NARENDRA KUMAR CHATURVEDI, Jaipur V. ITO, Sawai Madhopur

ITA 1015/JPR/2010

• Counselvise Citation: 101523114 RSA 2010
• Duration Of Justice: 1 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 10-08-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VINOD JOHRI
• Assessee Lawyers: S L PODDAR
• Keywords: Depreciation; Additional evidence; Onus to prove
• Section: 131

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH A JAIPUR (BEFORE SHRI R.K.GUPTA AND SHRI N.L.KALRA) ITA NO.1015/ JP/2010 ASSESSMENT YEAR 2005-06 PAN: ABSPC 5327 P SHRI NARENDRA KUMAR CHATURVEDII VS THE ITO PROP M/S. VISHNU MOTORS WARD 3 HINDAUN CITY SWAI MADHOPUR (APPELLANT ) (RESPONDENT) ASSESSEE BY: SHRI S.L. PODDAR DEPARTMENT BY : SHRI VINOD JOHRI ORDER PER N.L. KALRA, AM:- THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A), AJMER DATED 26-03-2010 FOR THE ASSESSMENT YEAR 200 5-06. 2.0 THE ASSESSEE HAS MADE A REQUEST FOR CONDONATION OF DELAY. IN THE AFFIDAVIT, THE ASSESSEE HAS STATED THAT HIS COUNSEL WAS OUT OF INDIA AND RETURNED ON 9 TH AUG. 2010. THE APPEAL HAS BEEN DELAYED BY THREE DA YS. AFTER CONSIDERING THE REASONS GIVEN IN THE APPLICATION, W E FEEL THAT DELAY OF THREE DAYS IS TO BE CONDONED. ACCORDINGLY THE DELAY IS CO NDONED. 2 3.0 DURING THE COURSE OF HEARING, THE LD. AR OF THE ASSESSEE HAS NOT PRESSED THE GROUND OF APPEAL NO. 1 IN RESPECT OF REJECTION OF BOOKS OF ACCOUNT. THEREFORE, THE SAME IS DISMISSED AS BEING NOT PRESSED. 4.1 THE SECOND GROUND OF APPEAL OF THE ASSESSEE IS THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE TRADING ADDITION OF RS. 12, 29,950/ OUT OF RS. 16,33,656/- MADE BY THE AO. 4.2 THE ASSESSEE IS DEALING IN SALES OF TRACTOR AND TRACTOR PARTS. THE AO IN HIS ORDER HAS MENTIONED THE FOLLOWING FACTS 1. THE ASSESSEE HAS NOT PRODUCED ANY BILL IN RESPEC T OF PURCHASE OF TRACTOR, TRACTOR PARTS ETC. THE ASSESSE E IS NOT MAINTAINING THE STOCK REGISTER. 2. THE ASSESSEE DID NOT FILE ITEMWISE DETAILS OF CL OSING STOCK. 3. THE ASSESSEE DID NOT PRODUCE PURCHASE AND SALES BILLS FOR THE MONTH OF FEB. AND MARCH 4. THE ASSESSEE WAS ASKED TO FILE THE STATEMENT OF ACCOUNT OF THE ASSESSEE IN THE BOOK OF INDO PHARMA TRACTORS & MOTORS LTD., THE CONCERN FROM WHICH THE ASSESSEE WAS PURC HASING THE TRACTORS AND TRACTOR PARTS. 5. THE ASSESSEE HAS SHOWN THE CREDIT BALANCE IN THE NAME OF M/S. VIJAY MOTORS TO THE EXTENT OF RS. 2,53,236/- . ON ENQUIRY 3 FROM M/S. VIJAY MOTORS, IT WAS FOUND THAT NO AMOUNT IS RECEIVABLE BY THAT CONCERN FROM THE ASSESSEE. THIS FACT WAS INTIMATED TO THE ASSESSEE BUT THE ASSESSEE DID NOT GIVE ANY EXPLANATION. 6. THE AO OBTAINED THE COPY OF THE CURRENT ACCOUNT OF THE ASSESSEE MAINTAINED IN THE ORIENTAL BANK OF COMMERC E AND THE ASSESSEE WAS ALSO ASKED TO GIVE THE STATEMENT OF ST OCK GIVEN TO THE BANK. HOWEVER, NO DETAILS OF STOCK STATEMENT WE RE GIVEN. THE AO OBTAINED THE DETAILS FROM THE BANK AND SUCH DETAILS HAVE BEEN MENTIONED AT PAGES 5 AND 6 OF THE ASSESSM ENT ORDER. AS PER STATEMENT GIVEN TO THE BANK, THE CLOSING STO CK AT THE END OF THE YEAR WAS SHOWN AT RS. 15.60 LACS. AS AGAINST STOCK OF RS. 15.60 LACS SHOWN TO THE BANK, THE ASSESSEE HAS SHOW N CLOSING STOCK IN THE BOOKS AT RS. 3,30,500/- 4.3 BEFORE THE AO, IT WAS STATED THAT THE STOCK ON ESTIMATE BASIS WAS BEING SHOWN TO THE BANK. IN RESPECT OF DISCREPANCIES IN T HE STOCK, THE AO RELIED UPON THE FOLLOWING DECISIONSS FOR TAKING THE DIFFER ENCE OF STOCK AS PER BANK STATEMENT AND AS PER BOOKS AS INCOME OF THE ASSESSE E 1. M/S. RACON MACHINE TOOLS (P) LTD. VS CIT 288 ITR 637 8 (KARNATAKA) 2. M/S. KAILA SWEET SUPPLIERS VS CIT, 163 CTR 302 (ALL.) 3. M/S. COIMBATORE SPINNING AND WEAVING CO. LTD., 95 ITR 375 (MAD.) 4 4.4 THE AO MADE THE TRADING ADDITION AFTER ESTIMATI NG THE SALES AT RS. 1.25 CRORES AND APPLIED THE G.P.RATE OF 20%. NO SEP ARATE ADDITION FOR DIFFERENCE IN STOCK WAS ADDED AND IT WAS CONSIDERED TO BE COVERED BY THE TRADING ADDITION OF RS. 16,33,656/-. 