, NON-COMPLIANCE ON THE PART OF THE ASSESSEE DURING ASSESSMENT PROCEEDINGS WAS COMMUNICATED TO T HE WORTHY CIT(A0 AND THE AO PARTICULARLY OBJECTED FOR ADMITTING THE ADDITIONAL EVIDENCE AT THE APPELLATE STAGE UNDER RULE 46A OF THE INCOME TA X RULES MENTIONING THAT THE EVIDENCE WHICH WAS NOT PRODUCED DURING ASSESSME NT PROCEEDINGS ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 3 SHOULD NOT BE ALLOWED TO BE PRODUCED AT THE APPELLA TE STAGE IN RESPECT OF ALL THE ADDITIONS DELETED BY THE LD. CIT(A). 6. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND GROUND(S) OF APPEAL ON OR BEFORE THE APPEAL IS HEARD AND DISPOSE D OFF. 7. IT IS PRAYED THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS) BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 4. AT THE OUTSET, THE LEARNED AR SUBMITTED THAT HE WILL NOT BE PRESSING THE CROSS OBJECTIONS FILED BY THE ASSESSE E, THEREFORE, THE CROSS OBJECTIONS FILED BY ASSESSEE BE DISMISSED AS WITHDR AWN. 5. THE LEARNED DR HAD NO OBJECTION TO WITHDRAWAL OF CROSS OBJECTIONS, THEREFORE, THE CROSS OBJECTIONS AS FILE D BY ASSESSEE ARE DISMISSED AS WITHDRAWN. 6. NOW COMING TO THE APPEALS FILED BY REVENUE, WE F IND THAT THE REVENUE IN THESE APPEALS IS MAINLY AGGRIEVED WITH T HE ACTION OF LEARNED CIT(A), BY WHICH HE ALLOWED THE RELIEF TO THE ASSES SEE BY ACCEPTING ADDITIONAL EVIDENCES. 7. THE BRIEF FACTS OF THE CASES AS NOTED IN THE ASS ESSMENT ORDER ARE THAT A SEARCH U/S 132 OF THE ACT WAS CONDUCTED IN T HE CASE OF M/S. SUTLEJ SERVICE STATION (P) LTD., ON 18.02.2010. THEREFORE, THE PROCEEDINGS WERE INITIATED U/S 153A OF THE ACT AND ASSESSMENTS WERE COMPLETED U/S 144 OF THE ACT. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER MADE VARIOUS ADDITIONS. FOR THE SAKE OF CONVENIENCE THESE ARE REPRODUCED BELOW. ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 4 ASST. YEAR: 2006-07 1. ADDITION OF ACCOUNT OF INTEREST PAID TO BANK RS. 6,83,260/- 2. ADDITION ON ACCOUNT OF DISALLOWANCE OF DEPRECIAT ION AND INTEREST PAID TO BANKERS RS.2,54,311/- 3. ADDITION ON ACCOUNT OF UNEXPLAINED RECEIPTS RS.2 8,30,000/- 4. ADDITION DUE TO FALL IN G.P. RATE OF RS.22,53,56 /- ASST. YEAR: 2007-08 1. ADDITION OF ACCOUNT OF INTEREST PAID TO BANK RS. 15,48,832/- 2. ADDITION ON ACCOUNT OF DISALLOWANCE OF DEPRECIAT ION AND INTEREST PAID OF BANKERS RS.6,50,634/- 3. ADDITION TO AD HOC DISALLOWANCE OF EXPENSES.RS. 26,0,253/- 4. ADDITION ON ACCOUNT OF UNEXPLAINED RECEIPTS RS.3 7,00,000/- 5. ADDITION DUE TO FALL IN G.P. RATE 3,52,948/- ASST. YEAR: 2008-09 1. ADDITION DUE TO FALL IN G.P RATE RS.3,52,948/- 1. ADDITION OF ACCOUNT OF INTEREST PAID TO BANK RS. 15,76,535/- 2. ADDITION ON ACCOUNT OF DEPRECIATION AND INTEREST PAID TO BANKERS RS.5,87,672/- 3. ADDITION DUE TO DISALLOWANCE OF EXPENSES RS.23, 50,068/- 4. ADDITION ON ACCOUNT OF UNEXPLAINED RECEIPTS RS.1 2,59,000/- 5. ADDITION DUE TO FALL IN G.P. RATE 7,60,866/- ASST. YEAR: 2009-10 1. ADDITION OF ACCOUNT OF UNEXPLAINED UNSECURED LOA N RS.3,53,300/- 2. ADDITION ON ACCOUNT OF ADVANCE RECEIVED AGAINST SALE OF LAND RS.50,00,000/- 3. ADDITION ON ACCOUNT OF INTEREST PAID TO BANK RS. 15,65,853/- 4. ADDITION ON ACCOUNT OF DEPRECIATION AND INTEREST RS.64,490/- 5. ADDITION OUT OF EXPENSES DISALLOWED RS.2,41,796 /- 8. AGGRIEVED WITH THE ORDERS THE ASSESSEE FILED APP EALS BEFORE LEARNED CIT(A) AND LEARNED CIT(A) ALLOWED RELIEF TO THE ASS ESSEE AFTER ADMITTING THE ADDITIONAL EVIDENCES AND AFTER OBTAINING THE RE MAND REPORT FROM THE ASSESSING OFFICER. ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 5 9. THE LEARNED DR, AT THE OUTSET, SUBMITTED THAT AS SESSEE WAS PROVIDED SUFFICIENT OPPORTUNITY, HOWEVER, HE DID NO T COOPERATE DURING ASSESSMENT PROCEEDINGS AND THEREFORE, THE ASSESSING OFFICER HAD RIGHTLY MADE THE ADDITIONS U/S 144 AND LEARNED CIT(A) SHOUL D NOT HAVE ADMITTED ADDITIONAL EVIDENCES AND SHOULD NOT HAVE ALLOWED RE LIEF TO THE ASSESSEE BASED UPON THE ADDITIONAL EVIDENCES. 