M/s Kalpana Biri Mfg. Co. Pvt. Ltd., Murshidabad V. ACIT, CIR- MURSHIDABAD, Murshidabad

ITA 1020/KOL/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1004 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 15-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH KUMAR
• Assessee Lawyers: S L KOCHAR
• Keywords: Unexplained investment; Search and seizure; Competent authority; Retraction
• Section: 69C; 143(3); 133A; 131; 69

Judgement Text

, B , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO.1020/KOL/2014 ASSESSMENT YEAR:2010-11 M/S KALPANA BIRI MFG. CO. PVT. LTD., VILL. & P.O. AURAGABAD DIST. MURSHIDABAD, PIN-742 201 [ PAN NO. AABCK 7051 M ] / V/S . ACIT, CIRCLE, MURSHIDABAD, 39 R.N. TAGORE ROAD, P.O. BERHAMPUR, PIN. 742 101 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI S.L. KOCHAR, ADVOCATE & SHRI ANIL KOCHAR, ADVOCATE /BY RESPONDENT SHRI SAURABH KUMAR, ADDL. CIT-DR /DATE OF HEARING 18-09-2017 /DATE OF PRONOUNCEMENT 10-11-2017 /O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER O F COMMISSIONER OF INCOME TAX (APPEALS)-XXXVI, KOLKATA DATED 31.03.2014. ASSE SSMENT WAS FRAMED BY ACIT, CIRCLE-MURSHIDABAD U/S 143(3) OF THE INCOME TAX ACT , 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 13.02.2013 FOR ASSE SSMENT YEAR 2010-11. THE GROUNDS RAISED BY THE ASSESSEE PER ITS APPEAL ARE AS UNDER: - 1. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN NOT HAVING DELETED THE ADDITION TO INCOME FOR RS.30628425/- AS ALLEGED UNEXPLAINED INVESTMENT U/S 69 OF THE INCOME TAX ACT, 1961 ON ACCOUNT OF ALLEGED SUPPRESSION OF VALUE OF STOCK. ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 2 SHRI S.L. KOCHAR AND SHRI ANIL KOCHAR LD. ADVOCATE APPEARED ON BEHALF OF ASSESSEE AND SHRI SAURABH KUMAR, LD. DEPARTMENTAL REPRESENTA TIVE APPEARED ON BEHALF OF REVENUE. 2. SOLITARY ISSUE RAISED BY ASSESSEE IN THIS APPEAL IS THAT LD. CIT(A) ERRED IN CONFIRMING THE ORDER OF ASSESSING OFFICER BY SUSTAI NING THE DISALLOWANCE OF 3,06,28,425/- ON ACCOUNT OF UNEXPLAINED INVESTMENT U/S 69 OF THE ACT. 3. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS A PRIV ATE LIMITED COMPANY AND ENGAGED IN MANUFACTURING / TRADING OF BIDI AND TRADER OF EL ECTRONIC GOODS. THE ASSESSEE CARRIES ON ITS MANUFACTURING OF BIDI ACTIVITY UNDER THE TRA DE NAME M/S KALPANA BIRI MANUFACTURING CO. PVT. LTD. THE ASSESSEE HAS ITS MA NUFACTURING UNITS / BRANCHES FOR BIDI AT THREE PLACES AS DETAILED UNDER: A) AURANGABAD FACTORY B) OMARPUR BRANCH C) 16 MILE MALDA BRANCH SIMILARLY, ASSESSEE WAS CARRYING ON ITS ELECTRONIC BUSINESS UNDER TWO NAMES AT TWO DIFFERENT PLACES AS DETAILED UNDER:- I) KBM ELECTRONICS, HAVING ITS ADDRESS AT 1/32, MAN VIKAS MARG, NEW DELHI- 92 II) KALPANA DIGITAL WORLD, HAVING ITS ADDRESS AT 1/ 10, 12 MAIN VIKASH MARG, NEW DELHI-92 THE ASSESSEE FILED ITS RETURN OF INCOME DATED 29.09 .2010 DECLARING ITS TOTAL CONSOLIDATED INCOME OF 2,35,99,186/- WHICH WAS PROCESSED U/S 143(1) OF THE ACT DATED 20.04.2011. A SURVEY WAS CONDUCTED ON 29.03.2 010 AT AURANGABAD FACTORY OF ASSESSEE. THUS THE CASE WAS SELECTED UNDER SCRUTINY MANUALLY AS PER THE CBDT ACTION PLAN. 4. DURING THE COURSE OF SURVEY PROCEEDINGS A STATEM ENT U/S 131 AND 133A OF THE ACT WAS RECORDED OF MR. ALAUDDIN BISWAS, DIRECTOR O F THE ASSESSEE-COMPANY AND RELEVANT EXTRACT OF THE STATEMENT IS REPRODUCED BEL OW:- STATEMENT OF SRI ALAUDDIN BISWS S/O SRI SIDDIQUE BI SWAS, DIRECTOR OF M/S KALPNA BIRI MFG. CO PVT.LTD., AT COLLEGE PARA, P.O. AURANG ABAD, DIST. MURSHIDABAD, RECORDED AT BUSINESS PREMISE, IN RESPONSE TO NOTIC E U/S. 131 OF THE I.T. ACT. ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 3 I DO SWEAR IN THE NAME OF GOD (ALLAH) WHATEVER I SH ALL SPEAK THE TRUTH AND NOTHING BUT THE TRUTH. SD/- ALAUDDIN BISWAS 29.3.10 ALAUDDIN BI SWAS 29.03.2010 OATH TAKEN BY OATH GIVE BY Q. NO.1 PLEASE IDENTIFY YOURSELF? ANS I AM SRI ALAUDDIN BISWAS S/O SRI SIDDIQUE BISW AS, DIRECTOR OF M/S KALPANA BIRI MFG CO. (PVT) LTD, RESIDING AT COLLEGEPARA, P.O. AU RANGABAD, DIST. MSD, AGED ABOUT 46 YEARS. Q. NO.2 YOU HAVE STATED THAT THERE ARE TWO OTHER UN IT IN MALDA 7 OMARPORE. YOU ALSO INFORMED THAT THERE ARE TWO GODOWNS OUTSIDE OF AURA NGABAD UNIT AT COLLEGEPARA NEAR BY THE MFG. UNIT AURANGABAD) AND AT DAFAHAT, DO YOU HAVE ANY OTHER UNIT OR GODOWN. ANS. 2 WE DONT HAVE ANY OTHER UNIT OR GODOWN IN MU RSHIDABAD. WE HAVE ONLY SALE UNIT IN DELHI & PANDUA (HOOGHLY). Q. NO.3: TOTAL CASH FOUNDS IN YOUR BUSINESS PREMISE S (AURANGABAD) IS RS.14,96,160/- BUT AS PER CASH BOOK ONE CASH BALANCE RS.15,64,765/ - ON 28.9.10 WHY THE DIFF. ARISES. ANS 3: WE HAVE EXPENDED THE DIFF. MONEY I.E. RS.68, 606/- FOR EXPENSES DURING TODAY I.E. ON Q. 4: GIVE THE CLOSING STOCK OF BIRI AND MAJOR RAW MATERIAL AS BIRI LEAVES AND TOBACCO BILL DATE. ANS. SIR, AS PER STOCK REGISTER THE CLOSING STOCK O F BIRI LEAVES, TOBACCO & BIRI ARE AS FOLLOWINGS:- AURANGABAD MALDA OMARPUR TENDU LEAVES 6,72,695 KG 1,93,49 KG 8,962 KG TOBACCO 2,70,877 KG 9,337 KG. 9420 KG BIDI 1,27,18,440 STOCKS 2,20,85,880 STOCKS 94,28,36 0 STOCKS QUT 5:- AS PER PHYSICAL STOCK TAKEN BY SURVEY TEAM IN PRESENCE OF YOUR EMPLOYEE AS YOU IS AS FOLLOWING:- TOBACCO LEAVES AURANGABAD (FACTORY) 4,80,300 KG 8005 BAG (60 KG/BA G) AURANGABAD OUTSIDE FACTORY GODOWN COLLEGE PARA) 1,74,960 KG 2916 BAGS 60 KG/BAG AURANGABAD (DATHATA GARDEN) 1,47,600 KG 56,800 KG 3280 BG OF 45 KG 948 BAGS OF 60 KG) OMARPORE (FACTORY) 4050 KG 5700 KG 90 BAGS OF 45 KG 95 BAGS OF 60 KG MALDA (FACTORY) 1,98,600 KG 3310 KG OF 60 KG BAG TOTAL 10,62,880 KG. TOBACCO:- AURANGABAD (FACTORY) 8832 BAGS OF 36 KG. 3,17,952 K G OMARPORE (FACTORY) 487 BAGS OF 36 KG 17,532 KG MALDA (FACTORY) 416 BAGS OF 36 KG 14,976 KG ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 4 TOTAL 3,50,460 KG BIDI: - BIDI VARIETY MANU-13 MAN 25 KALPA 25 BHANAT 25 PAR BADI AURANGABAD (FACTORY) 150 PKT X 37440 56,16,000 STOCK 115 PKT X 48000 55,20,000 STOCK 82 PKT X 48000 39,36,000 STOCK 82 PKT X 48000 3936000 STOCK 178 PKT X 31680 56,39,040 STOCK 2,4647,040 STOCK MALDA 162 PKT X 37440 60,65,280 STOCK 123 PKT X 48,000 59,04,000 STOCK 93 PKT X 48000 44,64,000 STOCK 117 PKT X 48000 56,16,000 STOCK 184 PKT X 31680 58,29,120 STOCK 478784 STOCK OMARPUR 58 PKT X 37440 21,71,520 82 PKT X 48000 34,36,000 62 PKT X 48000 29,76,000 58 PKT X 4800 27,84,000 53 PKT X 31680 16,79,040 43546 TOTAL 6,60,72,000 ABOVE MENTIONED VALUATION (PHYSICAL) IS DONE IN FRO NT OF YOUR EMPLOYEE AS YOU STATED AND MENTIONED AS EMPLOYED. ARE YOU SATISFIED WITH T HE ABOVE VALUATION AND DIFF. ARISEN DUE TO MIS VALUE WITH YOUR ANSWER. ANS 5: SIR, I AM STATED WITH VALUATION MADE BY SURV EY TEAM AS IT IS TAKEN IN FRONT OF ME ON MY EMPLOYEE. BUT I AM NOT SURE WITH THE DIFF. OF STOCK TAKEN BY SURVEY TEAM AND MY STOCK REGISTER. Q. 6: AS YOU SAID THAT YOU ARE NOT SURE ABOUT THE D IFFERENCE ARISES DUE TO PHYSICAL VALUATION MADE BY SURVEY TEAM. SHOULD WE AGAIN PHYS ICALLY VALUE YOUR STOCK IN FRONT OF YOU. ANS.6 : NO, SIR, AT IS NOT REQUIRED. Q. 7: WHAT IS THE AVERAGE MARKET RATE OF TENDU LEAV ES, TOBACCO & BIRI ANS 7: SIR, AVERAGE MARKET RATE OF TENDU LEAVES, TO BACCO, & BIRI ARE AS FOLLOWING:- TEDU LEAVE RS.95 PR KG TOBACCO RS.128 PER KG BIRI RS.210 PER 1000 STROKES Q. 7: STOCK DIFF. AS PER STOCK VALUED BY SURVEY TEA M & STOCK DISCLOSED BY YOU AS FOLLOWING: MATERIAL VALUATION OF STOCK BY SURVEY TEAM VALUE OF STOCK/DIFF. AS PER YOUR STATEMENT (1) TENDU LEAVES 10,62,880 KG 8,75,27 KG 1,87,752 1,78,3641 (2) TOBACCO 3,50,460 KG 2,89,634 KG 60826 X 12 RS.77857 (3) BIDI 6,60,72,000 STOCK 4,22,32,680 STOCK 438,39,320 X RS.5,00625 TOTAL DIFF. IN RS. RS.3,06,28,425/- ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 5 I.E. TOTAL DIFF. IN RS. IS 3,06,28,425/- OF THE STO CK VALUED BY SURVEY TEAM AND STOCK DISCLOSED BY YOU ON DATE OF SURVEY. WHAT DO YOU WAN T TO SAY IN THIS RESPECT. AS YOU READY TO ACCEPT THE SURVEY FINDING. ANS 7: SIR, AS I HAVE ALREADY SAID THAT I AM SATISF IED WITH THE VALUATION TAKEN BY SURVEY TEAM BUT I AM NOT SURE WITH THE DIFF. OF STO CK TAKEN BY SURVEY TEAM AND MY STOCK REGISTER. I AM ACCEPTING THE SURVEY FINDING. Q. 8: ON THE BASIS OF ABOVE SURVEY FINDING AT IS CL EAR THAT THE TOTAL UNDISCLOSED INCOME WOULD BE NONE TAKEN 3 CRORE. I AM GIVING YOU A CHANCE TO DISCLOSE THE INCOME WHICH YOU HAVE CONSIDERED IN THIS CURRENT YEAR TILL DATE. ANS 8: SIR, I AM ACCEPTING THE SURVEY FINDING AND O N THE BASIS OF SURVEY FINDING I AM DISCLOSING RS. 3.00 CRORE AS ADDITIONAL INCOME IN T HIS CURRENT YEAR AND IMMEDIATELY PAYING RS.50 LAKH AS ADVANCE TAX. I AM ALSO GIVING TWO POST DATED CHEQUE OF RS.25 LAKH EACH DATED 30.04.10 AND 30.06.10 RESPECTVELY. Q. 9 DO YOU WANT TO SAY ANYTHING ELSE? ANS 9: NO, SIR, THANK YOU. THE ABOVE STATEMENT GIVEN BY ME TO THE BEST OF MY K NOWLEDGE AND BELIEF AND WITHOUT ANY FORCE OR COERCION AND SECOND MIND. SD/- ALAUDDIN BISWAS 29.3.10 FROM THE ABOVE STATEMENT, IT IS CLEAR THAT ASSESSEE DURING THE COURSE OF SURVEY PROCEEDINGS ACCEPTED UNDER VALUATION OF CLOSING STO CK FOR 3,06,28,425/-. HOWEVER, ASSESSEE HAS NOT OFFERED THE SAME IN ITS RETURN OF INCOME. THEREFORE, AO CALLED UPON THE ASSESSEE TO EXPLAIN WHY THE STOCK FOUND DURING THE COURSE OF SURVEY SHOULD NOT BE ADDED TO ITS TOTAL INCOME. IN RESPONSE TO THE NOTIC E THE ASSESSEE MADE THE SUBMISSION AS DETAILED UNDER:- A) THE SURVEY WAS CONDUCTED AT THE AURANGABAD FACTORY OF THE ASSESSEE ONLY BUT THERE WERE TWO MORE BRANCHES OF ASSESSEE AS DIS CLOSED BUT NO SURVEY WAS CONDUCTED AT OTHER BRANCHES. THUS, NO PHYSICAL INSPECTIONS OF THE STOCKS LYING ON THE BRANCHES WERE CARRIED OUT BY SU RVEY TEAM. B) NO DISCREPANCY OF WHATSOEVER HAS BEEN POINTED OUT B Y THE SURVEY TEAM IN THE BOOKS OF ACCOUNT OF ASSESSEE. THEREFORE, THERE IS NO QUESTION OF ANY UNDER VALUATION OF CLOSING STOCK WHICH IS NOT RECOR DED IN THE BOOKS OF ACCOUNT. C) THE STATEMENT U/S 131 OF THE ACT WAS RECORDED UNDER COERCION. THE ASSESSEE WAS FORCED TO MAKE THE PAYMENT OF TAX FOR RS.1 CROR E BY 31.03.2010. ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 6 D) THE ASSESSEE IMMEDIATELY APPLIED FOR THE CERTIFIED COPY OF THE STATEMENT GIVEN DURING SURVEY PROCEEDINGS ON 07.04.2011 AND P AID THE PRESCRIBED FEES VIDE CHEQUE NO. 65213 DATED 07.04.2010 BSR CODE 051 0308 FOR RS.1,000/-. BUT THE SAME WAS NOT SUPPLIED TO THE ASSESSEE. THE ASSESSEE FURTHER APPLIED FOR THE CERTIFIED COPY OF THE STATEMENT GIVEN U/S 1 31 OF THE ACT VIDE APPLICATION DATED 14.03.2012 AFTER MAKING THE PRESC RIBED FEES OF 2,000/-. HOWEVER, ASSESSEE WAS GIVEN THE CERTIFIED COPY OF T HE STATEMENT ON 14.03.2012 THEREAFTER ASSESSEE FILED THE RETRACTION STATEMENT BY SUBMITTING AN AFFIDAVIT DATED 30.01.2013. THE CONTENTION OF TH E RETRACTION STATEMENT READS AS UNDER:- AFFIDAVIT I, ALAUDDIN BISWAS SON OF SIDDIQUE BISWAS OF VILL & P.O. AURANGABAD, PS SUTI DIST. MURSHIDABAD, DIRECTOR OF M/S KALPANA BIRI MFG . CO. PVT. LD. HAVING REGISTERED OFFICE AT AURANGABAD, PO AURANGABAD IN T HE DISTRICT OF MURSHIDABAD, DO HEREBY SOLEMNLY DECLARE AND AFFIRM AS FOLLOW:- 1. THAT ON 29 TH MARCH, 2010 A SURVEY TEAM OF THE INCOME TAX DEPART MENT PAID A VISIT TO THE AURANGABAD FACTORY OF OUR COMPANY M/ S KALPANA BIRI MFG. CO. PVT. LTD FOR THE PURPOSE OF SURVEY UNDER SECTION133 A OF THE INCOME TAX ACT, 1961. 