4.5 THE LD. CIT(A) IN PARA 4.2 OF HIS ORDER HAS MEN TIONED THAT THE AO HAS GIVEN NINE OPPORTUNITIES ON DIFFERENT DATES. BEFORE THE LD. CIT(A), IT WAS STATED THAT THE NON-VERIFICATION OF ENTRIES IN THE NAME OF M/S. VIJAY MOTORS IS NOT RELEVANT FOR MAKING THE TRADING ADDITION. IT WA S FURTHER SUBMITTED THAT INFORMATION FROM BANK WAS OBTAINED BEHIND THE BACK OF THE ASSESSEE. THE AO HAS NOT POINTED OUT ANY PURCHASE OR SALES OUTSID E THE BOOKS OF ACCOUNT. IF NO PHYSICAL VERIFICATION WAS MADE BY THE BANK TH EN THE ADDITION COULD NOT HAVE BEEN MADE. THE LD. CIT(A) AFTER CONSIDERING TH E ARGUMENTS CONFIRMED THE TRADING ADDITION TO THE EXTENT OF RS. 12,29,95 0- AFTER OBSERVING AS UDER:- 5.4 ARGUMENT OF THE APPELLANT HAS BEEN CONSIDERED BUT THE SAME IS NOT ACCEPTABLE. AS PER BOOKS OF ACCOUNTS OF THE APPELLANT, THE CLOSING STOCK AS ON 31.03.2005 IS OF RS.3,30,50 0/-. WHILE IN THE STATEMENT GIVEN TO THE BANK TOTAL STOCK OF RS.15,60 ,000/- IS SHOWN. THUS THERE IS DIFFERENCE OF RS.12,29,500/-. NO SATI SFACTORY EXPLANATION IS GIVEN REGARDING THIS DIFFERENCE EITH ER BEFORE AO OR THE UNDERSIGNED. THE ARGUMENT OF THE APPELLANT THAT STOCK STATEMENT IS GIVEN TO THE BANK OF ESTIMATE BASIS IS ALSO NOT ACCEPTABLE BECAUSE THE DIFFERENCE IN THIS CASE IS V ERY LARGE. THE STOCK SHOWN TO BANK IS NEARLY 5 TIMES THE STOCK SHO WN BY APPELLANT IN HIS BOOKS. MOREOVER IF NATIONALIZED BANKS ARE IN DULGING IN SUCH 5 IRREGULARITIES, THEN IT IS A MATTER OF SERIOUS CONC ERN. AFTER ALL, BANK AUTHORITIES ARE DEALING WITH PUBLIC MONEY. PEOPLE K EEP THEIR HARD EARNED MONEY IN NATIONALIZED BANKS ON MEAGER RATE O F INTEREST ONLY FOR SAFETY OF THEIR PRINCIPAL AMOUNT. BANK AUTHORIT IES HAVE NO RIGHT TO ADVANCE IT TO RICH AND INFLUENTIAL PERSONS ONLY ON THE BASIS OF FORGED/FABRICATED/INCORRECT DOCUMENTS. IT IS HIGH T IME, BANKS FIX ACCOUNTABILITY OF THEIR EMPLOYEES IN THIS REGARD. M OREOVER IN HIS BOOKS THE APPELLANT HAS SHOWN ONLY STOCK OF TRACTOR PARTS OF RS.3,30,500/-. AO HAS THEREFORE RIGHTLY CONCLUDED T HAT BOOKS OF ACCOUNTS ARE NOT RELIABLE. HE IS ALSO JUSTIFIED IN ESTIMATING INCOME BY INVOKING THE PROVISIONS OF SECTION 145. THIS ACT ION OF AO IS CONFIRMED. 5.5 HOWEVER SO FAR AS THE ESTIMATION OF INCOME IS C ONCERNED, ESTIMATION OF AO IS ON THE HIGHER SIDE. THE DISCREP ANCY POINTED OUT BY AO IS IN RESPECT OF STOCK OF RS.12,29,950/-. THUS IT IS REASONABLE TO RESTRICT THE TRADING ADDITION ALSO TO THIS AMOUNT. IN THE ABSENCE OF ANY EVIDENCE BROUGHT ON RECORD BY AO REGARDING SUPPRESSION OF SALES BY APPELLANT, THE ENHANCEMENT OF SALES TO RS.1,25,00,000/- INSTEAD OF RS.69,98,276/- AS DECLA RED BY APPELLANT IS NOT JUSTIFIED. THERE IS ALSO NO JUSTIFICATION FO R APPLYING G.P. RATE OF 20% AS AGAINST 12.37% DECLARED BY APPELLANT. AO IS THEREFORE DIRECTED TO RESTRICT TRADING ADDITION TO RS.12,29,9 50/- AS AGAINST RS.16,33,656/- MADE BY HIM. GROUND NO.2 IS THUS PAR TLY ALLOWED. BEFORE US, THE LD. AR TRIED TO EXPLAIN THE REASONS FOR DISCREPANCY IN THE STOCK DECLARED TO BANK AND STOCK AS PER BILLS. THE ASSESSEE GAVE THE INFLATED STATEMENT OF STOCK TO THE BANK FOR OBTAINI NG HIGHER OVER DRAFT. FOR THIS PURPOSE, RELIANCE WAS PLACED ON THE DECISION O F HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT VS RAMKRISHAN MILLS,93 ITR 49. THE LD. AR ALSO RELIED UPON THE FOLLOWING DECISIONS. 6 1. CIT VS LAXMI ENGG INDUSTRIES, 308 ITR 279 (RAJ.) 2. KISHINCHAND CHELLARAM VS CIT 125 ITR 713 (SC) 4.6 THE LD. AR FURTHER SUBMITTED THAT THE AO HAS ES TIMATED THE SALES WITHOUT COLLECTING ANY MATERIAL IN RESPECT OF SALES OUTSIDE THE BOOKS OF ACCOUNT 4.7 ON THE OTHER HAND, THE LD. DR REFERRED TO THE O RDER OF THE AO. THE AO PROVIDED ADEQUATE OPPORTUNITIES TO THE ASSESSEE TO PRODUCE THE RELEVANT DETAILS. THE ASSESSEE HAS FAILED TO PRODUCE THE REL EVANT DETAILS. THE ASSESSEE HAS NOT BEEN ABLE TO OFFER ANY EXPLANATION IN RESPE CT OF DISCREPANCIES IN THE STOCK A MERE ARGUMENT IS NOT SUFFICIENT TO SAY THAT THE STOCK WAS INFLATED. 