The ACIT, Circle 5, RAJKOT-GUJARAT V. M/s Morbi Vegetable Products Ltd, Morbi

ITA 1216/RJT/2010

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1591 (ITAT-RAJKOT)
• Duration Of Justice: 8 year(s) 1 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 12-10-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DM RINDANI

Judgement Text

ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 1 OF 12 INCOM TAX APPELLATE TRIBUNAL-RAJKOT-BENCH-RAJKOT BEFORE C .M. GARG, JUDICIAL MEMBER AND O. P. MEENA, ACCOUNTANT MEMBER I.T.A NO. 1216/RJT/2010 ASSESSMENT YEAR: 2006-07 APPELLANT V. RESPONDENT ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-5, RAJKOT M/S. MORBI VEGETABLES PRODUCTS LTD. VEGETABLE ROAD MORBI PAN:AABCM 4867 H ASSESSEE BY SHRI D.M. RINDANI, CA REVENUE BY SHRI PRAV EE N VERMA, SR. D.R. DATE OF HEARING 22.11.2018 DATE OF PRONOUNCEMENT 26 .11.2018 ORDER PER O. P. MEENA, AM 1. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-IV, RA JKOT DATED 05.07. 2010 PERTAINING TO ASSESSMENT YEAR 2006-07. 2. GROUND NO. 1 STATES THAT THE LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE BY THE AO OF RS.58,54,592 ON ACCOUNT OF STOCK DIFFERENCE FOUND DURING SURVEY. 3. THE AO HAS OBSERVED THAT DURING THE COURSE OF SURVEY PROCEEDINGS CARRIED OUT ON 20.09.2005, STOCK DIFFERENCE BETWEEN PHYSICAL STOCK AND BOOKS STOCK OF RS. 83,98,469 WAS FOUND. HOWEVER, TH E ASSESSEE HAS NOT ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 2 OF 12 SHOWN THIS IN RETURN OF INCOME NOR THE EXPLANATION OFFERED WAS FOUND SATISFACTORY , THEREFORE, THE AO MADE AN ADDITION OF RS. 83,98,469. 4. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFOR E THE LD. CIT (A). DURING THE COURSE OF APPELLATE PROCEEDINGS, DE TAILED SUBMISSIONS WERE MADE BY THE ASSESSEE, THEREFORE, THE CIT (A) H AS REMANDED THE MATTER TO THE AO. THE AO VIDE LETTER DATED 18.01.201 0 SUBMITTED HIS REMAND REPORT ON THE POINTS RAISED BY THE ASSESSEE. THE CIT (A) NOTED THAT THE AO HAS MADE ADDITION OF RS.1,67,200 ON ACCO UNT OF EXCESS 292 TINS OF RANJIT VEGETABLE GHEE FOUND. IT WAS EXPLAIN ED THAT THE DURING SURVEY, PRODUCTION OF PLANT WAS GOING ON, HENCE, PR ODUCTION WAS NOT RECORDED IN STOCK REGISTER ON THE DAY OF SURVEY BUT IT WAS RECORDED NEXT DAY. THE AO HAS VERIFIED THIS FACTS DURING REMAND PR OCEEDING. AS AGAINST EXCESS STOCK OF 15 KG, THE ASSESSEE HAS SHOWN 757.5 0 KG AND THERE WAS PRODUCTION RECEIPT OF 1612 TINS, WHICH HAS BEEN DUL Y VERIFIED BY THE AO IN REMAND PROCEEDINGS. THUS, THE ASSESSEE HAS ALREA DY SHOWN RECEIPT OF 1612 TINS AS AGAINST EXCESS OF 292 TINS. IN VIEW OF THESE FACTS AND CIRCUMSTANCES, THE CIT (A) FOUND THAT INVENTORY AT SERIAL NO. 55 OF LOOSE SHEET SHOWED 757.50 KG OF RANJIT GHEE MADE DURING S URVEY, WHICH THE AO HAS VERIFIED DURING REMAND REPORT PROCEEDINGS. HE NCE, THE APPELLANT HAS SHOWN THE STOCK, THEREFORE, CONTENTION OF THE A O OF THE THAT EXCESS ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 3 OF 12 STOCK IS NOT ACCOUNTED FOR IS NOT CORRECT HENCE, AD DITION OF RS.1,67200 WAS THEREFORE, DELETED. 