2. THE SURVEY TEAM DULY PRODUCED THE AUTHORISATION LET TER FOR CONDUCTING THE SURVEY. THE SURVEY TEAM WAS ATTENDED BY ME MR. ALAU DDIN BISWAS, ONE OF THE DIRECTOR OF THE COMPANY UPON PRODUCTION OF THE SAID AUTHORIZATION LETTER: READ OVER AND EXPLAINED IN VERNACULAR TO ALAUDDIN B ISWAS A) WE AFFORDED EVERY FACILITY TO THE INCOME TAX AUTHOR ITY TO INSPECT ITS BOOKS OF ACCOUNTS, OTHER DOCUMENTS AS REQUISITIONED. ALL THE BOOKS OF ACCOUNTS THAT ARE MAINTAINED WERE PRODUCED BEFORE THE AUTHOR ITY FOR THE PURPOSE OF THE INSPECTION. THE SURVEY TEAM DULY INSPECTED THE BOOKS OF ACCOUNTS, OTHER DOCUMENTS AS THEY REQUIRED AND MADE OR CAUSED TO BE DE EXTRACTS OR COPIES THEREFROM. B) DURING THE INSPECTION, THE SURVEY TEAM ALSO DIRECTE D US TO PRODUCE BIRI STOCK BOOK, LEAVES STOCK REGISTER AND TOBACCO STOCK REGISTER OF OUR OTHER TWO MANUFACTURING UNIT/BRANCHES NAMELY OMARPUR BRAN CH AND 16 MILE MALDA BRANCH OF THE COMPANY FOR THE PURPOSE OF THEI R INSPECTION. ACCORDING TO THE DIRECTION OF THE SURVEY TEAM, WE B ROUGHT THOSE BOOKS FROM THOSE BRANCHES AND PRODUCED THOSE BOOKS FOR TH E PURPOSE OF INSPECTION OF THE SURVEY TEAM. HOWEVER NONE OF THE SURVEY TEAM MEMBERS PHYSICALLY VISITED THOSE BRANCHES. C) WE ALSO AFFORDED THEM THE NECESSARY FACILITY TO CHE CK AND VERIFY THE CASH, STOCK OF RAW MATERIALS AND FINISHED GOODS AND OTHER VALUABLE ARTICLES OR THINGS WHICH WERE FOUND IN THE OUR COMPANYS AURANG ABAD FACTORY. D) AN INVENTORY OF CASH OF RS.14,96,160.00(RUPEES FOUR TEEN LACS NINETY SIX THOUSAND ONE HUNDRED SIXTY) ONLY OF AURANGABAD FACT ORY WAS PREPARED. ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 7 E) AN INVENTORY OF BOOKS OF ACCOUNT, (OF THOSE BOOKS O F ACCOUNTS WHICH THEY THOUGHT NECESSARY) WAS ALSO PREPARED, PLACED MARKS OF IDENTIFICATION ON THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS AND OUT OF THAT LIST SOME OF THE BOOKS OF ACCOUNT WERE IMPOUNDED UNDER SECTION133A(2 )(IA) OF THE INCOME TAX ACT, 1961. F) ALL THE BOOKS OF ACCOUNT, CASH INVENTORY, INVENTORY OF BOOKS OF ACCOUNT WERE DULY SIGNED BY ME, ONE OF THE DIRECTOR OF THE COMPANY. G) I ALSO FURNISHED SUCH INFORMATION / STATEMENT AS TH E SURVEY TEAM REQUIRED UNDER SECTION 133A OF THE INCOME TAX ACT, 1961. 3. THAT THE SURVEY TEAM DID ALL THE WORK AT THE OUR CO MPANYS AURANGABAD FACTORY ONLY. NONE OF THE MEMBERS OF THE SURVEY TEA M PAID PHYSICAL VISIT TO THE OTHER TWO BRANCHES OR OUR COMPANY NAMELY OMARPU R BRANCH AND 16 MILE MALDA BRANCH WHERE STOCKS WERE ALSO HELD AND THEREF ORE NO ACTUAL PHYSICAL INSPECTION OF THESE STOCKS WERE DONE BY THE SURVEY TEAM AT THESE BRANCHES. 4. SINCE THE START OF THE SURVEY OPERATION TILL THE CL OSURE OF THE SAME I, ALAUDDING BISWAS AND ALL THE STAFF MEMBERS OF OUR COMPANY WER E CO-OPERATIVE AND OFFERED ALL ASSISTANCE TO THE SURVEY TEAM. NO DISCR EPANCY IN ANY OF THE ACCOUNTS AND DOCUMENTS WAS DETECTED. NO DOCUMENTS O R VALUABLES WERE RECOVERED FROM PREMISES OF OUR COMPANY WHICH WAS EI THER NOT ENTERED IN THE BOOKS OF THE COMPANY NOR REPRESENTED THE SUPPRESSED INCOME OF THE COMPANY. 5. AFTER TAKING STATEMENT UNDER SECTION133A, THE AUTHO RISED OFFICER INSTRUCTED ME TO DEPOSIT RS. 1 CRORE AS ADVANCE INCOME TAX FOR THE ASSESSMENT YEAR 2010-2011 RELATED TO FINANCIAL YEAR 2009-2010 BY 31 ST MARCH, 2010. ON HEARING THIS INSTRUCTION, SAID I, ALUDDIN BISWAS EX PRESSED OUR COMPANYS INABILITY AND EARNESTLY SUBMITTED THAT OUR COMPANY HAD ALREADY ENHANCED PAYMENT OF ADVANCE INCOME TAX FOR THE AFORESAID ASS ESSMENT YEAR BY MORE THAN 15% AS COMPARED TO THAT OF THE LAST ASSESSMENT YEAR, AS PER INSTRUCTION/REQUEST OF THE DEPARTMENT, THOUGH THERE WAS NO CORRESPONDING INCREASE IN THE PROFIT OF OUR COMPANY; RATHER THERE WAS AN EXPECTATION OF DECREASE IN THE PROFIT OF OUR COMPANY. (PAYMENT OF ADVANCE INCOME TAX, A.Y 2009-10 RS.78,00,000.00 AND A.Y 2010-11 RS.90,1 0,000.00 UPTO 15/03/2010 ) AND OUR COMPANY WOULD NOT BE ABLE TO CARRY OUT TH IS INSTRUCTION S OUR COMPANY HAD NO SUCH HUGE INCOME. 6. ON HEARING THIS SUBMISSION, THE AUTHORISED OFFICER GOT FURIOUS AND THREATENED ME TO DEPOSIT RS. 1 CRORE BY 31/03/2010 AND DROVE M E OUT OF THE ROOM. THIS HAPPENED AT ABOUT 7 P.M. AT ABOUT 9 P.M., THE AUTHO RISED OFFICER CALLED ME AND DIRECTED ME TO SIGN THE ALLEGED STATEMENT CLAIM ED TO HAVE BEEN PREPARED UNDER SECTION 131 OF THE INCOME TAX ACT, 1961. I DE NIED TO SIGN THE STATEMENT AND EARNESTLY PLACED THE QUESTION AS I DID NOT KNOW WHAT WAS WRITTEN IN THE STATEMENT HENCE I WOULD NOT SIGN THE STATEMENT. IT WAS THEN COMMUNICATED THAT, THAT STATEMENT WAS AS SAME AS TAKEN EARLIER B UT ONLY THING ADDITIONALLY WRITTEN THERE WAS A COMMITMENT TO DEPOSIT RS.1 CORE WITHIN 31/03/2010. HEARING THIS I FURTHER EXPRESSED THE OUR COMPANYS INABILITY AND DENIED TO SIGN THE STATEMENT. THIS TRAGEDY WENT ON TILL ABOUT 11 P.M. 7. I CAME TO THE OFFICE/FACTORY AT ABOUT 11.30 A.M AS I GENERALLY COME TO THE FACTORY TAKING BREAK FIRST ONLY. AFTER STARTING OF SURVEY OPERATION I WAS THE WITH THE SURVEY TEAM. I NOT EVEN MOVED FOR TAKING L UNCH SO THAT MY ABSENCE MAY NOT CAUSE ANY HARDSHIP TO THE SURVEY TEAM. I NO T EVEN MOVED TO TAKE INFORMATION OF SITUATION OF MY FATHER, SRI SIDDIQUE BISWAS, AGED ABOUT 84 ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 8 YEARS ( THEN ), WHO IS SUFFERING FROM PROLONG ILLNESS. THE SURVE Y WAS CONTINUING MORE THAN 10 HOURS. ALL THESE CUMULATIVE LY AFFECTED MY MENTAL AND PHYSICAL STRENGTH AND BROKE DOWN. AT ABOUT 11 P.M. I PUT MY SIGNATURE MECHANICALLY WHEREVER THE AUTHORIZED OFFICER DIRECT ED TO GET RID OF THIS MOST PATHETICAL AND HUMILIATING SITUATION. 