10. ON MERITS, THE LEARNED DR, HEAVILY PLACED HIS R ELIANCE ON THE ORDERS OF ASSESSING OFFICER AND SUBMITTED THAT THE ASSESSING OFFICER HAD CLEARLY HELD ABOUT THE ADDITIONS/ DISALLOWANCES. 11. THE LEARNED AR, ON THE OTHER HAND, SUBMITTED TH AT THE FACTS FOR NOT ATTENDING THE ASSESSMENT PROCEEDINGS WERE EXPLAINED TO LEARNED CIT(A) AND LEARNED CIT(A) HAD ACCEPTED ADDITIONAL EVIDENCE S AS THE EVIDENCES WERE RELEVANT FOR DECIDING THE VARIOUS ADDITIONS. I T WAS SUBMITTED THAT THE LEARNED CIT(A) HAS HELD THAT VERY LIMITED OPPOR TUNITY TO EXPLAIN THE CASES WAS PROVIDED TO THE ASSESSEE FROM 14.11.2011 I.E., THE DATE FROM WHICH ASSESSING OFFICER WAS HAVING VALID JURISDICTI ON TO ASSESS THE CASES. IT WAS SUBMITTED THAT LEARNED CIT(A) HAD FURTHER MA DE A FINDING OF FACT THAT NOTICES ISSUED PRIOR TO 14.11.2011 WERE SERVED THROUGH AFFIXTURE AND ASSESSEE CLAIMED THAT SUCH NOTICES WERE NOT REC EIVED, THE LEARNED CIT(A) HAS RIGHTLY ADMITTED THE ADDITIONAL EVIDENCE S. 12. AS REGARDS THE RELIEF ALLOWED BY LEARNED CIT(A) ON MERITS, THE LEARNED AR HEAVILY PLACED HIS RELIANCE ON THE ORDER OF LEARNED CIT(A). ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 6 13. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE T HROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT IT IS A FAC T THAT ASSESSEE DURING THE ASSESSMENT PROCEEDINGS DID NOT COOPERATE WITH T HE ASSESSING OFFICER IN CARRYING OUT THE ASSESSMENT PROCEEDINGS. THE REA SON GIVEN BY ASSESSEE FOR NOT ATTENDING THE PROCEEDINGS WAS THAT THE ASSESSING OFFICER HAD GIVEN VERY LIMITED TIME TO FILE THE NECESSARY D ETAILS. THE LEARNED CIT(A) HAS ALSO MADE A FINDING OF FACT THAT CIT HAD FINALLY PASSED THE ORDER CENTRALIZING THE CASES W.E.F., 14.11.2011 AND THE ASSESSMENT OF THE CASES OF THE ASSESSEE WERE COMPLETED ON 20.12.2011, THEREFORE, THE TIME AVAILABLE WITH THE ASSESSEE TO FILE NECESSARY DOCUM ENTS WITHIN THE TIME WERE VERY SHORT AND THEREFORE, KEEPING IN VIEW THE RULES OF NATURAL JUSTICE AND KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASES THE LEARNED CIT(A) HAS RIGHTLY ADMITTED THE ADDITIONAL EVIDENCE S. THESE ADDITIONAL EVIDENCES WERE AT THE ROOT OF ADDITIONS, THEREFORE, THE CONSIDERATION OF THE SAME WERE NECESSARY FOR THE DISPOSAL OF CASES. MORE OVER, LEARNED CIT(A) HAS DECIDED THE CASES AFTER OBTAINING REMAND REPORT FROM THE ASSESSING OFFICER. THEREFORE, WE DO NOT SEE ANY INFIRMITY IN THE ORDERS OF LEARNED CIT(A) AS REGARDS THE ADMISSION OF ADDITIONAL EVIDE NCES. 14. NOW COMING TO THE MERITS OF THE ADDITIONS, WE F IND THAT AFTER OBTAINING WRITTEN SUBMISSIONS FROM ASSESSEE LEARNED CIT(A) SUBMITTED THE SAME TO THE CIT(A) AND AFTER OBTAINING THE REPO RT FROM ASSESSING OFFICER, HE HAD ALLOWED RELIEF TO THE ASSESSEE. TH E YEARWISE REMAND ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 7 REPORT OF ASSESSING OFFICER AS PLACED IN THE PAPER BOOK IS REPRODUCED BELOW. ASST. YEAR: 2006-07 THE PURCHASE OF RS.4,44,34,247/- HAS TALLIED. HOWE VER, THERE IS DIFFERENCE BETWEEN THE SALES IN COMPARISON WITH BOO KS OF AC/PRODUCED AND THE BALANCE SHEET SUBMITTED BY THE ASSESSEE WHI CH AMOUNTS TO RS.56213/- (45219600-45163467). THIS DIFFERENCE SHO ULD BE CONSIDERED FOR ADDITION. (I) INTEREST PAID TO BANKS. THE INTEREST PAID TO THE BANKS IS AS PER BOOKS OF A CCOUNTS OF THE ASSESSEE WHICH AMOUNTS TO RS.683260/-. THIS FACT WA S VERIFIED. EVEN THE BANK ACCOUNT WHICH WAS FILED BY THE ASSESSEE CO NFIRMS THE PAYMENTS OF INTEREST. THE ADDITION MAY BE DECIDED O N MERITS. (II) PROFIT AND LOSS EXPENSES THE EXPENSES DEBITED TO PROFIT AND LOSS ACCOUNT ARE AS PER THE BOOKS OF ACCOUNT WHICH WERE VERIFIED BY THE INSPECTORS. T HE EXPENSES ON ACCOUNT OF SALARY, POSTAGE, DIRECTORS, FEES, FILING FEES, ELECTRICITY EXPENSES AND BANKS CHARGES, ETC. WHICH WERE BOOKED BY THE ASSESSEE ARE EXPENSES OF THE NATURE OUT OF WHICH NO AD HOC D