5. THE EXCESS STOCK OF TULSI VANASPATI TIN- 15 KG IS C ONCERNED, THE AO HAD CONTENDED THAT 532 TINS WERE EXCESS HENCE; HE MADE ADDITION OF RS. 2, 57,920. HOWEVER, THE CIT (A) FOUND THAT T HE APPELLANT HAS ALREADY SHOWN PRODUCTION OF 574 TINS ON 20.09.2005 WHICH HAS BEEN VERIFIED BY THE AO DURING THE COURSE OF REMAND PROC EEDINGS AND HAS BEEN FOUND TO BE CORRECT. THEREFORE, IF THE SAME IS CONSIDERED THEN FINDINGS OF THE AO THAT 532 TINS IS NOT ACCOUNTED FO R STANDS SETTLED. ACCORDINGLY, THE ADDITION OF RS. 2,57,920 WAS DELET ED. 6. WITH REGARD TO EXCESS STOCK OF 15 KG OF BIB/TP TINS VALUED AT RS.1,35,975, THE CIT (A) OBSERVED THAT THE APPELLAN T IS UNABLE TO EXPLAIN THE EXCESS STOCK OF 259 TINS OF THIS ITEM HENCE, TH E ADDITION OF RS.1,35,975 MADE BY THE AO ON THIS ACCOUNT WAS SUSTA INED. 7. THE NEXT ADDITION OF RS. 4,13,580 WAS MADE BY THE A O ON ACCOUNT OF KRISPI VANASPATI OF 20 KG BY 678 TINS, THE AO DI SCUSSED THIS IN PARA 5.2 ( C) OF HIS ORDER. THE CONTENTION OF THE ASSESS EE IN THIS REGARD WAS NOT FOUND ACCEPTABLE AS THE ASSESSEE WAS UNABLE TO EXPLAIN SHORTAGE AND HENCE, ADDITION OF RS. 4,13,580 WAS CONFIRMED. ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 4 OF 12 8. THE NEXT ADDITION OF RS. 55,550 MADE AS PER PARA 5.2. (D) OF ASSESSMENT ORDER WAS NOT FOUND EXPLAINED HENCE, CIT (A) SUSTAINED THE SAID ADDITION. 9. THE NEXT ADDITION OF RS. 136 TINS OF RANJIT GOLD CO IN VANASPATI OF RS. 73,440 MADE BY THE AO VIDE PARA 5.3 OF ASSESSMEN T ORDER, WAS FOUND TO BE EXPLAINED BY THE ASSESSEE AND SAME WAS VERIFIED BY THE AO DURING THE COURSE OF REMAND PROCEEDINGS. HENCE, SAI D ADDITION WAS DELETED. 10. THE NEXT ADDITION RELATES TO ADDITION OF RS.41,850 OF 1240 POUCHES OF 1 LITRE OF VANASPATI , IT WAS EXPLAINED THAT TH E AO HAS ERRONEOUSLY CONSIDERED THIS TO BE KG OF POUCH WHICH IN FACTS OF 1 LITRE OF POUCH, WHICH HAS BEEN ALREADY ACCOUNTED FOR IN PRODUCTION OF 8980 POUCHES ON THE DATE OF SURVEY. THEREFORE, CIT (A) OBSERVED THA T THE APPELLANT HAS ALREADY SHOWN 8980 POUCHES, WHICH IS GREATER THAN 1 240 POUCHES, SO THE EXCESS STOCK STANDS ACCOUNTED FOR. THEREFORE, A DDITION OF RS.41,850 WAS DELETED. THE CIT (A) HAS CONFIRMED THE ADDITION OF RS.608 BEING EXCESS STOCK OF 200 ML LETTERS AND SHORTAGE OF VANA SPATI BY LETTERS OF RS.2040 MADE BY THE AO. 11. THE AO MADE NEXT ADDITION OF RS.34,400 ON ACCOUN T OF SHORTAGE OF 40 TINS OF GROUND NUT OIL AS PER PARA 5.6 (A) OF ASSESSMENT ORDER AND FURTHER, ADDITION OF RS. 86,625 OF SHORTAGE TINS OF 105 AGGREGATING TO RS. ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 5 OF 12 1,21,025. IT WAS EXPLAINED THAT THE ASSESSEE HAS DI SPATCHED 100 TINS DURING THE DAY FOR WHICH INVOICES WERE FILED, THUS, SHORTAGE REMAINS FOR 45 TINS VALUED AT RS.38,700. IN CONSIDERATION, THE CIT (A) HELD THAT SINCE THE APPELLANT HAS ALREADY ACCOUNTED FOR 100 TINS HE NCE, BALANCE OF 45 TINS REMAINS HENCE, ADDITION WAS RESTRICTED TO RS. 38,700 AS AGAINST RS. 1,21,025. 12. THE NEXT ADDITION OF RS.4,17,800 RELATES TO EXCESS STOCK OF 72.049 MT GROUND NUT OIL CAKE. IT WAS EXPLAINED THAT WEIGHT OF 760.8 MT HAS BEEN TAKEN THE AVERAGE RATE PER BAGS AT 80 KILOGRAM S BY MULTIPLYING WITH 9510 BAGS THAT WERE PHYSICALLY FOUND. HOWEVER , CIT (A) OBSERVED THAT PHYSICAL BAGS SO FOUND WERE APPEARED TO BE TAL LIED WITH THE NUMBER OF BAGS APPEARING IN THE STOCK BOOK. HOWEVER, AT TH E APPELLANT`S STAGE HE IS UNABLE TO ACCEPT THAT DIFFERENCE ARISEN DUE T O DIFFERENT WEIGHT TAKEN. THEREFORE, THIS ADDITION OF RS. 4, 17,800 WA S CONFIRMED. 13. SIMILARLY VIDE PARA 14.2, THE CIT (A) DELETED THE A DDITION OF RS. 68,750 IN RESPECT OF 1650 TINS. 14. THE NEXT ADDITION RELATES TO SHORTAGE OF 107.875 MT OF RD PALM OIL (LOOSE) OF RS. 33,54,913. IT WAS EXPLAINED THAT AS REFLECTED AT PAGE NO. 46 OF PAPER BOOK, THE STOCK OF 109 MT FROM RBD PALM OIL WAS TRANSFERRED IN THE PRODUCTION OF GHEE, WHICH IS CLE ARLY REFLECTED ON 20.09.2005. THE CIT (A) OBSERVED THAT PLANT WAS IN OPERATION DURING ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 6 OF 12 SURVEY AS MENTIONED EARLIER CONSEQUENTLY, THERE WAS ONGOING CONSUMPTION OF RAW MATERIAL, PRODUCTION AND SALE AC TIVITIES. AS PER THE SYSTEM OF ACCOUNTING CURRENTLY BEING FOLLOWED, ALL THE MOVEMENTS IN THE INVENTORIES WERE BEING RECORDED ON SUBSEQUENT D AY. THE APPELLANT HAS ALREADY ACCOUNTED CONSUMPTION OF 109 MT OF RBD PALM OIL (LOOSE) WHICH HAS BEEN VERIFIED BY THE AO DURING THE COURSE OF REMAND PROCEEDINGS AND FOUND TO BE CORRECT. THEREFORE, TH E PHYSICAL STOCK WOULD BE EXCESS BY 1.12 MT. THEREFORE, ADDITION MAD E ON ACCOUNT OF SHORTAGE OF STOCK OF 107.875 MT OF RBD PALM OIL IS NO LEDGER SURVIVE, HENCE, ADDITION OF RS.33,54,913 WAS DELETED. 