8. AFTER SIGNING THE ALLEGED STATEMENT CLAIMED TO HAVE BEEN TAKEN UNDER SECTION 131 OF THE INCOME TAX ACT, 1961, THE AUTHORIZED OFF ICER DELIVERED ME TWO NOTICES U/S 131 AFTER SIGNING THEREON AND GRACIOUSL Y SAID THAT HE HAD CONSIDERED MY SUBMISSION AND FOR THIS RS.1 CRORE WO ULD NOT BE REQUIRED TO BE DEPOSITED BY 31/03/2010. ONLY RS.50,00,000.00 WOULD BE REQUIRED TO BE DEPOSITED BY 31/03/2010 AND THEIST AMOUNT OF RS.50, 00,000.00 REQUIRED TO BE DEPOSITED IN TWO INSTALLMENT OF RS.25,00,000 EACH O N 30/04/2010 AND 30/06/2010 RESPECTIVELY AND FOR THIS, TWO CHEQUE OF RS.25,00,000.00 EACH OF AFORESAID DATE REQUIRED TO BE PAID AS SECURITY. THE AUTHORIZED OFFICER ALSO DIRECTED ME TO APPEAR AT INCOME TAX OFFICE, BERHAMP ORE ON THE NEXT DAY WITH THE SAID POST DATED CHEQUE AND ALL OTHER BOOKS OF A CCOUNTS WHICH THEY WERE NOT ABLE TO CARRY WITH THEM. 9. ON 30/04/2010, I APPEARED AT INCOME TAX OFFICE, BER HAMPORE WITH TWO POST DATED CHEQUE OF RS.25,00,000.00 EACH VIDE CHEQUE NO .229038 DATED 30/04/2010 AND CHEQUE NO.229037 DATED 30/06/2010 BO TH WERE DRAWN ON STATE BANK OF INDIA, SSI AURANGABAD BRANCH AND ALSO WITH OTHER BOOKS OF ACCOUNTS. ON THE SAME DAY I ALSO PLACED ADVANCE TAX DEPOSITED CHALLAN OF RS.50,00,000.00(RUPEES FIFTY LACS). 10. ALL THE THINGS, I.E. PLACING OF POST DATED CHEQUE A ND DEPOSIT OF FURTHER ADVANCE TAX OF RS.50,00,000.00 WERE DONE JUST TO KEEP THE C OMMITMENT AND NOT FOR ANYTHING ELSE. 11. IN ORDER TO KNOW, WHAT WAS WRITTEN IN THAT ALLEGED STATEMENT, SIGNATURE ON WHICH WAS TAKEN UNDER DURESS, OUR COMPANY APPLIED F OR CERTIFIED COPIES OF ALL THE DEPOSITION/STATEMENT TAKEN DURING THE SURVEY PA YING FEES FOR CERTIFIED COPY (BSR CODE: 0510308 CH NO.65213 DATED 07/04/2010 RS. 1000.00) ON 07/04/2010. THE AUTHORISED OFFICER WAS ON ADDITIONA L CHARGE DUTY AT BERHAMPORE OFFICE. HE USUALLY PAID A VISIT TO BERHA MPORE ONE DAY IN A WEEK OR ONE OR TWO DAYS IN A FORTNIGHT. I, ALAUDDING BIS WAS AND / OR A/R OF THE COMPANY MET HIM AS AND WHEN HE WAS AVAILABLE AT BER HAMAPRE OFFICE FOR CERTIFIED COPY OF THE ALLEGED STATEMENT CLAIMED TO HAVE TAKEN U/S. 131, SIGNATURE ON WHICH WAS TAKEN UNDER DURESS. BUT EACH AND EVERY TIME, THE AUTHORIZED OFFICER AVOIDED THE ISSUE TAKING DIFFERE NT TYPES OF PLEA NOT IN THIS WEEK, THAT WILL BE AVAILABLE COMING WEEK ETC. ETC. BY THIS TIME APRIL, WAS GOING TO OVER. OUR COMPANY HAD NO OTHER ALTERNATIVE BUT T O DEPOSIT THE COMMITMENT AMOUNT OF RS.25,00,000.00 WHICH WAS DUE ON 30/04/20 10 AND OUR COMPANY DEPOSITED THE SAME ON THE SAME DAY IN ORDER TO KEEP OUR COMMITMENT. 12. ON PAYMENT OF SAID RS.25,00,000.00 ON 30/04/2010, WE INTIMATED THE MATTER TO THE AUTHORIED OFFICER AND PRAYED TO RETURN THE P OST DATED CHEQUE OF RS.25,00,000.00 DATED 30/04/2010 ON 19/05/2010. THI S REQUEST WAS ALSO KEPT UNANSWERED. 13. ON 28/06/2010, WE PRAYED FOR STOP COLLECTION OF RS. 25,00,000.00 WHICH WAS DUE TO BE DEPOSITED ON 30/06/2010, AS ALL THE DEPOS ITS OF TAX WHICH WERE MADE AFTER SURVEY WOULD RESULT HUGE REFUND ONLY WHICH WA S UNWANTED AND FURTHER REQUESTED TO RETURN THE CHEQUE DATED 30/04/2010. BU T NO RESPONSE WAS RECEIVED. ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 9 14. ON 22/09/2010, WE FURTHER PRAYED FOR STOP COLLECTIO N OF REST AMOUNT OF RS.25,00,000.00 STATING DETAILED FACTS OF ITS FINA NCIAL POSITION AND PLACING A CHEQUE OF BLANK AMOUNT AND BLANK DATED ( VIDE NO.430951 ) ISSUED IN FAVOUR OF THE INCOME TAX DEPARTMENT AS PER INSTRUCTION OF THE THEN LD. ACIT, CIRCLE MURSHIDABAD. THE LD. ACIT MURSHIDABAD ULTIMATELY OR DERED FOR STOP COLLECTION OF REST AMOUNT OF RS.25,00,000.00 WHICH WAS DUE TO BE PAID ON 30/06/2010 AGAINST THE ABOVE STATED SECURITY IN THE FORM OF BANK CHEQUE WITH BLANK DATE WITH A COMMITMENT THAT IF AFTER ASSESSME NT, DEMAND ARISES, THAT WILL BE RECOVERED THROUGH THAT CHEQUE. 15. ON 29/09/2010 YOUR ASSESSEE COMPANY FLED THE RETURN OF INCOME FOR ASSESSMENT YEAR 2010-2011 (RELATED TO FINANCIAL YEA R 2009-2010, IN WHICH THE SURVEY WAS CONDUCTED) AND THAT RETURN HAS BEEN SELE CTED FOR SCRUTINY ASSESSMENT. 16. OUR COMPANY FURTHER PRAYED FOR CERTIFIED COPY OF O RDER SHEET, ALLEGED DEPOSITION CLAIMED TO HAVE TAKEN U/S. 131 SIGNATURE ON WHICH WAS TAKEN UNDER DURESS, DEPOSITION UNDER SECTION 133A ETC BY FURTHE R DEPOSITING FEES OF RS2000.00 ( VIDE CH. NO.51961 BSR. CODE NO.0510308 DATED 01/03/ 2012 ) AND ON 14/03/2012 YOUR ASSESSEE COMPANY HAS RECEIVE D THE CERTIFIED COPY OF THE ABOVE STATED DOCUMENTS AND COME TO KNOW THE MAT ERIALS OF THE DEPOSITION CLAIMED TO HAVE TAKEN UNDER SECTION 121 OF THE INCO ME TAX ACT, 1961, SIGNATURE ON WHICH WAS TAKEN UNDER DURESS, IS FULL OF FACTS AND FIGURES WHICH ARE NOT TRUE. 17. I AM SWEARING THIS AFFIDAVIT TO CONFIRM THE ABOVE S TATED FACTS. VERIFICATION THAT THE ABOVE STATED PARTICULARS ARE TRUE TO THE B EST OF MY KNOWLEDGE AND BELIEF. READ OVER AND EXPLAINED IN VERNACULAR TO ALAUDDIN B ISWAS. SD/ - ADTITYA MOHAN RAY HOWEVER, AO DISREGARDED THE SUBMISSION OF THE ASSES SEE BY OBSERVING AS UNDER:- 1) IT IS THE DISCRETION OF THE REVENUE TO IDENTIFY THE PLACES FOR THE PURPOSE OF SURVEY. IF THE SURVEY TEAM DID NOT VISIT TO THE BRA NCHES OF ASSESSEE THAT DOES NOT MEAN THE SURVEY PROCEEDINGS WOULD BE IGNORED. 2) DURING THE SURVEY PROCEEDINGS NO COERCION OF WHATSO EVER WAS APPLIED UPON THE ASSESSEE RATHER THE ASSESSEE WAS SATISFIED WITH THE VALUATION OF THE INVENTORY MADE DURING THE PROCEEDINGS 3) THE RETRACTION STATEMENT WAS FILED BY ASSESSEE AFTE R ALMOST THREE YEARS. THEREFORE THE SAME CANNOT BE ACCEPTED. 4) THE ASSESSEE AT HIS OWN HAS OFFERED THE TAX OF 1 CRORE ON ACCOUNT OF UNDER VALUATION OF CLOSING STOCK AND THEREFORE HE ACCORDI NGLY MADE THE PAYMENT OF 75 LAKH TOWARDS TAX. ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 10 IN VIEW OF ABOVE, THE AO DISREGARDED THE CONTENTION OF THE ASSESSEE AND TREATED THE SUPPRESSED STOCK OF 3,06,28,425/- AS UNEXPLAINED INVESTMENT U/S. 69C OF THE ACT. 5. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE L D. CIT(A). BEFORE LD. CIT(A) ASSESSEE HAS MADE SEVERAL SUBMISSION AS DETAILED UN DER:- I) THE STATEMENT WAS RECORDED U/S.131 / 133A OF THE ACT UNDER DURESS AND THEREFORE IT WAS NOT CONFESSED THAT THERE IS UNDER VALUATION OF CLOSING STOCK; II) THE QUESTION NO. 5 OF THE STATEMENT TAKEN U/S. 131 OF THE ACT SAYS THAT THE PHYSICAL STOCK WAS TAKEN IN THE PRESENCE OF EMPLOYE E BUT IT IS CLEAR FROM THE STATEMENT THAT THERE IS NO SIGNATURE OF ANY EMPLOYE E THEREIN. III) THE ASSESSEE IMMEDIATELY AFTER THE SURVEY APPL IED FOR CERTIFIED COPY OF THE STATEMENT TAKEN U/S. 133A/131 OF THE ACT. HOWEVER I T WAS SERVED ON 14.03.2012 AFTER A GAP OF ALMOST TWO YEARS. THUS, T HERE WAS DELAY IN FILING THE RETRACTION STATEMENT. IV) THE ASSESSEE IMMEDIATELY AFTER THE RECEIPT OF T HE STATEMENT SUBMITTED A LETTER DATED 27.03.2012 NARRATING THE FACT THAT THE STATEMENT WAS OBTAINED UNDER COERCION. THE ASSESSEE ALSO SUBMITTED THAT EVEN DUR ING ASSESSMENT PROCEEDINGS IT WAS DENIED THAT THE ASSESSEE HAS ACCEPTED IN HIS STATEMENT U/S. 131 OF THE ACT THAT THERE WAS UNDER VALUATION OF CLOSING STOCK. TH E DELAY IN FILING THE RETRACTION STATEMENT OCCURRED DUE TO THE FACT THAT THE REVENUE DID NOT PROVIDE THE CERTIFIED COPY OF THE STATEMENT. V) THE SURVEY TEAM DID NOT VISIT TO OTHER BRANCHES OF ASSESSEE AND THEREFORE THE PHYSICAL STOCK OF THOSE BRANCHES CANNOT BE RELIED U PON. THE PHYSICAL STOCK STATEMENT WAS NEITHER SIGNED BY ANY STORE KEEPER NO R IT WAS PREPARED IN PRESENCE OF ANY PERSON. THEREFORE, THE VALUATION OF ALLEGED SUPPRESSED STOCK IS WITHOUT ANY BASIS. VI) THE ASSESSEE IN ITS STATEMENT U/S. 131 OF THE A CT HAS CLEARLY STATED IN QUESTION NO.5 THAT HE IS NOT SURE WITH THE DIFFEREN CE OF THE STOCK TAKEN BY THE SURVEY TEAM VIS-A-VIS STOCK REGISTER. THE DIRECTOR OF THE ASSESSEE-COMPANY FULLY CO-OPERATED DURING SURVEY PROCEEDINGS AND PRODUCED ALL THE NECESSARY BOOKS OF ACCOUNT INCLUDING THE STOCK REGISTER TO THE SURVEY TEAM BUT NO DEFECT OF WHATSOEVER HAS BEEN POINTED OUT BY THEM. THE STATEM ENT TAKEN U/S. 133A OF THE ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 11 ACT DOES NOT ALLEGE ANY SUPPRESSION OF STOCK. AFTER CONSIDERING THE SUBMISSION OF ASSESSEE LD. CIT(A) CONFIRMED THE ORDER OF AO BY OBSERVING AS UNDER:- 7.0 APPELLANTS SUBMISSION AND FACTS AVAILABLE ON R ECORD IS CAREFULLY CONSIDERED. THE REMAND REPORT SUBMITTED BY AO AND T HE REPLY GIVEN BY APPELLANT IS TAKEN INTO CONSIDERATION. THE SURVEY F OLDER WAS CALLED FOR AND VERIFIED. AS IS EVIDENT FROM THE STATEMENT RECORDED U/S 131 OF THE IT ACT, THE FACT OF EXCESS STOCK IN TENDU LEAVES, TOBACCO & BIR I WAS CONFRONTED TO MR. ALLAUDDIN BISWAS AFTER WORKING OUT TO DIFFERENCE BO TH IN QUANTITY AND MONETARY TERMS AS PER THE RATE ASCERTAINED DURING T HE CURSE OF SURVEY. THERE IS NO EVIDENCE ON RECORD TO ACCEPT THE APPELLANTS VIEW WHAT NO SURVEY HAD TAKEN PLACE IN TWO FACTORY PREMISES NAMELY MALDA & OMARPORE, AND THE FIGURES AS AVAILABLE IN THE SURVEY FOLDER ARE IMAGI NARY FIGURES. THE AO HAD NOT MAKE THE ADDITION MERELY BASED ON STATEMENT REC ORDED, BUT ON THE BASIS OF STOCK TAKING DONE DURING THE COURSE OF SURVEY AS IS EVIDENT FROM SURVEY FOLDER AND THE STATEMENT ITSELF, WHERE THE QUANTITY OF TEN DU LEAVES, TOBACCO, BIRI FOUND HAS BEEN RECORDED. THE ALLEGATIONS MADE BY APPELLAN T DURING THE COURSE OF ASSESSMENT AND APPELLATE PROCEEDINGS ARE CLEARLY AN AFTERTHOUGHT TO ESCAPE THE RIGORS OF TAX PAYMENT. THE INFORMATION FOR MAKI NG ADDITION WAS FUND DURING THE CURSE OF SURVEY IN THE FORM OF EXCESS ST OCK. THE APPELLANT HAS NOT BEEN ABLE TO REBUT THE ABOVE FINDING OTHER THAN CHA LLENGING THE VERY PROCESS OF SURVEY AND ALLEGING THAT THE FIGURES ARE AVAILABLE WERE WRONG AND FABRICATED. IN VIEW OF THE ABOVE IT IS HELD THAT THE AO HAD COR RECTLY ADDED THE EXCESS STOCK FOUND DURING THE COURSE OF INVESTMENT U/S. 69 OF TH E IT ACT. THE APPEAL MADE ON THIS GROUND IS DISMISSED. BEING AGGRIEVED BY THIS ORDER OF LD. CIT(A) ASSESSE E CAME IN SECOND APPEAL BEFORE US. 6. BEFORE US LD. AR REITERATED THE SAME ARGUMENTS THAT WERE MADE BEFORE LD. CIT(A) AND HE STATED THAT THE ISSUE MAY BE DECIDED ON MERIT. ON THE OTHER HAND, LD. DR HEAVILY RELIED ON THE ORD ER OF AUTHORITIES BELOW. 7. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE A SURVEY WAS CONDUCTED AT THE FACTORY PREMISES OF AURANGABAD ON 29.03.2010. DURING THE CO URSE OF SURVEY, PHYSICAL STOCK WAS INVENTORIED WHICH WAS COMPARED WITH THE STOCK M AINTAINED IN THE BOOKS OF ACCOUNT. THE AO FOUND THE DIFFERENCE BETWEEN THE PH YSICAL STOCK RECORDED IN THE BOOKS OF ACCOUNT FOR 3,06,28,425/-ONLY. ACCORDINGLY, THE AO RECORDED THE STATEMENT OF THE ASSESSEE U/S 131 / 133A WHEREIN THE ASSESSEE ADMITTED THE SUPPRESSION / UNDER VALUE OF CLOSING STOCK AND AGREED FOR THE ADDITION OF THE IMPUGNED AMOUNT. HOWEVER, THE ASSESSEE DID NOT OFFER THE AMOUNT OF SUPPRESSED STOCK AS INCOME IN ITS RETURN FILED ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 12 U/S. 139(1) OF THE ACT. THEREFORE, AO MADE THE ADDI TION TO THE TOTAL INCOME OF THE ASSESSEE ON THE BASIS OF DISCREPANCY OBSERVED IN TH E STOCK AS DISCUSSED ABOVE. THE VIEW TAKEN BY THE AO WAS SUBSEQUENTLY CONFIRMED BY LD. CIT(A). HOWEVER, WE FIND THAT THE ORDERS OF AUTHORITIES BELOW SUFFER FROM SE VERAL INFIRMITIES AS DETAILED UNDER:- A) THE SURVEY TEAM HAS NOT VISITED TO THE OTHER BRA NCHES OF ASSESSEE AS DISCUSSED ABOVE. THEREFORE, THE INFORMATION ABOUT T HE AVAILABILITY OF PHYSICAL STOCK ON THE DATE OF SURVEY COLLECTED BY REVENUE DU RING THE SURVEY PROCEEDINGS CANNOT BE RELIED. IT IS BECAUSE THE REVENUE FAILED TO DISCHARGE THE DUTY AS IT DID NOT VISIT TO THE OTHER BRANCHES OF ASSESSEE TO FIND OUT THE DISCREPANCY BETWEEN THE PHYSICAL STOCK AS WELL AS