ISALLOWANCE CAN BE CONSIDERED. THE ADDITION MAY BE DECIDED ON MERIT S. AS PER BOOKS AS PER BALANCE SHEET SALARY 254400/- 176400/- POSTAGE 4565/- 4351/- DIRECTOR FEE 36000/- 12000/- TANKERS EXPENSES 123093 123093/- (III) ADDITION ON ACCOUNT OF ROUGH PAPERS OF K.C. PALACE SHRI PREM PAL GANDHI IS PROPRIETOR OF K.C. PALACE, NAWANSHAHAR. INCOME EARNED FROM K.C. PALACE HAS BEEN SHOWN BY SH RI PREM PAL GANDHI IN HIS RETURN OF INCOME. THE PAPERS SEIZED F ROM THE RESIDENCE OF SHRI PREM PAL GANDHI WERE SCRUTINIZED AND ADDITI ONS WERE MADE IN HIS INCOME EARNED FROM K.C. PALANCE, NAWANSHAHR. SI NCE SH. PREM PAL GANDHI IS A SEPARATE TAX ENTITY, THE ADDITION M ADE ON THIS GROUND MAY BE CONSIDERED FOR DELETION. ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 8 ASST. YEAR: 2007-08 BOOKS OF ACCOUNTS FOR THE A.Y.2007-08 HAVE NOT BEE N PRODUCED BY THE ASSESSEE. FURTHER THEY DO NOT FORM PART OF THE SEIZED DOCUMENTS. THE ASSESSEE COULD NOT PRODUCED THESE BOOKS EVEN DURING THE ASSESSMENT PROCEEDINGS. IN VIEW OF THIS FACT, THE ADDITIONS MADE BY THE AO NEED TO BE SUSTAINED. (I) TRADING ACCOUNT ADDITION THE SALES AND THE PURCHASE TALLIED WITH THE BOOKS O F ACCOUNTS. AS PER GENERAL INFORMATION, THE PETROL DEALERS GET COMMISS ION ON SALE. THE PURCHASE AND SALE PRICES ARE CONTROLLED BY THE PETR OLEUM COMPANIES AND GOVERNMENT AGENCIES. EVEN THE DEPARTMENTS OF WE IGHTS AND MEASURES CHECKS THE MEASUREMENT AND METERS OF THE P ETROL PUMPS. THE TRADING ACCOUNT ADDITIONS MAY BE DECIDED ON MER ITS. (II) INTEREST PAID TO BANKS THE INTEREST PAID TO THE BANKS IS AS PER BOOKS OF A CCOUNTS OF THE ASSESSEE. THIS FACT WAS VERIFIED. EVEN THE BANK ACC OUNT WHICH WAS FILED BY THE ASSESSEE, CONFIRMS THE PAYMENTS OF INT EREST. THE ADDITION MAY BE DECIDED ON MERITS. (III) PROFIT AND LOSS EXPENSES THE EXPENSES DEBITED TO PROFIT AND LOSS ACCOUNT ARE AS PER THE BOOKS OF ACCOUNT WHICH WAS VERIFIED BY THE INSPECTORS. TH E EXPENSES ON ACCOUNT OF SALARY, POSTAGE, DIRECTORS FEES, FILING FEES, ELECTRICITY EXPENSES AND BANKS CHARGES, ETC. WHICH WERE BOOKED BY THE ASSESSEE ARE EXPENSES OF THE NATURE OUT OF WHICH NO AD HOC D ISALLOWANCE CAN BE CONSIDERED. THE ADDITION MAY BE DECIDED ON MERIT S. (IV) ADDITION ON ACCOUNT OF ROUGH PAPERS OF K.C. PALACE. SHRI PREM PAL GANDHI IS PROPRIETOR OF K.C. PALACE, NAWANSHAHAR. INCOME EARNED FROM K.C. PALACE HAS BEEN SHOWN BY SH RI PREM PAL GANDHI IN HIS RETURN OF INCOME. THE PAPERS SEIZED F ROM THE RESIDENCE OF SHRI PREM PAL GANDHI WERE SCRUTINIZED AND ADDITI ONS WERE MADE IN HIS INCOME EARNED FROM K.C. PALACE, NAWANSHAHAR. SI NCE SH. PREM PAL GANDHI IS A SEPARATE TAX ENTITY, THE ADDITION M ADE ON THIS GROUND MAY BE CONSIDERED FOR DELETION. ASST. YEAR 2008-09 (I) TRADING ACCOUNT ADDITION ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 9 THERE IS DIFFERENCE BETWEEN THE SALES IN COMPARISON WITH BOOKS OF AC/PRODUCED AND THE BALANCE SHEET SUBMITTED BY THE ASSESSEE WHICH AMOUNTS TO RS.172528/- (43165114-42992586). THIS DI FFERENCE OF RS.172528/- SHOULD BE CONSIDERED FOR ADDITION. (II) INTEREST PAID TO BANKS THE INTEREST PAID TO THE BANKS IS AS PER BOOKS OF A CCOUNTS OF THE ASSESSEE WHICH AMOUNTS TO RS.1576534/-. THIS FACT W AS VERIFIED. EVEN THE BANK ACCOUNT WHICH WAS FILED BY THE ASSESS EE CONFIRMS THE PAYMENTS OF INTEREST. THE ADDITION MAY BE DECIDED O N MERITS. (III) PROFIT AND LOSS EXPENSES THE EXPENSES DEBITED TO PROFIT AND LOSS ACCOUNT ARE NOT AS PER THE BOOKS OF ACCOUNT WHICH WAS VERIFIED BY THE INSPECTO RS. THE EXPENSES ON ACCOUNT OF SALARY, POSTAGE, DIRECTORS FEES, FILI NG FEES, ELECTRICITY EXPENSES AND BANKS CHARGES, ETC. WHICH WERE BOOKED BY THE ASSESSEE VARY FROM THE BOOKS OF ACCOUNTS PRODUCED FOR VERIFI CATION. AS PER BOOKS AS PER BALANCE SHEET SALARY 29,3,530/- 143530/- POSTAGE 7114/- 7392/- DIRECTOR FEE 36000/- NIL TANKERS EXPENSES 112453/- 112453/- FROM THE ABOVE, IT CAN BE SEEN THAT THE