15. THE NEXT ADDITION OF RS.1,68,521 RELATES TO EXCESS STOCK OF 45.693 MT OF IMPORTED SOYABEAN REFUND OIL AS DISCUSSED IN PARA 5.10(A) OF HIS ORDER. IT WAS EXPLAINED THAT THAT THERE WAS PRODUCT ION OF 28.860 MT DURING THE DAY WHICH HAS BEEN DULY ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS AS REFLECTED AT PAPER BOOK PAGE NO. 49 . T HEREFORE, DIFFERENCE COMES TO RS. 5,82,654. FURTHER, THE VALUE OF DIFFE RENCE IN RECONCILIATION COMES TO RS. 2,34,468 AND NOT RS. 4,67,266 AS STATE D BY THE AO. THE CIT (A) OBSERVED THAT THE APPELLANT HAS ALREADY ACCOUNT ED FOR PRODUCTION OF 28.860 MT OF THIS PRODUCT IN THE BOOKS OF ACCOUN TS WHICH ALSO BEEN VERIFIED BY THE AO DURING THE COURSE OF REMAND REPO RT PROCEEDINGS, WHICH HAS BEEN FOUND TO BE CORRECT. AS PER REMAND R EPORT OF THE AO, ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 7 OF 12 EXCESS OF 16.833 REMAINS TO BE UNEXPLAINED. THEREFO RE, OUT OF EXCESS STOCK OF 45.693 MT STANDS RESOLVED TO THE EXTENT OF 28.860 MT AND ONLY BALANCE EXCESS OF 16.833 MT REMAINS UNEXPLAINED. IN VIEW OF THIS, THE ADDITION WAS RESTRICTED TO RS. 6, 19,454 AND RELIEF OF RS. 10,62,066 WAS ALLOWED. 16. THE NEXT ADDITION OF RS. 4,67,266 RELATES TO SHORTA GE OF 13.990 MT OF DEGUM SOYA OIL. THE CIT (A) OBSERVED THAT THE AP PELLANT HAS SUBMITTED DETAILED RECONCILIATION OF STOCK APPEARIN G IN THE BOOKS OF ACCOUNTS. DURING THE COURSE OF REMAND REPORT PROCEE DINGS, THE AO VERIFIED THE STOCK AND FOUND THE EXCESS STOCK OF 2, 34,468 OF 7.02 MT OF DEGUM SOYA OIL. SINCE THE MOVEMENTS OF STOCK PRODUC TION IS ACCOUNTED FOR SUBSEQUENT DAY. THE APPELLANT HAS ALREADY ACCOU NTED FOR AN INWARD RECEIPT 18.070 MT OF THIS ITEM IN BOOKS OF ACCOUNTS . HENCE, THIS EXCESS STOCK IS NO LONGER SURVIVED; THEREFORE, INCORRECT A DDITION OF RS. 4, 67,266 MADE BY THE AO AND ADDITION OF RS.2, 34,468 S O ARRIVED AT BY THE AO WAS ALSO DELETED. 17. THE NEXT ADDITION OF RS. OF RS.52,91,354 RELATES TO EXCESS CRUDE PALM OIL (LOOSE) OF 170.140 MT. IT WAS EXPLAINED TH AT THE CALIBRATION CONVERSION ON THE TANK WAS 1 CM=83.925 AS COULD BE SEEN FROM THE PHOTOGRAPH OF SAID TANK NO. 23 WHEREIN SAID CONVERS ION IS STATED AT 1 CM = 83.925 BUT THE AO HAS ERRONEOUSLY CONSIDERED TH E CONVERSION AT 1 ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 8 OF 12 CM = 83925 KILOGRAMS. WHEREAS CALIBRATION CONVERSI ON OF TANK NO. 22 IS AT 1CM= 56.250 KG, WHICH THE AO HAS CORRECTLY, AD OPTED. IN VIEW OF THESE FACTS, THE CIT (A) OBSERVED THAT SAID EXCESS STOCK HAS BEEN ARISEN DUE TO MISCALCULATION BY THE AO WITH REGARD TO CALIB RATION CONVERSION. SINCE THE APPELLANT`S CONTENTION HAS BEEN VERIFIED BY THE AO DURING THE COURSE OF REMAND REPORT PROCEEDINGS, THE SAID QUEST ION OF THERE BEING EXCESS STOCK OF 170.140 MT IS NO LONGER SURVIVED. H ENCE, ADDITION OF RS. 52,91,354 WAS THEREFORE, DELETED. HOWEVER, CIT (A) HAS CONFIRMED THE ADDITION OF STOCK OF RS. 20,437 BEING EXCESS VEGETA BLE GHEE. FURTHER, ADDITION OF RS. 8,16,035 OF 15.251 MT WAS ALSO CON FIRMED. 