STOCK DECLARED IN THE BOOKS OF ACCOUNT. THEREFORE, THE DIFFERENCE IN STOCK RECORDED BY REVENUE IS NOT RELIABLE; B) THE ADDITION HAS BEEN MADE ON THE BASIS OF STATE MENT RECORDED U/S. 131 OF THE ACT AND RELEVANT CONTENTS OF THE STATEMENT HAS ALREADY BEEN DISCUSSED IN THE PRECEDING PARAGRAPH OF THIS ORDER, THEREFORE, SAME ARE NOT REPRODUCED HERE FOR THE SAKE OF BREVITY. HOWEVER IN THIS REGARD, WE FIND THAT NOTICE DURING SURVEY PROCEEDINGS CANNOT BE ISSUED U/S 131 OF THE ACT OTHER THAN THE SITUATI ON CONTAINED U/S 133A(6) OF THE ACT. THE RELEVANT EXTRACT OF CLAUSE (6) TO SECT ION 133A OF THE ACT READS AS UNDER:- (6) IF A PERSON UNDER THIS SECTION IS REQUIRED TO A FFORD FACILITY TO THE INCOME-TAX AUTHORITY TO INSPECT BOOKS OF ACCOUNT OR OTHER DOCU MENTS OR TO CHECK OR VERIFY ANY CASH, STOCK OR OTHER VALUABLE ARTICLE OR THING OR T O FURNISH ANY INFORMATION OR TO HAVE HIS STATEMENT RECORDED EITHER REFUSES OR EVADES TO DO SO, THE INCOME-TAX AUTHORITY SHALL HAVE ALL THE POWERS UNDER 88 [SUB-SECTION (1) OF SECTION 131 ] FOR ENFORCING COMPLIANCE WITH THE REQUIREMENT MADE FROM THE ABOVE PROVISION IT IS CLEAR THAT THAT THE STATEMENT U/S 131 OF THE ACT CAN BE RECORDED ONLY UNDER COMPELLING CIRCUMSTANCES SUGGES TING THAT THERE WAS NON- COOPERATION FROM THE SIDE OF ASSESSEE OR THE ASSESS EE HAS REFUSED TO FURNISH THE DESIRED INFORMATION. WE RATHER FIND FROM THE SUBMISSION OF THE ASSESSEE THAT NECESSARY CO- OPERATION WAS EXTENDED TO THE SURVEY TEAM AT THE TI ME OF SURVEY PROCEEDINGS AS EVIDENT FROM THE STATEMENT OF THE ASSESSEE BEFORE T HE AO. THE RELEVANT EXTRACT OF THE SAID SUBMISSION OF ASSESSEE IS REPRODUCED BELOW:- ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 13 A) YOUR ASSESSEE AFFORDED EVERY FACILITY TO THE INC OME TAX AUTHORITY TO INSPECT ITS BOOKS OF ACCOUNTS, OTHER DOCUMENTS AS REQUISITIONED . ALL THE BOOKS OF ACCOUNTS THAT ARE MAINTAINED WERE PRODUCED BEFORE THE AUTHORITY F OR THE PURPOSE OF THE INSPECTION. THE SURVEY TEAM DULY INSPECTED THE BOOKS OF ACCOUNT S, OTHER DOCUMENTS AS THEY REQUIRED AND MADE OR CAUSED TO BE MADE EXTRACTS OR COPIES THERE FROM. B) DURING THE INSPECTION, THE SURVEY TEAM ALSO DIRE CTED YOUR ASSESSEE TO PRODUCED BIRI STOCK BOOK, LEAVES STOCK REGISTER AND TOBACCO STOCK REGISTER OF OTHER TWO MANUFACTURING UNIT/ BRANCHES NAMELY OMARPUR BRANCH AND16 MILE MALDA BRANCH OF THE COMPANY FOR THE PURPOSE OF THEIR INSPECTION. AC CORDING TO THE DIRECTION OF THE SURVEY TEAM, YOUR ASSESSEE BROUGHT THOSE BOOKS FROM THOSE BRANCHES AND PRODUCED THOSE BOOKS FOR THE PURPOSE OF INSPECTION OF THE SU RVEY TEAM. HOWEVER NONE OF THE SURVEY TEAM MEMBERS PHYSICALLY VISITED THOSE BRANCH ES. C) YOUR ASSESSEE ALSO AFFORDED THEM THE NECESSARY F ACILITY TO CHECK AND VERIFY THE CASH STOCK OF RAW MATERIALS AND FINISHED GOODS AND OTHER VALUABLE ARTICLES OR THINGS WHICH WERE FOUND IN THE COMPANYS AURANGABAD FACTORY. THEREFORE, WE HOLD THAT REVENUE HAS NO JURISDICTION TO RESORT THE POWERS UNDER SUB- SECTION (1) & (2) OF SECTION 131 OF THE ACT WHILE S URVEYING THE ACCOUNTS OF ASSESSEE U/S. 133A OF THE ACT. IT IS BECAUSE, IN THE INSTANT CASE THE ASSESSEE NEITHER REFUSED NOR EVADED WITH THE COMPETENT AUTHORITY. IN THIS REGARD , WE FIND SUPPORT AND GUIDANCE FROM THE HON'BLE JURISDICTIONAL HIGH COURT IN THE C ASE OF DR. VIJAY PAHWA VS. DCIT REPORTED IN 250 ITR 354 (CAL) WHEREIN THE RELEVANT EXTRACT OF THE JUDGMENT IS REPRODUCED BELOW:- SUMMONS CAN BE SERVED UNDER SECTION 131(1) ONLY IN CASE OF OBSTRUCTION BY THE PERSON CONCERNED OR WHEN SOME SORT OF HINDRANCE IS PUT UP BY HIM. IN THE INSTANT CASE THE SUMMONS WAS IMMEDIATELY EXECUTED ON THE SAME DA Y WITHIN 30 MINUTES OR SO. THERE ARE OTHER POWERS FOR SEARCH AND SEIZURE. THER E ARE OTHER POWERS FOR REOPENING OF COMPUTED ASSESSMENTS. THESE WERE NOT UTILIZED. U NDER THE GARB OF CONDUCTING A SIMPLE SURVEY UNDER SECTION 133A, BOOKS WERE SEIZED WITHOUT ANY APPARENT AUTHORITY. THE ITOS AND AUTHORITIES DO NOT HAVE ANY POWER TO I NTERRUPT THE ORDINARY PEACEFUL CITIZENS OF THE COUNTRY IN ANY MANNER THEY LIKE BY UTILIZING THE LARGE POWERS GIVEN TO THEM, WITHOUT KEEPING STRICTLY WITHIN THE FOUR CORN ERS OF THOSE LARGE POWERS. SINCE THE POWERS VESTED ARE LARGE, EVEN A MILLIMETRE OF DEPAR TURE THEREFROM MUST BE IMMEDIATELY SHORN OFF BY THE IMPARTIAL COURTS OF LA W IF THIS COUNTRY IS TO CONTINUE TO REMAIN A FREE ONE. IN THE INSTANT CASE, THERE WAS N O OBSTRUCTION PUT BY THE PETITIONER OR ANY FACILITY WITHHELD BY HIM FROM ALLOWING A SUR VEY TO BE MADE. THERE WAS NO PENDING ADJUDICATION WHERE THE SUMMONING POWER COUL D BE USED AT ALL. IN ANY EVENT, SUMMONS COULD NOT BE ISSUED FOR PRODUCTION ON THE S AME DAY AND THE BOOKS INSTANTANEOUSLY IMPOUNDED. THUS, THE ACTION OF THE INCOME-TAX AUTHORITIES WAS NOT JUSTIFIED. IT WAS FURTHER OBSERVED THAT THE STATEMENT WAS ALSO RECORDED U/S 133A OF THE ACT BUT THERE WAS NO WHISPER ABOUT THE SUPPRESSION OF PHYSI CAL STOCK AS ALLEGED BY THE AO IN ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 14 THE STATEMENT RECORDED U/S. 131 OF THE ACT DATED 29 .03.2010 WHICH IS REPRODUCED BELOW:- STATEMENT OF SHRI ALAUDDIN BISWAS S/O SIDDIQUE BISW AS DIRECTOR OF M/S KALPANA BIRI MANUFACTURING CO (PVT) LTD. AT COLLEGE PARA, P.O. A URANGABAD, DIST. MURSHIDABAD, RECORDED AT THE BUSINESS PREMISES DURING THE COURSE OF SURVEY U/S 133A ON 29.03.2010 I DO SWORN IN THE NAME OF GOD WHATEVER I SHALL SPEA K OR STATE BEFORE THE INCOME TAX DEPARTMENT, THE WHOLE IS TRUTH AND NOTHING BUT THE TRUTH. OATH GIVEN BY OATH TAKEN BY SD/ ALAUDDIN BISWAS 29/03/10 SD/- ILLEGIBLE 29/03/10 Q.NO. 1: PLEASE IDENTIFY YOURSELF? A. 1: I AM SRI ALAUDDIN BISWAS S/O SIDDIQUE BISWAS, DIRECTOR OF M/S KALPANA BIRI MANUFACTURING CO.