ASSESSEE;S BOOKS WHICH ARE PRODUCED NOW ARE NOT RELIABLE BECAUSE THE AMOUNTS O F EXPENSES VARY. NO SUPPORTING VOUCHERS HAVE BEEN PRODUCED FOR VERIFICA TION. HENCE ALL THE ADDITIONS MADE BY THE AO ON ALL THE GROUNDS SHOULD BE SUSTAINED. (IV) ADDITION ON ACCOUNT OF ROUGH PAPERS-OF K.C. PALACE SHRI PREM PAL GANDHI IS PROPRIETOR OF K.C. PALACE, NAWANSHAHAR. INCOME EARNED FROM K.C. PALACE HAS BEEN SHOWN BY SH RI PREM PAL GANDHI IN HIS RETURN OF INCOME. THE PAPERS SEIZED F ROM THE RESIDENCE OF SHRI PREM PAL GANDHI WERE SCRUTINIZED AND ADDITI ONS WERE MAE IN HIS INCOME EARNED FROM K.C. PALACE, NAWANSHAHAR. SI NCE SH. PREM PAL GANDHI IS A SEPARATE TAX ENTITY, THE ADDITION M ADE ON THIS GROUND MAY BE CONSIDERED FOR DELETION. ASST. YEAR 2009-10 (I) TRADING ACCOUNT ADDITION ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 10 THERE IS DIFFERENCE BETWEEN THE SALES IN COMPARISON WITH BOOKS OF AC/PRODUCED AND THE BALANCE SHEET SUBMITTED BY THE ASSESSEE WHICH AMOUNTS TO RS.301918/- (49700368-49398450). THIS DI FFERENCE OF RS.301918/- SHOULD BE CONSIDERED FOR ADDITION. (II) SUNDRY CREDITORS ADDITION SHRI PREM PAL GANDHI WHO ADVANCED A LOAN OF RS.35,0 3,300/- BY CHEQUE IS A SHARE HOLDER OF THE COMPANY. HOWEVER, F ROM THE ACCOUNT OF MR. PREM PAL GANDHI FILED, IT IS SEEN THAT AN AM OUNT OF RS.32,50,000/- HAS BEEN PAID BY HIM. HOWEVER, THE A SSESSEE IS SHOWING ONLY RS.35,03,300/-. THEREFORE, THE DIFFERE NCE OF RS.2,53,300/- SHOULD BE CONSIDERED FOR ADDITION. (III) ADDITION ON SALE OF LAND THE ASSESSEE COMPANY RECEIVED ADVANCE OF RS.50,00,0 00/- FOR SALE OF LAND FROM M/S K.C. SOCIAL WELFARE TRUST (REGD.), NA WANSHAHAR. THIS PAYMENT WAS VERIFIED FROM BANK ACCOUNT OF THE TRUST IN CENTRAL BANK OF INDIA, NAWANSHAHAR (ACCOUNT NO.1552507424 BY CHE QUE NO.018868). THIS ENTRY APPEARS TO BE GENUINE. THIS ADDITION MAY BE DECIDED ON MERITS. (IV) INTEREST PAID TO BANKS THE INTEREST PAID TO THE BANKS IS AS PER BOOKS OF A CCOUNTS OF THE ASSESSEE. THIS FACT WAS VERIFIED. EVEN THE BANK ACC OUNT WHICH WAS FILED BY THE ASSESSEE, CONFIRMS THE PAYMENTS OF INT EREST. THE ADDITION MAY BE DECIDED ON MERITS. (V) PROFIT AND LOSS EXPNES. THE EXPENSES DEBITED TO PROFIT AND LOSS ACCOUNT ARE NOT AS PER THE BOOKS OF ACCOUNT WHICH WAS VERIFIED BY THE INSPECTO RS. THE EXPENSES ON ACCOUNT OF SALARY, POSTAGE, DIRECTORS FEES, FILI NG FEES, ELECTRICITY EXPENSES AND BANKS CHARGES, ETC. WHICH WERE BOOKED BY THE ASSESSEE DIFFER AS UNDER:- AS PER BOOKS AS PER BALANCE SHEET SALARY 28,3176/- 179126/- POSTAGE 5135/- 5535/- DIRECTOR FEE 36000/- NIL TANKERS EXPENSES 127666/- 127666/- ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 11 SINCE THERE IS A DIFFERENCE IN THE EXPENSES CLAIMED AND EXPENSES AS PER BOOKS ON VERIFICATION THE ADDITIONS MADE BY THE AO SHOULD BE SUSTAINED. IN RESPECT OF ALL THESE YEARS ASSESSING OFFICER HAD PREPARED COMMON REMAND REPORT WHICH IS PLACED AT PAPER BOOK PAGE 15 TO 35. WE FIND THAT IN RESPECT OF INTEREST PAID TO BANK THE ASSESSING O FFICER DURING THE REMAND PROCEEDINGS HAD VERIFIED THE FACT OF PAYMENT OF INTEREST, THEREFORE, AS REGARDS THE INTEREST PAID TO BANKS TH ERE CANNOT BE SAID TO BE ANY GRIEVANCE OF THE REVENUE AS ASSESSING OFFICE R HAD VERIFIED THE SAME. 15. AS REGARDS AD HOC DISALLOWANCES, THE ASSESSING OFFICER DURING THE REMAND PROCEEDINGS HAS VERIFIED THE EXPENSES AND HA S SUBMITTED IN THE REMAND REPORT THAT NO AD HOC DISALLOWANCE CAN BE MA DE. 16. HOWEVER, WITH RESPECT TO CERTAIN DIFFERENCE IN FIGURES AS PER P&L ACCOUNT AND AS PER BALANCE SHEETS HE HAD SUGGESTED FOR SUSTAINING SUCH ADDITIONS. 