18. WITH REGARD TO EXCESS STOCK OF 4713 TINS OF RS. 6,7 9,089 , THE CIT (A) NOTED THAT THE APPELLANT HAS ALREADY ACCOUNTED FOR RECEIPT OF 4297 TINS AS PER PRACTICE BEING FOLLOWED AS DISCUSSED A BOVE, HENCE, ADDITION OF RS. 6,57,041 WAS DELETED AND BALANCE ADDITION OF RS. 22,048 WAS CONFIRMED. 19. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LD. SR. D.R. RELYING ON THE ORDER OF THE AO SUBMITTED THAT DIFFERENCE IN STOCK OF RS.83,98,469 FOUND DURING TH E COURSE OF SURVEY PROCEEDINGS. THE ASSESSEE COULD NOT EXPLAINED THE S AME PROPERLY HENCE, THE AO MADE ADDITION OF THE SAME. HOWEVER, CI T (A) HAS DELETED THE ADDITION OF RS.58,54,592 AFTER OBTAINING AND EX AMINING THE REMAND ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 9 OF 12 REPORT FROM THE AO . THEREFORE, THE LD. SR. D.R. REL IES ON FINDING OF THE ASSESSEE. 20. PER CONTRA, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AO HAS MADE ADDITION OF RS.83,98,469. THE CIT (A ) HAS CALLED FOR A REMAND REPORT FROM THE AO AND BASED ON THE SAME HAS CONFIRMED THE ADDITION OF RS.25 LAKHS ON WHICH THE ASSESSEE HAS N OT FILED ANY SECOND APPEAL. THE CIT (A) AFTER CONSIDERING REMAND REPORT FROM THE AO IN WHICH THE AO HAS VERIFIED THE DIFFERENCE OF STOCK AS PER RECONCILIATION FILED BY THE ASSESSEE. THEREFORE, CIT (A) HAS DELET ED THE ADDITION OF RS. 58,54,592. HENCE, THE CIT (A) HAS CORRECTLY DELETED THE ADDITION MADE BY THE AO ON INCORRECT FACTS AND NOT CONSIDERING THE EXPLANATION PROVIDED BY THE ASSESSEE DURING THE COURSE OF ASSES SMENT PROCEEDINGS. HENCE, SAME MAY BE UPHELD. 21. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. ONGOING THROUGH THE FINDINGS OF LD. CIT (A), AS MENTIONED IN THE ABOVE PARA OF THIS ORDER, WE FIND THAT THE CIT (A) HAS ANALYZED THE ITEMS WISE DETAILS OF STOCK DIFFERENCE WORKED OUT BY THE AO AND SUBMISSION MADE BY THE ASSESSEE. WE FURTHER F IND THAT THE CIT (A) HAS CALLED FOR A REMAND REPORT FROM THE AO. THE AO VIDE HIS REMAND REPORT DATED 18.01.2010 HAS VERIFIED THE CONTENTION S OF THE ASSESSEE AND SAME STANDS REEXAMINED BY THE CIT (A) AND FOUND TO BE CORRECT. ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 10 OF 12 THEREFORE, CIT (A) HAS DELETED THE ADDITION MADE BY THE AO BASED ON REMAND REPORT OF THE AO. HENCE, REVENUE SHOULD NOT H AVE ANY GRIEVANCE NOW AS THE DECISION OF CIT (A) IS BASED O N VERIFICATION CARRIED OUT BY THE AO DURING THE COURSE OF REMAND REPORT PR OCEEDINGS. WE HAVE GONE THROUGH THE REMAND REPORT AS WELL AS THE ORDER OF CIT (A) AND FOUND THAT THE CIT (A) HAS CONFIRMED THE ITEMS OF S TOCK AROUND RS.25 LAKHS, WHICH WERE NOT RECONCILED BY THE ASSESSEE AN D DELETED THE ADDITION OF THOSE ITEMS, WHICH STOOD RECONCILED AND STAND VERIFIED BY THE AO. IN VIEW OF THESE FACTS AND CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT THE CIT (A) HAS PASSED A JU DICIOUS AND CLEAR ORDER BASED ON FACTS, WHICH WERE VERIFIED BY THE AO; THEREFORE, WE DO NOT HAVE ANY REASON TO INTERFERE WITH THE SAME. TH EREFORE, SAME IS UPHELD. EX-CONSEQUENTI, THIS GROUNDS OF APPEAL OF R EVENUE IS THEREFORE, DISMISSED. 