4.8 WE HAVE HEARD BOTH THE PARTIES. THE ASSESSEE HA S NOT PRESSED THE GROUND IN RESPECT OF REJECTION OF BOOKS OF ACCOUNT AND APPLICATION OF PROVISIONS OF SECTION 145(3) OF THE ACT. ONCE RELEV ANT BOOKS OF ACCOUNT ALONGWITH PURCHASES AND SALES VOUCHERS ARE NOT PROD UCED THEN THE AO IS LEFT WITH NO ALTERNATIVE BUT TO ESTIMATE THE SALES AND T HE GROSS PROFIT. THE AO HAS NOTICED OTHER DISCREPANCIES IN THE BOOKS OF ACCOUNT . UNDER SUCH CIRMUSTANCS, THE AO HAS TO MAKE THE BEST JUDGEMENT ASSESSMENT. T HE HON'BLE SUPREME COURT IN THE CASE OF KISHNICHAND CHELLARAM VS CIT, (SUPRA) HAS HELD THAT IN CASE THE LETTER FROM THE MANAGER WAS NOT SHOWN TO T HE ASSESSEE THEN THE 7 LETTER IS NOT ADMISSIBLE. IN THIS CASE, THERE WAS A TELEGRAPHIC TRANSFER OF AMOUNT BY THE EMPLOYEE OF ONE OFFICE TO THE EMPLOYE E OF ANOTHER OFFICE. HON'BLE APEX COURT OBSERVED THAT IT IS QUITE POSSIB LE THAT ONE OF THE EMPLOYEE COULD HAVE INTIMATED THE AMOUNT TO ANOTHER EMPLOYEE FROM HIS OWN RESOURCES. IT WAS FOR THE REVENUE TO RULE OUT S UCH POSSIBILITY. THIS CASE IS NOT APPLICABLE BECAUSE THE STOCK STATEMENTS HAVE BEEN SIGNED BY THE EMPLOYEE AND GIVEN TO THE BANK. THE STOCK STATEMENT WAS GIVEN EVERY MONTH. ON QUERY FROM THE BENCH, THE ASSESSEE HAS NO T BEEN ABLE TO SHOW THE STOCK STATEMENT OF OTHER MONTHS TO ASCERTAIN AS TO WHETHER THE STOCK WAS COMING FROM EARLIER MONTHS OR PRIOR TO ACCOUNTING Y EAR. THE ASSESSEE HAS SHOWN THREE TRACTORS AND THE AO HAS REPEATEDLY ASKE D THE ASSESSEE TO FILE THE COPY OF STOCK STATEMENT IN THE BOOKS OF ACCOUNT OF THE COMPANY FROM WHICH THE ASSESSEE WAS EFFECTING THE PURCHASES. IT IS NOT THE CASE OF THE ASSESSEE THAT HE MADE A REQUEST TO THE AO TO OBTAIN SUCH INF ORMATION U/S 131 OF THE ACT. 4.9 THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CA SE OF CIT VS LAXMI ENGG. INDUSTRIES (SUPRA) HAD AN OCCASION TO CONSIDE R AS TO WHETHER THE ADDITION CAN BE MADE ON ACCOUNT OF DIFFERENCE BETWE EN THE VALUATION SHOWN IN THE ACCOUNT AND THE VALUATION DISCLOSED TO THE B ANK. IN THAT CASE, THERE WAS NO DIFFERENCE IN THE QUANTITY OF STOCK. 8 4.10 THE LD. AR DURING THE COURSE OF HEARING WAS AS KED TO GIVE AS TO WHETHER THE VERIFICATION OF QUANTITY AS SHOWN IN TH E STOCK STATEMENT OF THE BANK AND STOCK AS PER BOOKS OF ACCOUNT CAN BE CORRE LATED. THE LD. AR HAS SHOWED HIS INABILITY. THE LD. AR HAS HEAVILY RELIED UPON THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CI T VS RELAXO FOOTWAR, 259 ITR 744 . IN THAT CASE THE ASSESSEE WAS ABLE TO EXPLAIN THE D ISCREPANCIES NOTICED FROM THE DETAILS COLLECTED FROM THE BUYERS AND SELLERS. THE TRIBUNAL AFTER CONSIDERING SUCH FACTUAL POSITION HELD THAT T HE STOCK STATEMENT SUBMITTED TO THE BANK WAS A MOTIVATED ONE AND DELET ED THE ADDITION. THE HON'BLE HIGH COURT HELD THAT SUCH FINDING OF THE TR IBUNAL IS A FINDING OF FACT. THE ASSESSEE HAS FILED THE PAPER BOOK CONTAIN ING 100 PAGES BUT IT DOES NOT CONTAIN THE TRADING ACCOUNT. FROM PURCHASES AND SALES OF TRACTORS, THE ASSESSEE COULD HAVE EASILY GIVEN THE PROOF OF TRACT ORS PURCHASED AND SOLD SO THAT ONE COULD HAVE EASILY COME TO THE CONCLUSION T HAT THE TRACTORS SHOWN IN THE BANK STATEMENTS WERE CORRECT OR NOT. THE ONUS W AS ON THE ASSESSEE TO ESTABLISH THAT THE STOCK STATEMENT GIVEN TO THE BAN K WAS MOTIVATED ONE IN ORDER TO HAVE A HIGHER LIMIT. THE ASSESSEE HAS FAIL ED TO DISCHARGE THE ONUS. IT IS TRUE THAT IN RESPECT OF TRACTORS SPARE PARTS AND MARUTI SPARE PARTS, THE ASSESSEE HAS GIVEN ONLY THE AMOUNT AND NOT THE QUAN TITY. IN RESPECT OF TRACTORS SPARE PARTS AND MARUTI SPARE PARTS, ONE CA N THINK OF GIVING OF 9 INFLATED VALUATION. HOWEVER, SUCH INFLATED MATERIAL S CAN BE CONSIDERED AS A REASONABLE LIMIT. THE VALUE OF THE STOCK SHOWN TO T HE BANK IS AS UNDER:- THREE TRACTORS 9.90 LACS TRACTOR SPARE PARTS 4.50 LACS MARUTI SPARE PARTS 420 LACS TOTAL 16.60 LACS THE STOCK AS PER BOOKS OF ACCOUNT IS 3.35 LACS. THE ASSESSEE HAS NEITHER PRODUCED THE BOOKS OF ACCOUNT NOR HAS GIVEN THE COP Y OF STATEMENT IN THE BOOKS OF M/S. INDO PHARMA TRACTORS & MOTORS LTD. TH US THE ASSESSEE HAS NOT BEEN ABLE TO ADDUCE ANY EVIDENCE TO SHOW THAT T HREE TRACTORS AND SPARE PARTS OF THREE TRACTORS WERE NOT AVAILABLE AT THE E ND OF THE YEAR. THUS THE STOCK OF TRACTORS IS UNEXPLAINED AS ON 31-03-05. IF THE REASONABLE PERCENTAGE IS GIVEN FOR THE OVERVALUATION OF TRACTOR SPARE PAR TS AND MARUTI SPARE PARTS THEN THE EXCESS STOCK OF TRACTOR SPARE PARTS AND MA RUTI SPARE PARTS IS ESTIMATED AT RS. 3.00 LACS. THUS THE EXCESS STOCK W ILL BE RS. 12.90 LACS AND THE LD. CIT(A) HAS CONFIRMED THE ADDITION TO THE EX TENT OF RS. 12,29,950/-. NO SEPARATE ADDITION FOR EXCESS STOCK IS MADE. THE ESTIMATION OF SALES MADE BY THE AO CANNOT TERMED AS INVALID. WE THEREFORE, U PHOLD THE ADDITION CONFIRMED BY THE LD. CIT(A) ON THIS ISSUE OF TRADIN G ADDITION. 