17. THE LEARNED CIT(A) AFTER CONSIDERING THE REMAND REPORT HAS ALLOWED RELIEF TO THE ASSESSEE. THE GROUND WISE OF RELEVANT FINDINGS OF LEARNED CIT(A) ARE REPRODUCED BELOW. ASST. YEAR: 2006-07 7. I HAVE CONSIDERED THE BASIS OF ADDITIONS MADE BY ASSESSING OFFICER AND THE REPORT OF THE ASSESSING OFFICER DURING APPE LLATE PROCEEDINGS AS WELL AS ARGUMENTS OF AR ON THE ISSUES. THE ASSESSIN G OFFICER HAD DISALLOWED AN AMOUNT OF RS.2,54,311/- BEING 40% OF VARIOUS EXPENSE DEBITED TO P&L ACCOUNT OTHER THAN DEPRECIATION AND INTEREST ON ACCOUNT OF WANT OF EVIDENCE. DURING THE COURSE OF REMAND PROCE EDINGS, ASSESSING OFFICER HAS VERIFIED THE EXPENSES DEBITED FROM THE BOOKS OF ACCOUNTS AND ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 12 POINTED OUT THE DIFFERENCES IN SALARY AS SPECIFIED IN THE REMAND REPORT. IT IS SEEN THAT THE SAME HAS BEEN EXPLAINED BY THE AR ON ACCOUNT OF RECOVERIES MADE FROM EMPLOYEE ON ACCOUNT OF EMBEZZLEMENT DONE BY HIM OVER NUMBER OF YEARS WHICH MEANS THAT SALARY DEBITED TO P&L ACCOUNT IS LESS IN COMPARISON TO THE SALARY AS RECORDED IN THE LEDG ER ACCOUNT OF CONCERNED EMPLOYEE. THE ACCOUNTING TREATMENT OBVIOUSLY DOES N OT MERIT ANY ADDITION AND THEREFORE, THE ADDITION MADE BY THE ASSESSING O FFICER TO THE TUNE OF RS.2,54,311/-. 9. THE GROUND OF APPEAL AT SR. NO.7 PERTAINS TO AN ADDITION OF RS.28,30,000/- WHICH HAD BEEN MADE BY THE ASSESSING OFFICER ON THE GROUND THAT ASSESSEE DID NOT EXPLAIN PAGE NO.5 & 9 OF ANNEXURE-3 SEIZED FROM THE RESIDENCE OF SH. PREM PAL GANDHI. DURING T HE COURSE OF APPELLATE PROCEEDINGS THE ISSUE HAD BEEN EXAMINED BY THE ASSE SSING OFFICER AND HIS COMMENTS WITH REFERENCE TO THIS ADDITION ARE AS FOL LOWS: SH. PREM PAL GANDHI IS PROPRIETOR OF K.C. PALACE, NAWANSHAHAR INCOME EARNED FROM K.C. PALACE HAS BEEN SHOWN BY SH RI PREM PAL GANDHI IN HIS RETURN OF INCOME. THE PAPERS SEIZED F ROM THE RESIDENCE OF SHRI PREM PAL GANDHI WERE SCRUTINIZED AND ADDITIONS WERE MADE IN HIS INCOME EARNED FROM K.C. PALACE NAW ANSHAHAR. SINCE SH. PREM PAL GANDHI IS A SEPARATE TAX ENTITY, THE ADDITION MADE ON THIS GROUND MAY BE CONSIDERED FOR DELETION. IN VIEW OF THE ABOVE, THE ADDITION MADE IS DIRECTED TO BE DELETED. ASST. YEAR: 2007-08 7. I HAVE CONSIDERED THE BASIS OF ADDITIONS MADE BY ASSESSING OFFICER AND THE REPORT OF THE ASSESSING OFFICER DURING APPE LLATE PROCEEDINGS AS WELL AS ARGUMENTS OF AR ON THE ISSUES. THE ASSESSIN G OFFICER HAD PROPOSED AN ADDITION OF RS.2,25,356/- BEING THE DIFFERENCE I N FIGURES OF SALES. THE SAID DIFFERENCE HAS BEEN EXPLAINED BY THE APPELLANT BY SUBMITTING THAT IT WAS ON ACCOUNT OF THE EXCLUSION OF VAT AND THE RELE VANT EVIDENCE HAS ALSO BEEN PRODUCED IN THE FORM OF LEDGER ACCOUNT. THE PE RUSAL OF SAME CLEARLY SHOWS THAT THE DIFFERENCE HAD ARISEN ONLY BECAUSE O F VAT RECOVERABLE AND PAYABLE WAS TO BE REDUCED FROM SALES. THEREFORE, TH E ADDITION MADE BY THE ASSESSING OFFICER TO THE TUNE OF RS.2,25,356/- IS DIRECTED TO BE DELETED AS THE FIGURE OF SALES CORRECTLY MATCHES WITH BOOKS OF ACCOUNTS MAINTAINED AND VERIFIED BY THE ASSESSING OFFICER. 8. THE ASSESSING OFFICER HAD MADE ADDITION OF RS.15 ,48,832/- UNDER SECTION 43B ON ACCOUNT OF INTEREST PAID TO BANKER A S NO PROOF OF PAYMENT HAD BEEN SUBMITTED. THE ASSESSING OFFICER DURING TH E COURSE OF REMAND PROCEEDINGS HAS VERIFIED THE INTEREST PAID TO THE B ANK WHICH AS PER THE BOOKS OF ACCOUNTS. AS SUCH, THE ADDITION MADE IS DI RECTED TO BE DELETED. ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 13 9. THE ASSESSING OFFICER HAD DISALLOWED AN AMOUNT O F RS.2,60,253/- BEING 40% OF VARIOUS EXPENSE DEBITED TO P&L ACCOUNT OTHER THAN DEPRECIATION AND INTEREST ON ACCOUNT OF WANT OF EVI DENCE. DURING THE COURSE OF REMAND PROCEEDINGS, ASSESSING OFFICER HAS VERIFIED THE EXPENSES DEBITED FROM THE BOOKS OF ACCOUNTS AND POINTED OUT THE DIFFERENCES IN SALARY AS SPECIFIED IN THE REMAND REPORT. IT IS SEE N THAT THE SAME HAS BEEN EXPLAINED BY THE AR ON ACCOUNT OF RECOVERIES MADE F ROM EMPLOYEE ON ACCOUNT OF EMBEZZLEMENT DONE BY HIM OVER NUMBER OF YEARS WHICH MEANS THAT SALARY DEBITED TO P&L ACCOUNT IS LESS IN COMPA RISON TO THE SALARY AS RECORDED IN THE LEDGER ACCOUNT OF CONCERNED EMPLOYE E. THE ACCOUNTING TREATMENT OBVIOUSLY DOES NOT MERIT ANY ADDITION AND THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFICER TO THE TUNE OF RS.2,60,253/- IS DIRECTED TO BE DELETED. 