22. GROUND NO. 2 RELATES TO DELETION OF ADDITION OF RS. 1,07,340 ON ACCOUNT OF DIFFERENCE IN CASH NOT EXPLAINED DURING SURVEY. 23. THE AO HAS MADE ADDITION OF RS.1,07,840 BEING DIFFER ENCE IN CASH FOUND PHYSICALLY DURING SURVEY AND THAT CASH APPEAR ING IN BOOKS OF ACCOUNTS. THE CIT (A) OBSERVED THAT CASH IN HAND A S PER BOOKS OF ACCOUNTS WAS AT RS.2,83,034 AND CASH PHYSICALLY FOU ND DURING SURVEY WAS AT RS.1,75,197. THUS, THERE WAS SHORTAGE OF CASH OF RS.1,07, 840. THE ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 11 OF 12 AO HAS DISREGARDED THE EXPLANATION THAT CASH GIVEN T O PARTIES ON DATE OF SURVEY AS ADVANCE WAS RECORDED SUBSEQUENT TO DAT E OF SURVEY. FURTHER, THE DEFECT PER SE CANNOT BE TREATED AS AN INCOME. THE AO HAS NOT BROUGHT ON RECORD ANYTHING TO ESTABLISH THAT EX PLANATION OFFERED BY THE ASSESSEE WAS NOT CORRECT. THEREFORE, THE ADDITI ON OF RS. RS. 1,07, 840 ON ACCOUNT OF DEFICIENCY OF CASH WAS DELETED. 24. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LD. SR. D.R. RELIED ON THE AO. 25. AU CONTRAIRE, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THA T NO ADDITION COULD BE MADE ON ACCOUNT OF DIFFERENCE IN CASH FOUND DURING THE COURSE OF SURVEY. FURTHER, THE AO DISBELIEVED TH AT CASH WAS GIVEN AS ADVANCE NOT ACCOUNTED FOR ON THE DATE OF SURVEY BUT IT WAS ACCOUNTED FOR ON SUBSEQUENT DATE OF SURVEY. THEREFORE, CIT (A ) HAS RIGHTLY DELETED THE ADDITION SO MADE. 26. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT THE ASSESSEE HAS E XPLAINED THAT CASH WAS FOUND SHORT AS IT WAS GIVEN TO VARIOUS PARTIES AS ADVANCE ON THE DATE OF SURVEY, WHICH REMAINED TO BE ENTERED IN TO CASHB OOK, AND IT WAS ACCOUNTED FOR NEXT DAY. WE FURTHER ARE OF THE VIEW THAT NO ADDITION CAN BE MADE ON ACCOUNT OF SHORTAGE OF CASH. THEREFORE, WE DO NOT FIND ANY ACIT- 5, RAJKOT V. MORBI VEGETABLES PRODUCTS LT D./I.T.A.NO. 1216/RJT/2010/A.Y. 06-07 PAGE 12 OF 12 INFIRMITY IN THE ORDER OF CIT (A), ACCORDINGLY, SAM E IS UPHELD. THIS GROUNDS OF APPEAL IS THEREFORE, DISMISSED. 27. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMIS SED. 28. ORDER PRONOUNCED IN THE OPEN COURT ON 26.11.2018 . SD/- SD/- ( C.M. GARG) (O. P. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER RAJKOT: DATED: 2 6 NOVEMBER 2018 /OPM COPY OF ORDER SENT TO - ASSESSEE/AO/PR. CIT/ CIT (A)/ ITAT (DR)/GUARD FILE OF ITAT. B Y ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, RAJKOT