10 5.1 THE THIRD GROUND OF THE ASSESSEE IS THAT THE LD . CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 6,40,000/- ON ACCOUN T OF CREDIT APPEARING IN THE ACCOUNT OF SHRI RAM KHILARI SHARMA 5.2 THE AO HAS REPRODUCED THE LEDGER ACCOUNT OF SHR I RAM KHILARI SHARMA AT PAGE 9 OF THE ASSESSMENT ORDER. DURING TH E YEAR, THE ASSESSEE HAS PAID RS. 6,40,500/- TO SHRI RAM KHILARI SHARMA THRO UGH ACCOUNT PAYEE CHEQUE. A SUM OF RS. 6,40,500/- HAS BEEN CREDITED I N HIS ACCOUNT IN CASH. THE CREDIT OF RS. 5.00 LACS IN CASH IS AFTER ISSUIN G OF CHEQUE AND SIMILARLY CASH OF RS. 140,500/- IS ALSO DEPOSITED AFTER ISSUI NG THE CHEQUE. THE AO RECORDED THE STATEMENT OF SHRI RAM KHILARI SHARMA O N 26-02-2007. SHRI RAM KHILARI SHARMA IN HIS STATEMENT HAS STATED THAT HE MADE THE PAYMENT THROUGH CHEQUE TO THE ASSESSEE ON DIFFERENT DATES D URING THE FINANCIAL YEAR 2002-03 AND 2003-04 AND THE TOTAL OF THESE AMOUNT W AS RS. 5.00 LACS. HE ALSO TOOK LOAN OF RS. 1,40,500/- FROM THE ASSESSEE ON 11-10-04 . HE ALSO ADMITTED THAT THE AMOUNT OF RS. 5.00 LACS WAS RECEI VED BACK BY HIM IN THE FINANCIAL YEAR 2004-05. HE TOOK LOAN OF RS. 1.40 LA CS IN HE FINANCIAL YEAR 2004-05. HE STATED THAT HE HAS NOT REPAID THE SUM O F RS. 1.40 LACS TO THE ASSESSEE. THE STATEMENT HAS BEEN RECORDED ON 26-02- 07 AND TILL THAT DATE THE SUM OF RS. 1,40,500/- HAS NOT BEEN GIVEN. SHRI RAM KHILARI SHARMA WAS INTIMATED THAT THE ASSESSEE HAS SHOWN THE PAYMENT TO HIM TO THE EXTENT OF 11 RS. 5.00 LACS AND RS. 1,40,500/- IN THE FINANCIAL Y EAR 2004-05 AND HAS ALSO CREDITED HIS ACCOUNT IN CASH I.E. RS. 6,40,500/-. S HRI RAM KHILARI SHARMA IN ANSWER TO QUESTION NO. 15 STATED THAT SHRI NARENDER A KUMAR CHATURVEDI, THE ASSESSEE, HAS GIVEN THE ADVANCE THAT HE HAS DEPOSIT ED THE AMOUNT IN CASH WITH HIM. AFTER RECORDING THE STATEMENT OF SHRI RAM KHILARI SHARMA, THE AO OBTAINED THE BANK STATEMENT OF THE ASSESSEE FROM OR IENTAL BANK OF COMMERCE. FROM THE BANK STATEMENT, THE AO NOTICED T HAT WITHDRAWALS FROM THE BANK HAVE BEEN UTILIZED FOR THE PURPOSE OF BUSI NESS. DURING THE ASSESSMENT, THE ASSESSEE WAS REQUIRED TO PRODUCE TH E BILLS IN RESPECT OF THE PURCHASES AND WAS ALSO REQUIRED TO PRODUCE THE BOOK S OF ACCOUNT BUT NO DETAILS WERE FILED. THE ASSESSEE WAS INTIMATED THE STATEMENT OF SHRI RAM KHILARI SHARMA. THE ASSESSEE STATED THAT THE SUM RE CEIVED FROM SHRI RAM KHILARI SHARMA WAS GIVEN TO SHRI ASHOK KUMAR SHARMA FOR PURCHASE OF THE LAND. SINCE THE TRANSACTION DID NOT MATERIALIZE, SU BSEQUENTLY THE AMOUNT WAS RECEIVED BACK. HENCE THE AMOUNT WAS CREDITED IN THE ACCOUNT OF SHRI RAM KHILARI SHARMA IN CASH. ACCORDING TO THE AO, THE ST ORY MADE BY THE ASSESSEE IS FICTITIOUS. IN SPITE OF SPECIFIC REQUIREMENT OF PRODUCING THE BOOKS OF ACCOUNT AND VOUCHERS FOR THE FINANCIAL YEAR 2003-04 BY THE AO, THE ASSESSEE HAS NOT PRODUCED SUCH BOOKS OF ACCOUNT. THE AMOUNT OF RS. 5.00 LACS WAS RECEIVED THROUGH CHEQUE AND WAS DEFINITELY CREDITED IN THE BANK ACCOUNT IN 12 CASE THE AMOUNT WAS CREDITED IN THE BANK ACCOUNT TH EN THERE SHOULD HAVE BEEN WITHDRAWAL IN CASH FOR MAKING THE ADVANCE FOR THE PURCHASE OF LAND. THE AO ACCORDINGLY WAS NOT SATISFIED WITH THE EXPLA NATION GIVEN BY THE ASSESSEE. THE AO FURTHER NOTICED THAT AGREEMENT FOR PURCHASE OF LAND IS ON THE NORMAL PAPER AND NOT ON THE STAMP PAPER. THE DE ED WRITER IS ALSO NOT HAVING ANY RECORD FOR SUCH TRANSACTION. THERE ARE N O SIGNATURES ON THIS AGREEMENT BY THE PURCHASER. THE AO ALSO RECORDED TH E STATEMENT OF SHRI ASHOK KUMAR SHARMA. HIS STATEMENT IS AVAILABLE AT P AGE 15 OF THE ASSESSMENT ORDER. SHRI ASHOK KUMAR SHARMA STATED TH AT HE KEPT THE MONEY IN CASH FOR 21 MONTHS. HE WAS NOT ABLE TO EXPLAIN A S TO WHY THE LAND WAS SOLD AND WHAT WAS THE IMMEDIATE NEED OF THE FUND?. IF ONE CONSIDERS THE FACTS GIVEN IN THE STATEMENT THEN ONE CAN EASILY IN FER THAT SO CALLED AGREEMENT IS JUST A DEVICE TO EXPLAIN THE CASH CRED IT IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. THE ASSESSEE FILED AN AFFIDAVIT OF SHRI RAM KHILARI SHARMA. SHRI RAM KHILARI SHARMA IN HIS STATEMENT HAS GIVEN THE FACT AND EVEN STATED THAT HE HAS GIVEN THE FALSE ASSERTION THAT HE HAS D EPOSITED THE CASH. THE ASSESSEE DID NOT PRODUCE SHRI RAM KHILARI SHARMA ON 27-6-07 AS REQUIRED BY THE AO. IT WAS INTIMATED THAT IN CASE SHRI RAM K HILARI SHARMA IS NOT PRODUCED THEN HIS STATEMENT ON OATH RECORDED EARLIE R WILL BE UTILIZED FOR DRAWING AN ADVERSE INFERENCE. 