10. THE GROUND OF APPEAL AT SR. NO.8 PERTAINS TO AN ADDITION OF RS.37,00,000/- WHICH HAD BEEN MADE BY THE ASSESSING OFFICER ON THE GROUND THAT ASSESSEE DID NOT EXPLAIN PAGE NO.5 & 9 OF ANNEXURE-3 SEIZED FROM THE RESIDENCE OF SH. PREM PAL GANDHI. DURING T HE COURSE OF APPELLATE PROCEEDINGS THE ISSUE HAD BEEN EXPLAINED BY THE ASS ESSING OFFICER AND HIS COMMENTS WITH REFERENCE TO THIS ADDITION ARE AS FOL LOWS:- SH. PREM PAL GANDHI IS PROPRIETOR OF K.C. PALACE, NAWANSHAHAR INCOME EARNED FROM K.C.PALACE HAS BEEN SHOWN BY SHR I PREM PAL GANDHI IN HIS RETURN OF INCOME. THE PAPERS SEIZED FROM THE RESIDENCE OF SHRI PREM PAL GANDHI WERE SCRUTINIZED AND ADDITION AND ADDITI ONS WERE MADE IN HIS INCOME EARNED FROM K.C.PALACE NAWANSHAHAR. SINCE SH . PREM PAL GANDHI IS A SEPARATE TAX ENTITY, THE ADDITION MADE ON THIS GROUND MAY BE CONSIDERED FOR DELETION. IN VIEW OF THE ABOVE, THE ADITION MADE IS DIRECTED TO BE DELETED. ASST. YEAR: 2008-09 7. I HAVE CONSIDERED THE BASIS OF ADDITIONS MADE BY ASSESSING OFFICER AND THE REPORT OF THE ASSESSING OFFICER DURING APPE LLATE PROCEEDINGS AS WELL AS ARGUMENTS OF AR ON THE ISSUES. THE ASSESSIN G OFFICER HAD PROPOSED AN ADDITION OF RS.3,52,948/- BEING THE DIFFERENCE I N FIGURES OF SALES. THE SAID DIFFERENCE HAS BEEN EXPLAINED BY THE APPELLANT BY SUBMITTING THAT IT WAS ON ACCOUNT OF THE EXCLUSION OF VAT AND THE RELE VANT EVIDENCE HAS ALSO BEEN PRODUCED IN THE FORM OF LEDGER ACCOUNT. THE PE RUSAL OF SAME CLEARLY SHOWS THAT THE DIFFERENCE HAD ARISEN ONLY BECAUSE O F VAT RECOVERABLE AND PAYABLE WAS TO BE REDUCED FROM SALES. THEREFORE, TH E ADDITION MADE BY THE ASSESSING OFFICER TO THE TUNE OF RS.3,52,948/- IS DIRECTED TO BE DELETED, AS THE FIGURE OF SALES CORRECTLY MATCHES WITH BOOKS OF ACCOUNTS MAINTAINED AND VERIFIED BY THE ASSESSING OFFICER. 8. THE ASSESSING OFFICER HAD MADE ADDITION OF RS.15 ,76,534/- UNDER SECTION 43B ON ACCOUNT OF INTEREST PAID TO BANKER A S NO PROOF OF PAYMENT HAD BEEN SUBMITTED. THE ASSESSING OFFICER DURING TH E COURSE OF REMAND PROCEEDINGS HAS VERIFIED THE INTEREST PAID TO THE B ANK WHICH AS PER THE BOOKS OF ACCOUNTS. AS SUCH, THE ADDITION MADE IS DI RECTED TO BE DELETED. ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 14 9. THE ASSESSING OFFICER HAD DISALLOWED AN AMOUNT O F RS.2,35,068/- BEING 40% OF VARIOUS EXPENSE DEBITED TO P&L ACCOUNT OTHER THAN DEPRECIATION AND INTEREST ON ACCOUNT OF WANT OF EVI DENCE. DURING THE COURSE OF REMAND PROCEEDINGS, ASSESSING OFFICER HAS VERIFIED THE EXPENSES DEBITED FROM THE BOOKS OF ACCOUNTS AND POINTED OUT THE DIFFERENCES IN SALARY AS SPECIFIED IN THE REMAND REPORT. IT IS SEE N THAT THE SAME HAS BEEN EXPLAINED BY THE AR ON ACCOUNT OF RECOVERIES MADE F ROM EMPLOYEE ON ACCOUNT OF EMBEZZLEMENT DONE BY HIM OVER NUMBER OF YEARS WHICH MEANS THAT SALARY DEBITED TO P&L ACCOUNT IS LESS IN COMPA RISON TO THE SALARY AS RECORDED IN THE LEDGER ACCOUNT OF CONCERNED EMPLOYE E. THE ACCOUNTING TREATMENT OBVIOUSLY DOES NOT MERIT ANY ADDITION AND THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFICER TO THE TUNE OF RS.2,35,068/- IS DIRECTED TO BE DELETED. 10. THE GROUND OF APPEAL AT SR. NO.8 PERTAINS TO AN ADDITION OF RS.12,59,000/- WHICH HAD BEEN MADE BY THE ASSESSING OFFICER ON THE GROUND THAT ASSESSEE DID NOT EXPLAIN PAGE NO.5 & 9 OF ANNEXURE-3 SEIZED FROM THE RESIDENCE OF SH. PREM PAL GANDHI. DURING T HE COURSE OF APPELLATE PROCEEDINGS THE ISSUE HAD BEEN EXPLAINED BY THE ASS ESSING OFFICER AND HIS COMMENTS WITH REFERENCE TO THIS ADDITION ARE AS FOL LOWS:- SH. PREM PAL GANDHI IS PROPRIETOR OF K.C. PALACE, NAWANSHAHAR INCOME EARNED FROM K.C. PALACE HAS BEEN SHOWN BY SH RI PREM PAL GANDHI IN HIS RETURN OF INCOME. THE PAPERS SEIZED FROM THE RESIDENCE OF SHRI PREM PAL GANDHI