(PVT) LTD, RESIDING AT COLLEGEPARA , P.O. AURANGABAD DT. MSD. AGED ABOUT 46 YEARS. Q. NO.2: GIVE THE DETAILS OF BRANCHES AND OTHER MAN UFACTURING UNIT ARE MAINTAINED BY YOU? A.2: WE HAVE TWO MANUFACTURING UNIT / BRANCHES MAI NLY (1) AT BAISNABNAGAR, MALDA (2) AT UMARPUR, GHORSALA, MURSHIDABAD AND HEAD OFFI CE AT AURANGABAD, WHICH IS ALSO A MANUFACTURING UNIT. Q. NO.3: GIVE THE ADDRESS OF THE SALES UNIT OF THIS COMPANY? A. 3: WE HAVE TWO SALE UNITS (1) AT PANDUA, KALNA ROAD, HOOGHLY (2) AT 1/32, L.P MAIN VIKASH MARG, LAXMI NAGAR, DELHI-92 Q. NO.4: ON YOUR ACCOUNTS IT IS SEEN THAT THERE IS TWO DIVISIONS NAMED (1) KBM ELECTRONICS & (2) KALPANA DIGITAL WORLD EXIST, WHAT ARE THE LEGAL PROVISION AND BUSINESS OF THESE UNITS? A.4: THESE ARE THE SISTER CONCERN OF M/S KALPANA BI RI MFG. CO. (PVT) LTD. AND PROFIT OF THOSE UNITS ARE MERGED WITH THE PROFIT OF THE CO MPANY. BOTH THE UNITS ARE CARRYING ON ELECTRONICS BUSINESS. Q.NO.5 WHAT ARE THE BOOKS OF ACCOUNTS ARE MAINTAINE D BY YOU? A.: CASH BOOK, LEDGER, STOCK REGISTERS OF ALL RAW MATERIALS, SALES REGISTER, PRODUCTION REGISTER ETC. ARE MAINTAINED MANUALLY. Q.NO.6: GIVE THE DETAILS OF CASH IN HAND AND BANK B ALANCE? A.6: CASH IN HAND WOULD BE APPROX. 15 LAKHS AND OD BALANCE APPROX. 2 CRORES. Q.NO.7 EXPLAIN THE MODUS OF OPERENDI OF YOUR BUSINE SS AND LABOUR PAYMENTS? A.7: RAW MATERIALS ARE PURCHASED DIRECTLY FROM MARK ETS, DISTRIBUTED THROUGH MEDIUM OF MUNSHI AMONGST THE HOME WORKERS WHO ARE DIRECTLY ENGAGED BY THE COMPANY. WE DEDUCT THE TDS FROM THE PAYMENT TO MUNSHIS, WE ALSO REGULARLY DEDUCT THE PF FROM THE PAYMENTS OF HOME WORKERS. AT THIS TIME TOTAL LABOUR WORKING IN THREE UNITS AR E 12746. THE RATE OF THE LABOUR WAGES ARE FOLLOWING:- UNIT RATE / THOUSAND STICKS UMARPUR RS.46/- AURANGABAD RS.46/- MALDA RS.45.80/- Q.8: DO YOU WANT TO ADD OR ALTER THE STATEMENT MADE ABOVE. ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 15 A.8: NO, SIR, THANK YOU, THE ABOVE STATEMENT GIVEN BY ME TO THE BEST OF MY K NOWLEDGE AND BELIEF, WITHOUT ANY FORCE OR COERCION AND SOUND MIND. SD/- ALAUDDIN BISWAS SD /- ILLEGIBLE 29/03/10 29/3/10 7.1 FROM THE ABOVE STATEMENT RECORDED U/S. 133A OF THE ACT WE FIND THAT NO ALLEGATION OF SUPPRESSION OF PHYSICAL STOCK HAS BEE N CHARGED AGAINST THE ASSESSEE. WE ALSO FIND THAT THE ADDITION HAS BEEN MADE AND SUSTA INED BY LD. CIT(A) MERELY ON THE BASIS OF STATEMENT RECORDED DURING SURVEY PROCEEDIN GS AND REVENUE HAS NOT POINTED OUT ANY DEFECT IN THE BOOKS OF ACCOUNT / STOCK REGI STER MAINTAINED BY ASSESSEE SUGGESTING THAT ASSESSEE HAS SUPPRESSED THE STOCK. IN THE ABSENCE OF ANY DOCUMENTARY EVIDENCE, THE ADDITION CANNOT STAND MERELY ON THE B ASIS OF STATEMENT RECORDED DURING SURVEY PROCEEDINGS. IN THIS REGARD, WE FIND THAT CB DT HAS ISSUED VIDE INSTRUCTION ISSUED VIDE F. NO. 286/98/2013-IT(INV.II) DATED 18 TH OF DECEMBER 2014 WHICH READS AS UNDER:- INSTANCES/COMPLAINTS OF UNDUE INFLUENCE/COERCION HA VE COME TO NOTICE OF THE CBDT THAT SOME ASSESSEES WERE COERCED TO ADMIT UNDISCLOS ED INCOME DURING SEARCHES/SURVEYS CONDUCTED BY THE DEPARTMENT. IT IS ALSO SEEN THAT MANY SUCH ADMISSIONS ARE RETRACTED IN THE SUBSEQUENT PROCEEDI NGS SINCE THE SAME ARE NOT BACKED BY CREDIBLE EVIDENCE. SUCH ACTIONS DEFEAT THE VERY PURPOSE OF SEARCH/SURVEY OPERATIONS AS THEY FAIL TO BRING THE UNDISCLOSED IN COME TO TAX IN A SUSTAINABLE MANNER LEAVE ALONE LEVY OF PENALTY OR LAUNCHING OF PROSECU TION. FURTHER, SUCH ACTIONS SHOW THE DEPARTMENT AS A WHOLE AND OFFICERS CONCERNED IN POOR LIGHT. 2. I AM FURTHER DIRECTED TO INVITE YOUR ATTENTION T O THE INSTRUCTIONS/GUIDELINES ISSUED BY CBDT FROM TIME TO TIME, AS REFERRED ABOVE, THROU GH WHICH THE BOARDS HAS EMPHASIZED UPON THE NEED TO FOCUS ON GATHERING EVID ENCES DURING SEARCH/SURVEY AND TO STRICTLY AVOID OBTAINING ADMISSION OF UNDISCLOSED INCOME UNDER COERCION/UNDUE INFLUENCE. 3. IN VIEW OF THE ABOVE, WHILE REITERATING THE AFOR ESAID GUIDELINES OF THE BOARD, I AM DIRECTED TO CONVEY THAT ANY INSTANCE OF UNDUE INFLU ENCE/COERCION IN THE RECORDING OF THE STATEMENT DURING SEARCH/SURVEY/OTHER PROCEEDING UNDER THE IT ACT, 1961 AND/OR RECORDING A DISCLOSURE OF UNDISCLOSED INCOME UNDER UNDUE PRESSURE/COERCION SHALL BE VIEWED BY THE BOARD ADVERSELY. FROM THE ABOVE CIRCULAR IT IS AMPLY CLEAR THAT THE CBDT HAS EMPHASIZED TO ITS OFFICERS TO FOCUS ON GATHERING EVIDENCES DURING SEARCH/SURVE Y OPERATIONS AND STRICTLY DIRECTED TO AVOID OBTAINING ADMISSION OF UNDISCLOSED INCOME UNDER COERCION/ UNDUE INFLUENCE. KEEPING IN VIEW THE GUIDELINES ISSUED BY THE CBDT F ROM TIME TO TIME REGARDING THE ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 16 STATEMENTS OBTAINED DURING SEARCH AND SURVEY OPERAT ION, IT IS UNDISPUTEDLY CLEAR THAT THE LOWER AUTHORITIES HAVE NOT COLLECTED ANY OTHER EVIDENCE TO PROVE THE IMPUGNED UNDER VALUATION OF STOCK OTHER THAN THE STATEMENT. THEREFORE UNDER SUCH FACTS & CIRCUMSTANCES WE ARE INCLINED TO REVERSE THE ORDER OF AUTHORITIES BELOW. 7.2 WE ALSO NOTE THAT HAD THERE BEEN ANY DIFFERENCE BETWEEN PHYSICAL STOCK AND STOCK DECLARED IN THE BOOKS OF ASSESSEE THEN AO SHO ULD HAVE REJECTED THE BOOKS OF ACCOUNT BY INVOKING THE PROVISION OF SECTION 145(3) OF THE ACT. IT IS BECAUSE THE BOOKS OF ACCOUNTS IN SUCH A SITUATION CANNOT BE RELIED UP ON. HOWEVER, THE AO FAILED TO DO SO. IN THE ABSENCE OF ANY DEFECT POINTED OUT BY THE REVENUE IN THE BOOKS OF ACCOUNT OF ASSESSEE, THE ADDITION ON THE BASIS OF STATEMENT CA NNOT BE SUSTAINED. ACCORDING TO THE AO, THE STATEMENT HAS BEEN RETRACTED BY ASSESSEE AF TER A PERIOD OF THREE YEARS IS NOT TRUE AS EVIDENT FROM THE APPLICATION MADE BY THE AS SESSEE IN APRIL, 2010 FOR CERTIFIED COPY OF THE STATEMENT OBTAINED DURING SURVEY PROCEE DINGS. BUT THE REVENUE FAILED TO PROVIDE THE COPIES OF THE SURVEY STATEMENT AS RECOR DED DURING SURVEY PROCEEDINGS IN TIME. IN FACT, THE REVENUE PROVIDED THE COPY OF SUR VEY STATEMENT TO THE ASSESSEE IN MARCH, 2012 AND IMMEDIATELY THEREAFTER THE ASSESSEE FILED THE RETRACTION STATEMENT IN THE MONTH OF MARCH, 2012 ONLY. THUS, THE ALLEGATION THAT STATEMENT WAS RETRACTED AFTER A PERIOD OF THREE YEARS DOES NOT HOLD GOOD. THE ASS ESSEE HAS ALSO FILED IN SUPPORT OF ITS CLAIM AN AFFIDAVIT VIDE DATED 30.01.2013 WHICH READS AS UNDER :- XXXXXXXXXXXX 11. IN ORDER TO KNOW, WHAT WAS WRITTEN IN THAT ALLE GED STATEMENT, SIGNATURE ON WHICH WAS TAKEN UNDER DURESS, OUR COMPANY APPLIED FOR CER TIFIED COPIES OF ALL THE DEPOSITION/STATEMENT TAKEN DURING THE SURVEY PAYING FEES FOR CERTIFIED COPY (BSR CODE:0510308 CH NO.65213 DATED 07/04/2010 RS.1000.0 0) ON 07/04/2010. THE AUTHORISED OFFICER WAS ON ADDITIONAL CHARGE DUTY AT BERHAMPORE OFFICE. HE USUALLY PAID A VISIT TO BERHAMPORE ONE DAY IN A WEEK OR ONE OR TWO DAYS IN A FORTNIGHT, I, ALAUDDING BISWAS AND/OR A/R OF THE COMPANY MET HIM AS AND WHEN HE WAS AVAILABLE AT BERHMPRE OFFICE FOR CERTIFIED COPY OF THE ALLEGE D STATEMENT CLAIM TO HAVE TAKEN U/S. 131, SIGNATURE ON WHICH WAS TAKEN UNDER DURESS. BUT EACH AND EVERY TIME, THE AUTHORIZED OFFICER AVOIDED THE ISSUE TAKING DIFFERE NT TYPES OF PLEA, NOT IN THIS WEEK, THAT WILL BE AVAILABLE COMING WEEK ETC. ETC. BY THI S TIME APRIL, WAS GOING TO OVER. XXXXXXXXXXXXX 16. OUR COMPANY FURTHER PRAYED FOR CERTIFIED COPY O F ORDER SHEET, ALLEGED DEPOSITION CLAIMED TO HAVE TAKEN U/S.131 SIGNATURE EON WHICH W AS TAKEN UNDER DURESS, DEPOSITION UNDER SECTION133A ETC BY FURTHER DEPOSITING FESS OF R.2000.00 (VIDE CH NO.51961 BSR. CODE NO.0510308 DATED 01/03/202) AND ON 14/03/ 2012 YOUR ASSESSEE COMPANY ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 17 HAS RECEIVED THE CERTIFIED COPY OF THE ABOVE STATED DOCUMENTS AND COME TO KNOW THE MATERIALS OF THE DEPOSITION CLAIMED TO HAVE TAKEN U NDER SECTION 131 OF THE INCOME TAX ACT, 1961, SIGNATURE ON WHICH WAS TAKEN UNDER DURES S, IS FULL OF FACTS AND FIGURES WHICH ARE NOT TRUE. XXXXX 7.3 IT WAS ALSO OBSERVED THAT THE CBDT VIDE FILE NO .414/105/2008-IT-(INV1) HAS DIRECTED TO ITS OFFICERS TO RECORD THE PROCEEDINGS DURING SURVEY IN SPECIFIED FORMAT. THE RELEVANT FORMAT FOR RECORDING INVENTORY IS REPR ODUCED BELOW:- V INVENTORY OF STOCKS FOUND DURING THE COURSE OF SU RVEY CARRIED OUT ON (DATE OF SURVEY) IN THE CASE OF M/S _________________ AT (ADDRESS) _ _______ STOCK WAS FOUND AS UNDER: S NO. DESCRIPTION QUANTITY (IN NOS./WT.) VALUE (IN R S) BASIS OF VALUATION REMARKS HOWEVER, FROM THE SURVEY PROCEEDINGS, WE FIND THAT PRESCRIBED FORMAT HAS NOT BEEN USED BY THE SURVEY TEAM. THEREFORE, THE INFORMATION GATHERED DURING SURVEY PROCEEDINGS CANNOT BE RELIED UPON. 7.4 SIMPLY THE TAX PAID BY ASSESSEE DURING SURVEY P ROCEEDINGS DOES NOT MEAN THAT ASSESSEE HAS ADMITTED UNDISCLOSED INCOME. IN OUR CO NSIDERED VIEW, FOR FINDING OUT THE UNDISCLOSED INCOME OF ASSESSEE THERE HAD TO BE TANG IBLE MATERIALS AVAILABLE ON RECORD WHICH IN THE INSTANT CASE ARE MISSING. 7.5 WE ALSO FIND THAT THE STATEMENT RECORDED DURING THE SURVEY PROCEEDINGS U/S. 131 OF THE ACT DOES NOT HAVE ANY EVIDENTIARY VALUE. THE REFORE, THE SAME CANNOT BE USED AS A BASIS FOR MAKING SUCH ADDITION. IN THIS REGARD, T HE DECISION OF THE HONOURABLE MADRAS HIGH COURT IN THE CASE OF S.KHADER KHAN (2008) 300 ITR 157 (MAD) ASSUMES SIGNIFICANCE, WHEREIN IT WAS HELD THAT :- AN ADMISSION IS AN EXTREMELY IMPORTANT PIECE OF EVI DENCE , BUT IT CANNOT BE SAID THAT IT IS CONCLUSIVE AND IT IS OPEN TO THE PERSON , WHO MADE IT, TO SHOW IT HAS INCORRECTLY BEEN MADE AND THE PERSON, MAKING THE STATEMENT SHOU LD BE GIVEN PROPER OPPORTUNITY TO SHOW THAT IT DOES NOT SHOW THE CORRECT STATE OF FACTS. THE MATERIALS FOUND IN THE COURSE OF SURVEY COULD N OT BE THE BASIS FOR MAKING ANY ADDITION IN THE ASSESSMENT. THE WORD MAY USED IN SECTION 133A(3)(III) MAKES IT ITA NO.1020/KOL/2014 A.Y. 2010-11 M/S KALPANA BIRI MFG. CO.PVT. LTD. VS. ACIT, CIR-MSD. PA GE 18 CLEAR THAT THE MATERIAL COLLECTED AND STATEMENT REC ORDED DURING THE SURVEY U/S 133A ARE NOT CONCLUSIVE PIECE OF EVIDENCES BY ITSELF. 8. THE AFORESAID DECISION WAS AFFIRMED BY THE HON'B LE SUPREME COURT IN THE CASE OF CIT , SALEM VS S.KHADER KHAN IN CIVIL APPEAL NO. 13224 OF 2008 & 6747 OF 2012 DATED 20.9.2012, WHEREIN THEIR LORDSHIPS OF SUPREME COURT HELD AS UNDER:- HEARD COUNSEL ON BOTH THE SIDES. LEAVE GRANTED. THE CIVIL APPEAL FILED BY THE DEPARTMENT PERTAINS T O ASSESSMENT YEAR 2001-02. IN VIEW OF THE CONCURRENT FINDINGS OF FACT, THIS CI VIL APPEAL IS DISMISSED. AFTER CONSIDERING THE TOTALITY OF THE FACT AS DISCU SSED ABOVE WE CONCLUDE THAT THERE WAS NO SUPPRESSION OF STOCK ON THE PART OF ASSESSEE . THEREFORE, THE ADDITION MADE BY SURVEY PARTY DURING SURVEY PROCEEDINGS CANNOT BE SU BJECT-MATTER OF ADDITION. HENCE, WE HAVE NO HESITATION TO REVERSE THE ORDER OF AUTHO RITIES BELOW AND DIRECT THE AO TO DELETE THE SAME. HENCE, THIS GROUND OF ASSESSEES A PPEAL IS ALLOWED. 9. IN THE RESULT, ASSESSEES APPEAL STANDS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 10/11/2017 SD/- SD/- (% ') ( ') (S.S.VISWANETHRA RAVI) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER *DKP-SR.PS ) - 10/11/2017 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-M/SKALPANABIRI MFG.CO.PVT. LTD.VILL& P.O . AURANGABAD DIST. MURSHIDABAD, PIN-742201 2. /RESPONDENT-ACIT, CIRCLE-MURSHIDABAD, 39 R.N.TAGORE ROAD, P.O. BERHAMPUR, PIN 742101 3. , - / CONCERNED CIT 4. - - / CIT (A) 5. . %%, , , / DR, ITAT, KOLKATA 6. 2 / GUARD FILE. BY ORD ER/ , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO ,,