13 5.3 BEFORE THE LD. CIT(A), THE ASSESSEE RELIED UPON THE AFFIDAVIT OF SHRI RAM KHILARI SHARMA. IT HAS BEEN FURTHER STATED THAT DEPARTMENT HAS NOT BEEN ABLE TO PROVE THAT CASH WAS ALREADY SPENT BY THE AS SESSEE AND IT WAS NOT AVAILABLE. THE LD. CIT(A) AFTER CONSIDERING THE SUB MISSIONS OF THE ASSESSEE CONFIRMED THE ADDITION AFTER OBSERVING AS UNDER:- 6.3 FROM THE ASSESSMENT ORDER IT IS FOUND THAT AFTER RECORDING STATEMENT OF SHRI RAM KHILADI SHARMA, AO ISSUED LETTER TO THE APPELLANT ON 06.03.2007 REQUIRING HIM TO FUR NISH HIS EXPLANATION. THEREFORE ALLEGATION OF APPELLANT THAT EVIDENCE WAS COLLECTED BEHIND HIS BACK AND NO OPPORTUNITY FOR CR OSS EXAMINATI8ON WAS PROVIDED IS ABSURD. MOREOVER AS ME NTIONED BY AO IN THE ASSESSMENT ORDER, SHRI RAM KHI8LADI SHARM A IS RELATED TO THE APPELLANT. SIMILARLY SHRI ASHOK SHARMA IS ON E OF THE EMPLOYEE WORKING IN THE SHOP OF SHRI VIRENDRA KUMAR CHATURVEDI, WHO IS BROTHER OF THE APPELLANT. IN SUCH A SITUATIO N THE BURDEN WAS ON THE APPELLANT TO PROVE GENUINENESS OF HIS CLAIM BY PRODUCING THESE PERSONS BEFORE AO. THE APPELLANT FAILED TO DI SCHARGE THIS BURDEN. AS MENTIONED BY SHRI RAM KHILADI SHARMA IN HIS STATEMENT HE DID NOT GIVE ANY CASH TO APPELLANT DUR ING THE YEAR. IN SUCH A SITUATION AND FOR REASONS DISCUSSED IN DETAI L IN THE ASSESSMENT ORDER, AO HAS RIGHTLY MADE ADDITION OF R S.6,40,000/- TO THE TOTAL INCOME OF THE APPELLANT. THE ADDITION IS CONFIRMED. GROUND NO.3 IS THUS DISMISSED. 14 5.4 WE HAVE HEARD BOTH THE PARTIES. THE ASSESSEE FILED AN AFFIDAVIT OF SHRI RAM KHILARI SHARMA (RETIRED TEACHER) R/0 BRAJLAL NA NGLA, POST KALSADA, TEHSIL BAYANA, DISTT.BHARATPUR. THE AFFIDAVIT IS DA TED 14-03-07. IT IS NOT MENTIONED IN THE AFFIDAVIT THAT SHRI RAM KHILARI SH ARMA WAS EITHER IDENTIFIED BY THE ASSESSEE OR ANY OTHER PERSON. IN THE PAPER BOOK, THE ASSESSEE HAS NOT ATTACHED THE STATEMENT OF SHRI RAM KHILARI SHARMA RECORDED BY THE AO. THE RELEVANT EXTRACTS FROM THE STATEMENT OF SHRI RAM KHILARI SHARMA HAVE BEEN MENTIONED AT PAGE 9 OF THE ASSESSM ENT ORDER. SHRI RAM KHILARI SHARMA CLEARLY STATED THAT THE CONTENTION O F THE ASSESSEE IN RESPECT OF RECEIPT OF CASH OF RS. 5.00 LACS AND RS. 1.40 LACS FROM HIM IS FALSE. THE AO HAS RECORDED THE STATEMENT OF THE PERSON WHO IS SUP POSE TO HAVE RECEIVED THE MONEY AS AGREEMENT FOR SALE OF LAND. THE PERSON HA S ADMITTED THAT HE HAS KEPT THE CASH IN HAND FOR 21 MONTHS. THE AO OBTAINE D THE COPY OF STATEMENT OF THE BANK ACCOUNT OF THE ASSESSEE MAINTAINED IN THE ORIENTAL BANK OF COMMERCE WHERE THE CHEQUES RECEIVED FROM SHRI RAM K HILARI SHARMA WERE CREDITED. THE AO WANTED TO VERIFY THE ENTRIES FROM THE BOOKS OF ACCOUNT. IN CASE THE PAYMENT WAS GIVEN FOR PURCHASE OF LAND THE N THERE SHOULD HAVE BEEN CASH WITHDRAWAL ON THE DATE OF AGREEMENT. NEITHER B EFORE THE AO NOR BEFORE THE LD. CIT(A), THE ASSESSEE HAS BEEN ABLE TO SHOW THAT THERE WERE CASH 15 WITHDRAWALS FOR GIVING ADVANCE FOR PURCHASE OF LAND . IT IS A CASE WHERE ONE HAS TO EVALUATE THE EVIDENCE ON THE BASIS OF THE HU MAN PROBABILITY. 6.1 THE HONBLE APEX COURT IN THE CASE OF CIT V DUR GA PRASAD MORE 82 ITR 540 HAD AN OCCASION TO CONSIDER AS TO WHETHER THE SUM OF RS.2 LAKH IN PURCHASING THE PROPERTY BELONGE D TO HIS WIFE AS THE SAME WAS KEPT WITH HIS FATHER IN LAW IN CASH THROUG H NO APPARENT SOURCE OF INCOME OF WIFE OF ASSESEE WAS THERE. THE HONBLE A PEX COURT AT PAGE 545 OBSERVED. NOW COMING TO THE QUESTION OF ONUS, THE LAW DOES NOT PRESCRIBE ANY QUANTITATIVE TEST TO FIND OUT WHETHE R THE ONUS ON A PARTICULAR CASE HAS BEEN DISCHARGED OR NET. IT ALL DEPENDS ON THE FACTS AND CIRCUMSTANCES OF THE EACH CASE. IN SOME CASES, THE ONUS MAY BE HEAVY WHEREAS IN OTHERS, IT MAY BE NOMINAL. THERE IS NOTHING RIGID ABOUT IT. HEREIN THE ASSESSEE WAS RE CEIVING SOME INCOME. HE SAYS THAT IT IS NOT HIS INCOME BUT HIS WIFES INCOME. HIS WIFE IS SUPPOSED TO HAVE HAD TWO LAKHS OF RUPEE S NEITHER DEPOSITED IN BANKS NOR ADVANCED TO OTHERS BUT SAFEL Y KEPT IN HER FATHERS SAFE. ASSESSEE IS UNABLE TO SAY FROM WHAT SOURCE SHE BUILT UP THAT AMOUNT. IT WAS SAID THAT THE SAID AMOUNT W AS JUST LEFT IN THE HANDS OF THE FATHER IN LAW OF THE ASSESSEE. THE TR IBUNAL DISBELIEVED THE STORY, WHICH IS PRIMA-FACIE A FANTA STIC STORY. IT IS STORY THAT DOES NOT ACCORD WITH HUMAN PROBABILITIES . 6.2 THE HONBLE APEX COURT AT PAGE 546 OBSERVED : SCIENCE HAS NOT YET INVESTED ANY INSTRUMENT TO TE ST THE RELIABILITY OF THE EVIDENCE PLACED BEFORE A COURT O R TRIBUNAL. THEREFORE THE COURTS AND TRIBUNALS APPLYING THE TES T OF HUMAN PROBABILITIES. HUMAN MINDS MAY DIFFER AS TO THE RE LIABILITY OF A PIECE OF EVIDENCE. 16 6.3 THE HONBLE APEX COURT IN THE CASE OF SUMATI DA YAL V CIT 214 ITR 801 HAD AN OCCASION TO CONSIDER AS TO W HETHER THE SETTLEMENT COMMISSION HAS RIGHTLY INFERRED THAT AMOUNT SHOWN A S WINNINGS FROM HORSE RACES IS CONTRIVED AND NOT GENUINE. FOR SUCH PROPOSITION THE SETTLEMENT COMMISSION NOTICED THAT NO DRAWINGS ARE AVAILABLE EITHER IN THE DAY OF WINNING OR PRECEDING DAYS TO PURCHASE JA CKPOT COMBINATION TICKETS. IT WAS NOTICED THAT ASSESSEE WON A NUMBER OF JACKPOT IN THREE OR FOUR REASONS NOT MERELY AT ONE PLACE BUT AT THREE D IFFERENT CENTRES NAMELY MADRAS, BANGALORE AND HYDERABAD AND SUCH WINNINGS A RE PRIMA-FACIE WILL AND CONTRARY TO STATISTICAL THEORIES AND EXPERIENCE OF THE FREQUENCIES AND PROBABILITIES CONSIDERING THE CONCLUSION DRAWN BY S ETTLEMENT COMMISSION ON THE BASIS OF FACTS AS ABOVE, THE HONBLE APEX CO URT OBSERVED :- IN OUR OPINION THE MAJORITY OPINION AFTER CONSIDER ING THE SURROUNDING CIRCUMSTANCES AND APPLYING THE TEST OF HUMAN PROBAB ILITIES HAS RIGHTLY CONCLUDED THAT THE CLAIM ABOUT THE AMOUNT BEING WIN NINGS FROM RACES IS NOT GENUINE. IT CAN NOT BE SAID THAT EXPLANATION O FFERED BY THE ASSESSEE IN RESPECT OF THE SAID AMOUNTS HAS BEEN REJECTED UNREA SONABLY AND THAT FINDING THAT THE SAID AMOUNTS ARE INCOME OF THE ASS ESSEE FROM OTHER SOURCES IS NOT BASED AN EVIDENCE. 6.4 BURDEN OF PROOF MEANS THAT ONE OF THE CONTENDIN G PARTY HAS TO INTRODUCE EVIDENCE. WHERE HOWEVER PARTIES HAVE J OINED ISSUE AND HAVE LED EVIDENCE AND CONFLICTING EVIDENCE THEN THE ISSU E CAN BE WEIGHED TO DETERMINE WHICH WAY THE ISSUE CAN BE DECIDED, THE A BSTRACT QUESTION OF BURDEN OF PROOF IS ACADEMIC. HENCE ONE IS LEFT BUT TO TEST THE EVIDENCES ON RECORD AN THE BASIS OF HUMAN PROBABILITY. IT HAS B EEN NOTICED THAT THERE ARE ENTITIES WHICH ARE ONLY PROVIDING BILLS BUT ON THAT BASIS ONLY, AN ADDITION CAN NOT BE MADE. BUT IF THE ASSESSEE ALSO FAILS TO LEAD EVIDENCE ABOUT GENUINENESS OF PURCHASES THEN ONE WILL HAVE TO WEIG H ALL THE MATERIALS AVAILABLE WITH A.O. AND HAS TO DERIVE A CONCLUSION BASED AN HUMAN PROBABILITY. 6.5 IT IS NOW A SETTLED PROPOSITION OF LAW THAT THE ASSESSING OFFICER LIFT THE VEIL AND ENQUIRE INTO THE REAL NAT URE OF THE TRANSACTION. THE TRANSACTION AS MENTIONED IN THE BOOKS OF ACCOUNT IS RESPECT OF PURCHASE OF 17 ITEMS BEING TRADED FROM A PARTICULAR PARTY. THE GE NUINENESS IF SUCH PARTY HAS NOT BEEN CONCLUSIVELY PROVED. HENCE WHETHER TH E PURCHASE OF ITEM IS ON CREDIT OR CASH IS NOT VERIFIABLE AND CREDIT ENTR Y IS SHOWN TILL THE END OF ACCOUNTING YEAR. 6.6 SELF INTEREST TALKS IN ALL SORTS OF TONGUES AND PLAYS ALL SORTS OF ROLES. THE INDIFFERENCE OF NOT PRODUCING THE PA RTY WHICH ISSUED THE BILL IS INDICATIVE OF THE TRUTH. THE REVENUE IS NOT DOU BTING ALL THE PURCHASES BUT DOUBTING ONLY THOSE PURCHASES FOR WHICH THE INVESTI GATION WING OF THE DEPARTMENT NOTICED THAT CERTAIN PARTIES WERE ONLY P ROVIDING BILLS AS AND WHEN AMOUNT IS RECEIVED IN THE FIRM OF CHEQUE THE S AME IS WITHDRAWN IN CASH BY SOME PARTIES. ONE CAN NOT LOSE SIGHT OF TH E FACT THAT DARK DEEDS ARE PERFORMED UNDER THE COVER OF DARKNESS AND DIREC T EVIDENCE CAN NEVER BE AVAILABLE. SOMETIMES THE FACTS SPEAK LOUD AND C LEAR. 5.5 THE HON'BLE APEX COURT IN THE CASE OF CIT VS P MOHAN KALA, 291 ITR 278 HELD THAT THE AO IS REQUIRED TO FORM AN OPI NION OBJECTIVELY WITH REFERENCE TO THE MATERIAL AVAILABLE ON RECORD. THE APPLICATION OF MIND IS SINE QUA NON FOR FORMING AN OPINION . CONSIDERING THE HUMAN PROBABILITY, WE FEEL THAT THE LD. CIT(A) WAS JUSTIFIED IN CONFIRMING THE ADDITION OF RS. 6.40 LACS 6.1 THE FOURTH GROUND OF THE ASSESSEE IS THAT THE L D. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 14,80,090/- ON ACCOU NT OF ADVANCE RECEIVED FROM VARIOUS PARTIES. 6.2 THE AO DURING THE COURSE OF ASSESSMENT PROCEEDI NGS NOTICED THAT THE ASSESSEE HAS SHOWN A SUM OF RS. 14,80,090/- AS ADV ANCE FROM VARIOUS CUSTOMERS. THE ASSESSEE WAS REQUIRED TO GIVE THE CO MPLETE ADDRESSES AND 18 IDENTITY OF THE PERSONS WHO HAVE MADE ADVANCE. THE AO ALSO ASKED THE ASSESSEE TO PRODUCE THE PERSONS FROM WHOM ADVANCE H AVE BEEN RECEIVED. NO REPLY WAS FILED BY THE ASSESSEE AND THEREFORE, A RE MINDER WAS ISSUED ON 31- 08-07. THE AO AGAIN SENT THE REMINDER DATED 17-10-0 7 TO THE ASSESSEE FOR FURNISHING THE DETAILS AND PRODUCING THE PERSON. NO DETAILS WERE FILED. THE LAST OPPORTUNITY WAS GIVEN FOR 3 RD DEC. 07. SINCE NO INFORMATION WAS FILED THEREFORE, THE AO ADDED A SUM OF RS. 14,80,090/- AS UNDISCLOSED INCOME. 6.3 BEFORE THE LD. CIT(A), THE ASSESSEE FILED THE C OPIES OF THE LEDGER ACCOUNTS OF VARIOUS CUSTOMERS TO WHOM TRACTORS WERE DELIVERED. ALL THE TRACTORS WERE GOT FINANCED THROUGH THE ASSESSEE FRO M THE BANK. THE ASSESSEE WAS RECEIVING THE ADVANCE AT THE TIME OF BOOKING BE ING A GENERAL TRADE PRACTICE. THE LD. AR RELIED UPON THE DECISION OF HO N'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SMT., HARSHILA CHORDIA VS ITO, 208 CTR 208. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASS ESSEE CONFIRMED THE ADDITION OF RS. 14,80,090/- AFTER OBSERVING AS UNDE R:- 7.3 ARGUMENT OF THE APPELLANT HAS BEEN CONSIDERED BUT THE SAME IS NOT ACCEPTABLE. THE APPELLANT HAS FILED VARIOUS DETAILS IN HIS PAPER BOOK. FROM THE PERUSAL OF RECORDS IT I S FOUND THAT THE SAME WERE NOT MADE AVAILABLE TO THE AO. NO REASON H AS BEEN GIVEN AS TO WHY THE SAME WERE NOT PRODUCED BEFORE A O, DESPITE BEING GIVEN REPEATED OPPORTUNITIES. IN SUCH A SITUA TION I REFUSE TO 19 ENTERTAIN THE ADDITIONAL EVIDENCE FILED BY APPELLAN T IN FORM OF PAPER BOOK. IT IS A USUAL TENDENCY AMONG CERTAIN AP PELLANTS AND THEIR COUNSELS TO DELIBERATELY AVOID FURNISHING OF REQUIRED DETAILS BEFORE AO DURING ASSESSMENTS PROCEEDINGS. SUBSEQUEN TLY ALL THE DETAILS ARE FURNISHED BEFORE APPELLATE AUTHORITIES AND IT IS ARGUED THAT AO DID NOT PROVIDE SUFFICIENT OPPORTUNITY. THI S TENDENCY NEEDS TO BE STRONGLY DISCOURAGED. IN THIS CASE IT I S CLEARLY MENTIONED IN THE ASSESSMENT ORDER THAT APPELLANT WA S ASKED TO FURNISH DETAILS FROM TIME TO TIME WHICH HE DID NOT FURNISH. UNDER THE CIRCUMSTANCES AO HAS RIGHTLY MADE ADDITION OF R S.14,80,090/-. THE ADDITION IS CONFIRMED. GROUND NO.4 OF THE APPEA L IS THUS DISMISSED. 6.4 WE HAVE HEARD BOTH THE PARTIES. THE AO HAS PROV IDED SUFFICIENT OPPORTUNITIES TO THE ASSESSEE TO GIVE COMPLETE ADDR ESSES OF THE PERSONS FROM WHOM THE ADVANCE HAS BEEN RECEIVED. NO DETAILS WERE FILED BEFORE THE AO. THE LD. CIT(A) HAS NOT ADMITTED THE COPIES OF THE L EDGER ACCOUNT BY TREATING THE SAME AS AN ADDITIONAL EVIDENCE. THESE DETAILS W ERE NOT FILED BEFORE THE AO. IN CASE THE ASSESSEE HAS SOLD THE TRACTORS TO S UCH PERSONS WHO HAVE PAID THE ADVANCE THEN THE IDENTITY OF SUCH PERSONS CAN B E VERIFIED FROM THE R.T.O. OFFICE BECAUSE THE TRACTORS ARE TO BE REGISTERED. H ENCE, THIS ISSUE IS REQUIRED TO BE RESTORED BACK ON THE FILE OF THE AO. THE ASSE SSEE WILL FILE THE LEDGER ACCOUNT OF THE PERSONS WHO HAVE MADE THE ADVANCE AN D THE ASSESSEE WILL ALSO FILE ALL THE NECESSARY DETAILS TO THE AO FROM HIS RECORD IN RESPECT OF SUCH PERSONS. WHEN A TRACTOR IS SOLD THEN COMPLETE ADDRE SS IS TO BE MENTIONED IN 20 THE PURCHASE BILL AND THE REGISTRATION IS ALSO TO B E DONE THROUGH THE DEALER. HENCE, THE ISSUE OF ADDITION OF RS. 14,80,090/- IS RESTORED BACK ON THE FILE OF THE AO. 7.1 THE FIFTH GROUND OF THE ASSESSEE IS THAT THE L D. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 68,250/- ON ACCOUNT OF CREDIT APPEARING IN THE NAME OF THE GOVT. OFFICES AGAINST SALES MADE TO THE M. 7.2 THE AO DURING THE COURSE OF ASSESSMENT PROCEEDI NG NOTICED THAT THE ASSESSEE HAS SHOWN RECEIPTS ON DIFFERENT DATES IN T HE MONTH OF APRIL, 2004. THE AMOUNTS HAVE BEEN SHOWN TO HAVE BEEN RECEIVED F ROM SHRI ATTAR SINGH (RS.18,600), SHRI UDAI BHAN (RS.15,650), DISTT POOL OFFICE (RS. 18,000) AND S.P. OFFICE (RS.16,000). THE ADDRESSES OF SHRI ATTA R SINGH AND SHRI UDAI BHAN WERE NOT GIVEN. A SUM OF RS. 18,000/- WAS RECEIVED FROM DISTRICT POOL OFFICE AND RS. 16,000/- FROM S.P. OFFICE. THE AO ACCORDINGLY ADDED A SUM OF RS. 68,250/- SHOWN AS RECEIVED IN CASH IN TH E MONTH OF APRIL, 2004. THE ADDITION HAS BEEN CONFIRMED BY THE LD. CIT(A). 7.3 WE HAVE HEARD BOTH THE PARTIES. THE AMOUNTS WHI CH ARE RECEIVED FROM GOVT. OFFICES ARE ON THE BASIS OF THE BILLS ISSUED. THE CONTENTION OF THE LD. AR WAS THAT THE BILLS WERE ISSUED IN THE IMMEDIATEL Y PRECEDING YEAR AND THE PAYMENTS MADE BY GOVT. OFFICES WERE ADJUSTED IN THE IR BUDGET BEFORE 31-03- 04. HOWEVER, THE AMOUNTS WERE RECEIVED BY THE ASSES SEE IN THE MONTH OF 21 APRIL, 2004. IN CASE THE AMOUNTS HAVE BEEN RECEIVED ON THE BASIS OF CERTAIN BILLS ISSUED THEN THE ASSESSEE CAN GET SUCH RECEIPT S VERIFIED FROM THE BILLS ISSUED BY THE GOVT. OFFICES. IF THE ASSESSEE HAS NO T BEEN ABLE TO CORRELATE SUCH RECEIPTS FROM THE BILLS ISSUED IN THE MONTH OF MARCH, 2004 THEN THE AMOUNTS WILL REMAIN ADDED TO THE INCOME OF THE ASSE SSEE. HENCE, THIS ISSUE IS RESTORED BACK ON THE FILE OF THE AO FOR VERIFICATIO N. THE MATTER IS RESTORED FOR ADDITION OF RS. 34,000/- FROM GOVT. OFFICES AND BAL ANCE ADDITION IS CONFIRMED. 8.1 THE SIXTH GROUND OF THE ASSESSEE IS THAT THE L D. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 1,45,000/- ON ACCOUN T OF SALE OF CAR. 8.2 THE AO NOTICED THAT THE ASSESSEE HAS SHOWN THE SALE OF HIS MARUTI CAR AT RS. 1.45 LACS TO ONE SHRI BALMUKAND SONI. THE AO REQUIRED THE ASSESSEE TO FILE THE EVIDENCE IN RESPECT OF PURCHASE OF CAR AND TO GIVE COMPLETE ADDRESS OF THE PERSON TO WHOM THE CAR HAS BEEN SOLD . NO INFORMATION WAS FILED BEFORE THE AO. THE AO ACCORDINGLY ADDED A SUM OF RS. 1.45 LACS. 8.3 THE LD. CIT(A) HAS CONFIRMED THE ADDITION AFTER OBSERVING AS UNDER:- 9.3 THE APPELLANT WAS REQUIRED TO FURNISH DOCUMENTARY EVIDENCE IN THIS REGARD BEFORE AO, WHICH WAS NOT DO NE. AT LEAST THE COPY OF SALE AGREEMENT AND COPIES OF FORM 29 AN D FORM 30 OF RTO SHOULD HAVE BEEN PRODUCED. IN THE ABSENCE OF AN Y SUCH EVIDENCE PRODUCED EITHER BEFORE AO OR THE UNDE3R SI GNED, CLAIM OF 22 APPELLANT CANNOT BE ACCEPTED. MOREOVER IN 2004-05, IT WAS NOT POSSIBLE TO SALE AN OLD MARUTI 800 CAR FOR RS.1,45, 000/-. AO HAS THEREFORE RIGHTLY MADE ADDITION OF RS.1,45,000/-. T HE ADDITION IS CONFIRMED. GROUND NO.6 IS THUS DISMISSED. 8.4 WE HAVE HEARD BOTH THE PARTIES. THE ASSESSEE HA S FAILED TO PRODUCE THE EVIDENCE WHICH WERE REQUIRED BY THE AO. SUCH EVIDEN CE HAS NOT BEEN FILED EVEN BEFORE THE LD. CIT(A). BEFORE US, THE LD. AR R EFERRED TO THE BLOCK OF ASSETS WHICH SHOWS THE OPENING BALANCE IN CAR ACCOU NT. THE COPY OF LEDGER ACCOUNT IS AVAILABLE AT PAGE 52 OF THE PAPER BOOK. THE CREDIT IN RESPECT OF SALE OF CAR IS LESS THAN THE OPENING BALANCE. THE S ALE PROCEEDS OF CAR IS ADJUSTED IN THE BLOCK OF ASSETS OF CAR AND DEPRECIA TION IS TO BE GIVEN. THUS THE ASSESSEE HAS CLAIMED LESS DEPRECIATION. HENCE, THERE WAS NO CASE OF MAKING ENTIRE ADDITION OF RS. 1.45 LACS. HOWEVER, W E ARE NOT HAVING THE BENEFIT OF THE ACCOUNTS ATTACHED WITH THE RETURN FO R THE ASSESSMENT YEAR 2004-05. IN CASE THE ASSESSEE HAS CLAIMED DEPRECIAT ION ON CAR AND THE SAME HAS BEEN ALLOWED THEN IT IS ESTABLISHED THAT THE AS SESSEE WAS HAVING THE CAR. THE AO WILL VERIFY FROM THE RETURN FOR EARLIER YEAR IN RESPECT OF AVAILABILITY OF CAR IN BLOCK OF ASSETS AND IN CASE DEPRECIATION HAS BEEN ALLOWED THEN EVIDENCE IN RESPECT OF HAVING CAR STANDS ESTABLISHE D AND NO ADDITION WILL HAVE TO BE MADE. WE THEREFORE, RESTORE THIS ISSUE O N THE FILE OF THE AO. 23 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 26-08 -2011. SD/- SD/- (R.K. GUPTA) (N.L. KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR DATED; 26/08/2011 *MISHRA COPY FORWARDED TO :- 1. SHRI NARENDRA KUMAR CHATURVEDI, HINDAUN CITY 2. THE ITO,WARD 3, SWAI MADHOPUR 3. THE LD. CIT BY ORDER 4. THE LD. CIT(A) 5. THE LD.DR 6. THE GUARD FILE (ITA NO.1015/JP /10) A.R, ITAT, JAIPUR 24 25 26