WERE SCRUTINIZED AND ADDITION AND ADDITI ONS WERE MADE IN HIS INCOME EARNED FROM K.C.PALACE NAWANSHAHAR. SINCE SH . PREM PAL GANDHI IS A SEPARATE TAX ENTITY, THE ADDITION MADE ON THIS GROUND MAY BE CONSIDERED FOR DELETED. IN VIEW OF THE ABOVE, THE ADDITION MADE IS DIRECTED TO BE DELETED. ASST. YEAR: 2009-10 7. I HAVE CONSIDERED THE BASIS OF ADDITIONS MADE BY ASSESSING OFFICER AND THE REPORT OF THE ASSESSING OFFICER DURING APPE LLATE PROCEEDINGS AS WELL AS ARGUMENTS OF AR ON THE ISSUES. THE ASSESSIN G OFFICER HAD PROPOSED AN ADDITION OF RS.3,01,918/- BEING THE DIFFERENCE I N FIGURES OF SALES. THE SAID DIFFERENCE HAS BEEN EXPLAINED BY THE APPELLANT BY SUBMITTING THAT IT WAS ON ACCOUNT OF THE EXCLUSION OF VAT AND THE RELE VANT EVIDENCE HAS ALSO BEEN PRODUCED IN THE FORM OF LEDGER ACCOUNT. THE PE RUSAL OF SAME CLEARLY SHOWS THAT THE DIFFERENCE HAD ARISEN ONLY BECAUSE O F VAT RECOVERABLE AND PAYABLE WAS TO BE REDUCED FROM SALES. THEREFORE, TH E ADDITION MADE BY THE ASSESSING OFFICER TO THE TUNE OF RS.7,08,456/- IS DIRECTED TO BE DELETED, AS THE FIGURE OF SALES CORRECTLY MATCHES WITH BOOKS OF ACCOUNTS MAINTAINED AND VERIFIED BY THE ASSESSING OFFICER. THE ASSESSIN G OFFICER HAD MADE ADDITION OF RS.35,03,300/- ON ACCOUNT OF INCREASE I N UNSECURED LOANS DURING THE YEAR WHICH HAD BEEN RECEIVED BY THE APPE LLANT FROM SH. PREM LAL GANDHI A SHAREHOLDER OF COMPANY. THE SAID AMOUN T RECEIVED IN CHEQUE ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 15 HAS BEEN VERIFIED BY ASSESSING OFFICER THERE WAS A DIFFERENCE OF 2,53,300/-. THIS DIFFERENCE HAS ALSO BEEN EXPLAINED BY THE APPELLANT AND THE PERUSAL OF THE ACCOUNT OF SH. PREM PAL GANDHI S HOWS THAT AN AMOUNT OF RS.4 LAKH HAS BEEN RETURNED TO HIM ON 08.04.2008 BY CHEQUE WHEREAS THE AMOUNT OF RS.2,69,250/- AND RS.3,85,050/- WERE RECEIVED OF REGISTRATION. THEREFORE, IT BECOMES APPARENT THAT T HERE IS NO DISCREPANCY EVEN ON THIS ACCOUNT. THE ADDITION MADE THEREFORE, IS DIRECTED TO BE DELETED. 8. THE ASSESSING OFFICER HAD FURTHER MADE ADDITION OF RS.50,00,000/- ON ACCOUNT OF AN ADVANCE OF RS.50,00,000/- TAKEN BY THE ASSESSEE AS ADVANCE FOR LAND. THE SAID ADVANCE HAD BEEN RECEIVE D FROM M/S K.C. SOCIAL WELFARE TRUST, NAWANSHAHAR AND THE SAID PAYM ENT HAS BEEN VERIFIED BY ASSESSING OFFICER DURING THE REMAND PRO CEEDINGS. AS SUCH, THE ADDITION MADE IS DIRECTED TO BE DELETE. 9. THE ASSESSING OFFICER HAD MADE ADDITION OF RS.15 ,65,853/- UNDER SECTION 43B ON ACCOUNT OF INTEREST PAID TO BANKER A S NO PROOF OF PAYMENT HAD BEEN SUBMITTED. THE ASSESSING OFFICER DURING TH E COURSE OF REMAND PROCEEDINGS HAS VERIFIED THE INTEREST PAID TO THE B ANKS WHICH IS AS PER THE BOOKS OF ACCOUNTS. AS SUCH, THE ADDITION MADE IS DI RECTED TO BE DELETED. 10. THE ASSESSING OFFICER HAD DISALLOWED AN AMOUNT OF RS.2,41,796/- BEING 40% OF VARIOUS EXPENSE DEBITED TO P&L ACCOUNT OTHER THAN DEPRECIATION AND INTEREST ON ACCOUNT OF WANT OF EVI DENCE. DURING THE COURSE OF REMAND PROCEEDINGS, ASSESSING OFFICER HAS VERIFIED THE EXPENSES DEBITED FROM THE BOOKS OF ACCOUNTS AND POINTED OUT THE DIFFERENCE IN SALARY AS SPECIFIED IN THE REMAND REPORT. IT IS SEEN THAT THE SAME HAS BEEN EXPLAINED BY THE AR ON ACCOUNT OF RECOVERIES MADE F ROM EMPLOYEE ON ACCOUNT OF EMBEZZLEMENT DONE BY HIM OVER NUMBER OF YEARS WHICH MEANS THAT SALARY DEBITED TO P&L ACCOUNT IS LESS IN COMPA RISON TO THE SALARY AS RECORDED IN THE LEDGER ACCOUNT OF CONCERNED EMPLOYE E. THE ACCOUNTING TREATMENT OBVIOUSLY DOES NOT MERIT ANY ADDITION AND THEREFORE THE ADDITION MADE BY THE ASSESSING OFFICER TO THE TUNE OF RS.2,4 1,796/- IS DIRECTED TO BE DELETED. FROM THE FINDINGS OF LEARNED CIT(A) AS WELL AS FROM THE REMAND REPORT OF ASSESSING OFFICER, WE FIND THAT LEARNED CIT(A) HAS RIGHTLY ALLOWED RELIEF TO THE ASSESSEE AFTER THE ASSESSING OFFICER WAS SATISF IED WITH RESPECT TO THE EXPLANATION FOR ADDITIONS. 18. AS REGARDS THE OBJECTIONS OF ASSESSING OFFICER WITH RESPECT TO CERTAIN DISCREPANCIES IN THE BOOKS OF ACCOUNTS AND AS PER BALANCE SHEET ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 16 THE ASSESSEE VIDE REJOINDER TO REPORT PLACED AT PAG E 20 TO 23 HAD EXPLAINED THE SAME WHICH THE LEARNED CIT(A) ACCEPTE D AND WHICH IN OUR OPINION ALSO HAS BEEN PROPERLY EXPLAINED BY ASSESSE E. THE EXPLANATIONS OF ASSESSEE ON DIFFERENCES DURING REMAND PROCEEDING S ARE REPRODUCED BELOW. ASST. YEAR: 2006-07 TRADING ACCOUNT ADDITION. THESE COMMENTS OF THE ASSESSING OFFICER MAY BE READ IN CONJUNCTION WITH HIS COMMENTS ON THI S ISSUE AT PAGE 10. THE LEARNED ASSESSING OFFICER HAS CORRECTLY POINTED OUT THAT THERE IS DIFFERENCE OF RS. 56,213/- IN THE SALES SHOWN IN TH E PROFIT AND LOSS A/C AND SALES SHOWN IN THE BOOKS OF ACCOUNTS. THIS FACT WAS NOT POINTED WHILE VERIFYING THE BOOKS OF ACCOUNTS. THE VARIATIO N IN SALES IS BECAUSE SALES TAX /VAT ON DIESELS OF RS.46825.07 AND ON PET ROL OF RS.9387.40 I.E. RS.56212.47 WAS TO BE DEBITED TO SALES ACCOUNT AND CREDITED TO SALES TAX ACCOUNT. PHOTO COPIES OF LEDGER FOLIO OF THE RELEVA NT PAGES ARE SUBMITTED. THE ADDITION MAY KINDLY BE DELETED. ASST. YEAR: 2008-09 TRADING ACCOUNT ADDITION THESE COMMENTS OF THE ASSESSING OFFICER MAY BE READ IN CONJUNCTION WITH HIS COMMENTS ON THIS IS SUE AT PAGE 10. THE LEARNED ASSESSING OFFICER HAS CORRECTLY POINTED OUT THAT THERE IS DIFFERENCE OF RS.2,26,967/- IN THE SALES SHOWN IN T HE PROFIT AND LOSS A/C AND SALES SHOWN IN THE BOOKS OF ACCOUNTS. THIS FACT WAS NOT POINTED WHILE VERIFYING THE BOOKS OF ACCOUNTS. THE VARIATIO N IN SALES IS BECAUSE VAT RECOVERABLE OF RS.54,439/- AND PAYABLE 1,72,52 8/- WAS TO BE REDUCED FROM THE SALES. PHOTO COPIES OF LEDGER FOLI O OF THE RELEVANT PAGE ARE SUBMITTED. THE ADDITION MAY KINDLY BE DELETED. ASST. YEAR: 2009-10 (I) TRADING ACCOUNT ADDITION. THESE COMMENTS OF THE ASSESSING OFFICER MAY BE READ IN CONJUNCTION WITH HIS COMMENTS ON THI S TOPIC AT PAGE NO.10. THE LEARNED ASSESSING OFFICER HAS CORRECTLY POINTED OUT THAT THERE IS DIFFERENCE OF RS.3,01,918/- IN THE SALES SHOWN I N THE PROFIT AND LOSS A/C. THIS DIFFERENCE IS BECAUSE OF BIFURCATION OF S ALES AND VAT. THE RELEVANT LEDGER FOLIO ARE ENCLOSED. (II) SUNDRY CREDITORS ADDITIONS A PHOTO COPY OF LEDGER A/C OF SH. PREM PAL GANDHI FOR THE RELEVANT PREVIOUS YEAR IS ENCLOS ED FOR YOUR HONOURS PERUSALS. SH. PREM PAL GANDHI ADVANCED A SUM OF RS. 32,50,000/- BY CHEQUE ON 07.04.2008. A SUM OF RS.4,00,000/- WAS RE TURNED BY CHEQUE TO HIM ON 08.04.2008. THE BALANCE REMAINED AT RS.28 ,50,000/-. HE HAD ALSO ADVANCED A SUM OF RS.2,69,250/- AND RS.3,85,05 0/- ON 08.04.2008, THE AMOUNT WAS PAID BY CHEQUES FOR EXPENSES OF REGI STRATION. THE ITA NOS.9 5 TO 98 (ASR)/2013 C.O NOS.13 TO 16 (ASR)/2013 ASST. YEARS: 2006-07 TO 2009-10 17 NET/TOTAL ADVANCE INCREASED TO RS.35,03,000/-. THE CONFIRMATION FROM SH. PREM GANDHI WAS FILED. IT IS REQUESTED THAT EVE N ADDITION OF RS.253,300/- MAY NOT BE MADE. ASST. YEAR: 2010-11 TRADING ACCOUNT ADDITION. THESE COMMENTS OF THE ASSESSING OFFICER MAY BE READ IN CONJUNCTION WITH HIS COMMENTS ON THI S TOPIC AT PAGE NO.10. THE LEARNED ASSESSING OFFICER HAS WRONGLY PO INTED OUT THAT THERE IS DIFFERENCE IN PURCHASE AND IN THE SALES SHOWN IN THE PROFIT AND LOSS A/C. THE FIGURES IS UPTO THE DATE OF SEARCH AND SEI ZURE. THE RELEVANT LEDGER FOLIO ARE ENCLOSED. 19. THE LEARNED CIT(A)S ORDER IS BASED UPON THE VE RIFICATION OF FACTS AND FIGURES BY ASSESSING OFFICER, FOR WHICH WE DO N OT FIND ANY INFIRMITY IN THE ORDER OF LEARNED CIT(A), THEREFORE, THE APPEALS FILED BY REVENUE ARE DISMISSED. 20. IN NUTSHELL, THE APPEALS FILED BY REVENUE AS WE LL AS THE CROSS OBJECTIONS FILED BY ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH JUNE, 2016. SD/- SD/- (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:29.06.2016. /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER