I.T.O Wd-3, Haldia, Purba Medinipur V. Shyamali Bera, Purba Medinipur

ITA 1735/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4619 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 1 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 12-05-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 03-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SALLONG YADEN ACIT SRDR
• Assessee Lawyers: K L BHAWMICK
• Keywords: Documents seized
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH A KOLKATA BEFORE SHRI N.V.VASUDEVAN, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 1735 / KOL / 2013 & C.O.110/KOL/2013 (A/O ITA NO.1735/KOL/2013) ASSESSMENT YEAR :2006-07 INCOME TAX OFFICER, WARD-3, HALDIA, VILL. BASUDEVPUR, P.O. KHANJANCHAK HALDIA, PURBA MEDINIPUR, PIN 721602 SHYAMALI BERA UTAR NARIKELDA, DAKSHIN NARIKELDA, PURBA MEDINIPUR, PIN-721636 V/S . V/S . SHYAMALAI BERA UTTAR NARIKELDA, DAKSHIN NARIKELDA, PURBA MEDINIPUR, PIN-721636 [ PAN NO.ADCPB 8825 H ] ITO, WARD-3, HALDIA, VILL. BASUDEVPUR, P.O. KHANJANCHAK, DIST. PURBA MEDINIPUR, PIN721602 /APPELLANT .. / RESPONDENT /BY ASSESSEE SHRI K.L.BHAWMICK, ADVOCATE /BY REVENUE SHRI SALLONG YADEN, ACIT-SR-DR /DATE OF HEARING 12-05-2016 ! /DATE OF PRONOUNCEMENT 05-07-2016 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY REVENUE AND CROSS OBJECTION (CO) BY ASSESSEE ARE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (AP PEALS)-XXXIII, KOLKATA DATED 08.03.2013. ASSESSMENT WAS FRAMED BY ITO WARD -3, HALDIA U/S ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 2 143(3)/145(3) OF THE INCOME TAX ACT, 1961 (HEREINAF TER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 31.12.2008 FOR ASSESSMENT YEAR 2006-07. SHRI K.L.BHAWMICK, LD. AUTHORIZED REPRESENTATIVE AP PEARED ON BEHALF OF ASSESSEE AND SHRI SALLONG YADEN, LD DEPARTMENTAL RE PRESENTATIVE APPEARED ON BEHALF OF REVENUE. FIRST WE TAKE UP REVENUES APPEAL IN ITA NO.1735/KO L/2013. 3. FIRST ISSUE RAISED BY REVENUE IN GROUND NO.1 IS REGARDING THAT LD. CIT(A) ERRED IN REDUCING ADDITION MADE BY THE AO ON ACCOUNT OF SUPPRESSION OF PURCHASE, GROSS PROFIT AND STOCK FROM RS. 55,28, 442.00 TO 16,95,715.00. THE RELEVANT GROUND RAISED BY REVENUE IS REPRODUCED BELOW:- 1) THAT ON THE FACTS AND IN CIRCUMSTANCES OF THE C ASE THE LD. CIT(A) ERRED IN REDUCING THE SUPPRESSION OF PURCHASE; SUPP RESSION OF GROSS PROFIT AND SUPPRESSION OF STOCK CALCULATED AT 44,66,817/-; 5,67,122/- AND 4,94,503/- RESPECTIVELY TO 16,95,715/- ONLY. 4. THE FACTS IN BRIEF ARE THAT ASSESSEE IN THE PRES ENT CASE IS AN INDIVIDUAL AND ENGAGED IN TRADING OF HARDWARE GOODS & CEMENT. A SURVEY ACTION U/S133A WAS CONDUCTED AT HER PREMISES ON 20.01.2006. DURING THE COURSE OF SEARCH, VARIOUS DOCUMENTS AND BOOKS OF ACCOUNT OF ASSESSEE WERE IMPOUNDED. THE ASSESSING OFFICER, IN HIS ASSESSMENT PROCEEDINGS HA S MADE THE FOLLOWING ADDITIONS TO THE TOTAL INCOME OF ASSESSEE:- 1) SUPPRESSION FOR PURCHASE 17950930 - 13484113 = 44,66,817/- 2) SUPPRESSION OF GP 1128004 - 560882 = 5,67,122/- 3) SUPPRESSION OF STOCK 1028357 - 533854 = 4,94,503 THE FIRST ADDITION SUPPRESSION OF PURCHASE WAS MADE BY ASSESSING OFFICER BY OBSERVING THAT ASSESSEE HAD ISSUED CHEQUES FROM ITS BANK ACCOUNT FOR PURCHASE OF GOODS FOR AN AMOUNT OF 1,75,50,167/- TO VARIOUS PARTIES. ACCORDINGLY THE AO WORKED OUT THE PURCHASES AFTER G IVING EFFECT TO THE ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 3 OPENING AND CLOSING BALANCE OF CREDITORS FOR THE YE AR UNDER CONSIDERATION WHICH STOOD AS UNDER:- A) BALANCE OF CREDITORS AS ON 31.03.2006 RS. 4,75,675/-. B) PAYMENT MADE THROUGH CHEQUES DURING F/Y RS.1,75 ,50,167/- C) TOTAL 1,80,258,42/- D) BALANCE OF CREDITORS AS ON 01.04.2005 RS. 7 4,912/- E) DIFFERENCE FOR THE PURCHASE OF RS.1,79,50,930/- LESS F) PURCHASE DECLARED IN HER RETURN FOR RS.1,34,8 4,113/- G) THE SHORT PURCHASES REPORTED BY RS. RS. 44,66, 817/- THE AO TREATED THE SHORT ABOVE DIFFERENCE AS SUPPRE SSION OF PURCHASE AND ACCORDINGLY ADDED IT TO THE TOTAL INCOME OF ASSESSE E. IN ADDITION TO ABOVE THE AO DURING THE COURSE OF AS SESSMENT PROCEEDING OBSERVED ON THE BASIS OF IMPOUNDED BOOKS THAT ASSES SEE HAS SOLD THE CEMENT OF ACC, LAFARGE, RASHMI, CRESCENT AND KONARK BRAND TO THE TUNE OF 45,39,436/- BUT ASSESSEE HAS NOT SHOWN CORRESPONDIN G PURCHASE OF CEMENT OF THE SAID COMPANIES. ACCORDINGLY, AO HAS DRAWN TH E FRESH TRADING ACCOUNT OF ASSESSEE AS UNDER:- OPENING STOCK (AS PER HER BOOKS ON 01.04.2005) RS.68,681 SALES (AS PER RETURN) RS.1.42,60,625 PURCHASE (AS DISCUSSED ABOVE) RS.1,79,50,930 SALES (SUPPRESSION AS DISCUSSED ABOVE) RS. 45,39,436 CARRIAGE INWARD (AS PER RETURN) RS. 6,55,893 CLOSING STOCK RS. 10,28,357 COOLIE CHARGE (AS PER RETURN) RS. 24,910 (BALANCING FIGURE) GROSS PROFIT (6%) RS. 11,28,004 TOTAL RS.1,98,28,418 RS.1,98,28,418 NOTE: SINCE THE GP FOR THE PERIOD 01.04.2005 TO 31. 03.2006 WAS ACHIEVED TO 6% OF THE SALES BY SRI LAKSHMI NARAYA BERA WHO IS ENGAGED IN THE SA ME LINE OF BUSINESS AS WELL AS COUNTERPART TO HER BUSINESS ACTIVITIES HENCE THE SA ME PERCENTAGE OF GP @ 6% IS CALCULATED AGAINST THE SALES OF RS.1,L88,00,061/- FOR THE PERI OD FROM 01.04.2005 TO 31.03.2006. ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 4 FROM THE ABOVE TRADING ACCOUNT THE GROSS PROFIT WOR KS OUT FOR 11,28,004/- BUT ASSESSEE HAS SHOWN THE GP AT 5,60,882/-. SO THE SUPPRESSED GP OF 5,67,122/- WAS ADDED TO THE TOTAL INCOME OF ASSESSE E. SIMILARLY FROM THE ABOVE TRADING ACCOUNT THE CLOSIN G STOCK WORKS OUT AT 10,28,357/- BUT ASSESSEE HAS SHOWN IN ITS RETURN OF INCOME THE CLOSING STOCK FOR 5,33,854/- AND AS SUCH, THERE IS A SUPPRESSION OF S TOCK FOR 4,94,503/-. ACCORDINGLY, AO MADE THE ADDITIONS OF 4,94,503/- AS SUPPRESSED CLOSING STOCK AS STATED ABOVE. 5. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE L D. CIT(A), WHEREAS ASSESSEE CONTESTED THAT ALL THE SALES AND PURCHASES WERE DULY RECORDED AND SUPPORTED WITH THE BILLS AND INVOICES IN ITS BOOKS OF ACCOUNT. THERE WAS NO UNACCOUNTED PURCHASE AT ALL. THE ASSESSEE WAS DEALI NG IN THE GRASIM CEMENT BRAND ONLY AND SHE WAS NOT SELLING CEMENT O F ANY OTHER BRAND. HOWEVER, ASSESSEE BEFORE LD. CIT(A) HAS TAKEN A NEW GROUND THAT THE FIGURE OF PURCHASES OF 1,79,50,930/- TAKEN BY AO IS BASED ON ALL THE DEBIT S FROM THE BANK STATEMENT BUT THE FACT IS THAT ALL THE DEBITS ENTRIES DO NOT REPRESENT PURCHASE. THERE WERE DEBIT ENTRIES OF 30,82,201/- AND 3,15,000/- WHICH WAS UTILIZED IN GIVING MONEY TO SHRI L.N. BERA AND SHRI SUBHASH BERA RESPECTIVELY. IF THESE DEBIT ENTRIES ARE EXCLUDED T HEN THERE WOULD HARDLY BE ANY DIFFERENCE BETWEEN PURCHASE AS PER BANK STATEME NT AND BOOKS OF ACCOUNT OF ASSESSEE. ACCORDINGLY, LD. CIT(A) HAS GIVEN PART LY RELIEF TO ASSESSEE BY OBSERVING AS UNDER:- II. SO FAR AS DEBITS IN BANK ACCOUNT ARE CONCERNED , DEBITS OF RS.33,97,201/- ARE STATED TO BE FOR MONEY GIVEN TO SHRI L.N.BERA AND SHRI SUBHASH BERA THE ASSESSING OFFICER HAS STATED THAT THE APPELLANT HAS NOT BEEN ABLE TO EXPLAIN PURPOSE OF SUCH TRANSF ER OF MONEY TO SHRI L.N.BERA AND SHRI SUBHASH BERA. HE HAS ALSO OBSERVE D THAT APART FROM TRANSFER ENTRIES THERE WERE SOME CASH WITHDRAWALS W HICH COULD NOT BE AUTOMATICALLY LINKED WITH SHRI L.N.BERA AND SHRI SU BHASH BERA. HOWEVER, WHETHER OR NOT THE APPELLANT IS ABLE TO EX PLAIN PURPOSE OF MONEY TRANSFER TO SHRI L.N.BERA AND SHRI SUBHASH BE RA, THE FACT REMAINS THAT SUCH TRANSFERS/WITHDRAWALS COULD NOT B E CONSIDERED AS ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 5 AMOUNTS UTILIZED FOR PURCHASES AS THESE WERE NOT PU RPOSE OF BUYING DRAFTS OR ISSUING CHEQUES FOR PURCHASE MADE FROM CE MENT COMPANIES. EVEN OTHERWISE, IT DOES NOT APPEAR TO BE LOGICAL FO R A BUSINESSMAN TO UTILIZE HIS REGULAR BANK ACCOUNT (FROM WHICH HIS DI SCLOSED TRANSACTIONS ARE MADE) TO MAKE UNACCOUNTED PURCHASES. THEREFORE I AM OF THE VIEW, THAT WHILE THE APPELLAN T HAS MADE UNACCOUNTED TRANSACTIONS FOR TRADING OF CEMENT OF B RAND OTHER THAN GRASIM, IT CANNOT BE SAID THAT ALL THE DEBITS IN RE GULAR BANK ACCOUNT WERE MADE FOR THAT PURPOSE. AS EXPLAINED BY THE APP ELLANT, IF THE ENTRIES FOR MONEY TRANSFER TO SHRI L.N.BERA AND SHRI SUBHAS H BERA ARE EXCLUDED, THE AMOUNT OF DEBITS ENTRIES WOULD NOT BE MUCH QUESTION FROM THE PURCHASES AND EXPENSES SHOWN IN THE REGULAR ACC OUNTS. THEREFORE I HOLD THAT DEBITS IN BANK ACCOUNT ARE NOT TO BE TAKE N AS BASIS FOR COMPUTING PURCHASES OF THE APPELLANT. 3.9 THE QUESTION THAT ARISES NEXT IS THAT, WHAT SHO ULD BE THE BASIS FOR COMPUTING UNACCOUNTED PURCHASE / SALE, IN PLACE OF THE DEBITS IN THE BANK ACCOUNT. IN THIS REGARD, IT IS OBSERVED THAT T HE UNACCOUNTED TRANSACTIONS, AS IDENTIFIED BY THE ASSESSING OFFICE R, CONSIST OF TWO PARTIES:- (A) THERE ARE SOME ENTRIES RELATING TO UNDISCLOSED SALE IN RESPECT OF CEMENT OF ACC, LAFARGE, RASHMI, CRESCENT AND KONARK BRANDS. ACCORDING TO THE ASSESSING OFFICER, THE IMPOUNDED B OOKS WERE SHOWING SUCH TRANSACTIONS AMOUNTING TO RS.45,39,436 /-. HERE IT MAY BE MENTIONED THAT THE ASSESSING OFFICER HAS, IN HIS REPORT DATED 16.08.12, GIVEN A LIST OF SOME ENTRIES AND IN ORAL DISCUSSION THE AUTHORIZED REPRESENTATIVE OF THE APPELLANT CONTENDE D THAT TOTAL OF THE LIST WAS MUCH LESS THAN THE FIGURE OF RS.45,39,436/ -. IN THIS REGARD, IT MAY BE MENTIONED THAT THE LIST IN THE REPORT WAS ON LY AN ILLUSTRATED LIST AND NOT AN EXHAUSTIVE ONE. THEREFORE, UNDISCLOSED S ALES OF BRANDS OTHER THAN GRASIM HAS TO BE TAKEN AT RS.45,39,436/- AS MENTIONED IN THE ASSESSMENT ORDER. IT MAY ALSO BE MENTIONED HERE THAT SECTION 292C PROVIDES THAT ANY BOOKS OF ACCOUNT OR OTHER DO CUMENTS ARE FOUND IN POSSESSION OF ANY PERSON IN THE COURSE OF SURVEY ACTION UNDER SECTION 133A, IT MAY BE PRESUMED THAT SUCH BO OKS OF ACCOUNT AND OTHER DOCUMENTS BELONG TO SUCH PERSON AND CONTE NTS OF THE SAME ARE TRUE. IT MAY ALSO BE RECALLED HERE, THAT T HE APPELLANT HAD MADE SEVERAL ATTEMPTS TO DISOWN THESE ENTRIES, FIRS T BY DENYING THE VERY EXISTENCE OF SUCH ENTRIES, THEN CLAIMING THAT THE CORRESPONDING PURCHASE MIGHT HAVE BEEN MADE DIRECTLY BY THE CUSTO MERS AND THE BY SUGGESTING THAT THE ENTRIES MIGHT BE RELATING TO BUSINESS OF HER HUSBAND. HOWEVER, ALL THESE CLAIMS WERE, AS DISCUSS ED ABOVE, FOUND TO BE INCORRECT. ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 6 (B) THE ASSESSING OFFICER HAS ALSO MENTIONED THAT A S PER ENQUIRES CONDUCTED UNDER SECTION 133(6), AS WELL IMPOUNDED B OOKS, TOTAL PURCHASES WERE AMOUNTING TO RS1,46,20,354/-. ON THE OTHER HAND, THE PURCHASES IN REGULAR BOOKS OF ACCOUNT WERE OF R S.1,34,84,113/-. THUS THERE WERE UNDISCLOSED PURCHASES AMOUNTING TO RS.11,36,241/- AS PER THE IMPOUNDED MATERIAL. AS TH ERE IS NO MATERIAL TO SUGGEST THAT THESE ALSO INCLUDED PURCHA SE OF CEMENT OF BRANDS OTHER THAN GRASIM, AMOUNT OF WHICH IS MUCH H IGHER, THESE ARE TO BE CONSIDERED SEPARATELY. IN HIS COMPUTATION , THE ASSESSING OFFICER HAS TAKEN GROSS PROFIT RATE OF 6% ON SALE. BASED ON THE SAME, THE CORRESPONDING UNACCOUNTED SALE WOULD BE ABOUT R S.12,08,767/-. AFTER CONSIDERING BOTH THE ABOVE AMOUNTS TOTAL UNAC COUNTED SALE WOULD BE RS.57,48,203/-. WHAT IS REQUIRED TO BE ADDED TO THE APPELLANTS INCOME IS THE GROSS PROFIT EARNED ON THE UNACCOUNTE D SALE AND INVESTMENT IN UNACCOUNTED PURCHASE. AT THE GP RATE OF 6% ADOPTED BY THE ASSESSING OFFICER, GROSS PROFIT ON UNDISCLOSED SALE WOULD COME TO RS.3,44,892/-. ALSO, THE PURCHASE CORRESPONDING TO UNACCOUNTED SALE WOULD BE RS.54,03,311/-. IN ORAL DISCUSSION, IT WAS CLAIMED THAT EVEN IF UNACCOUNTED TRANSACTIONS WERE MADE, SINCE THE ENTIR E PURCHASE WOULD NOT HAVE BEEN MADE AT ONE POINT OF TIME AND PROCEED S FROM CASH SALE WOULD BE AVAILABLE FOR FURTHER PURCHASES, ACTUAL IN VESTMENT IN UNACCOUNTED PURCHASE WOULD BE LOWER THAN TOTAL UNAC COUNTED PURCHASES. THERE IS SOME FORCE IN THE CONTENTION. H OWEVER, AS THE ENTRIES IN THE IMPOUNDED MATERIAL ARE RELATING TO U NACCOUNTED SALES AND NOT PURCHASES, IT IS NOT POSSIBLE TO WORK OUT ACTUA L PEAK INVESTMENT IN UNACCOUNTED PURCHASES. IN ABSENCE OF ANY DIRECT EVI DENCE IN THIS REGARD, IT IS CONSIDERED REASONABLE TO TAKE THAT IN VESTMENT MADE IN UNACCOUNTED PURCHASES MIGHT HAVE BEEN ROLLED OVER FOUR TIMES UPTO THE DATE OF SURVEY, AS THE UNACCOUNTED TRANSACTIONS IN THIS IMPOUNDED MATERIAL PERTAIN TO THAT PERIOD ONLY. ON APPLYING T HIS RATIO, INVESTMENT IN UNACCOUNTED PURCHASE OF RS.54,03,311/- WOULD BE RS. 13,50,823/-. TOTAL ADDITION ON PROFIT EARNED ON UNACCOUNTED SALE S AND INVESTMENT IN THE CORRESPONDING PURCHASE WOULD ACCORDINGLY COME T O RS.16,95,715/-. THE THREE ADDITIONS NAMELY SUPPRESSION OF PURCHASE AND SUPPRESSION OF GROSS PROFIT ARE ACCORDINGLY BEING REDUCED TO RS .16,95,715/-. NO SEPARATE ADDITION IS REQUIRED FOR SUPPRESSION OF ST OCK BECAUSE THE SAME IS ACQUIRED OUT OF UNACCOUNTED PURCHASES AND ADDITI ON FOR INVESTMENT IN UNACCOUNTED PURCHASES HAS ALREADY BEEN MADE. BEING AGGRIEVED BY THIS ORDER OF LD. CIT(A) REVENUE IS APPEAL BEFORE US. 6. THE LD. DR VEHEMENTLY SUPPORTED THE ORDER OF THE AO. ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 7 ON THE OTHER HAND, LD. AR SUBMITTED WRITTEN ARGUMEN TS AND STATED THAT AO HAS MADE THE ADDITIONS WITHOUT BRINGING ANY FACTUAL ERROR OR OMISSION IN THE BOOKS OF ACCOUNT OF ASSESSEE. THE ASSESSMENT WAS CO MPLETED NOT ON THE BASIS OF ASSESSEES BOOKS OF ACCOUNT BUT CONSIDERIN G ALL DEBITS ENTRIES OF THE BANK ACCOUNT OF THE ASSESSEE WHICH HAS NO BASE FOR MAKING THE ADDITION OF ACCOUNTED PURCHASE. LD. AR FURTHER STATED THAT LD. CIT(A) IS FULLY JUSTIFIED TO EXCLUDE THE DEBIT ENTRIES WHERE THE TRANSFER OF MON EY WAS MADE TO SHRI L.N. BERA AND SHRI SUBHASH BERA RESPECTIVELY FOR RS. 33, 97,201.00 ONLY. 7. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PART IES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN VIEW OF THE FOREG OING DISCUSSIONS, WE FIND THAT ADDITIONS HAVE BEEN MADE BY AO ON ACCOUNT OF S UPPRESSION OF PURCHASE, CLOSING STOCK AND GP. THE AO HAS WORKED OUT THE SUP PRESSED PURCHASE BY TREATING ALL THE DEBIT ENTRIES FROM THE BANK AS PUR CHASED AFTER ADJUSTING THE OPENING AND CLOSING FIGURES OF THE CREDITORS FOR TH E YEAR UNDER CONSIDERATION. THE AO HAS TAKEN THE GP RATIO @ 6% ON THE GROUND THAT THE OTHER PARTY WHO IS IN THE SIMILAR ACTIVITY HAS DECLARED ITS GP @ 6%, HENCE AO APPLIED THAT RATE. THE AO HAS DRAWN THE FRESH TRADING ACCOUNT OF THE A SSESSEE AFTER CONSIDERING THE UNACCOUNTED PURCHASE, SALES AND APPLIED THE GP RATIO @ 6% AND TREATED THE BALANCING FIGURE AS CLOSING STOCK. ACCORDINGLY THERE AROSE DIFFERENCE BETWEEN THE FIGURES OF GROSS PROFIT AND CLOSING STO CK WITH THE FIGURES DECLARED BY THE ASSESSEE WHICH WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE. HOWEVER THE LD. CIT(A) DELETED THE ADDITION ARISING ON ACCOUNT OF SUPPRESSED PURCHASES BY OBSERVING THAT ALL THE DEBIT ENTRIES D O NOT NECESSARILY REPRESENT THE PURCHASE MADE BY ASSESSEE. ACCORDINGLY THE ADDI TION FOR GROSS PROFIT AND CLOSING STOCK AS DETERMINED BY THE AO STAND DELETED . HOWEVER THE LD. CIT(A) WORKED OUT UNDISCLOSED SALE ON THE DIFFERENCE BETWE EN THE PURCHASE SHOWN BY THE ASSESSEE I.E. 1,34,84,113.00 AND PURCHASE FI GURES DERIVED AS PER THE CONFIRMATION OBTAINED UNDER SECTION 133(6) OF THE A CT I.E. 1,46,20,354.00. THE DIFFERENCE FOR SHORT PURCHASES WAS WORKED OUT FOR R S. 11,36,241.00 AND ITS SALE VALUE IS OF RS. 12,08,767.00 (11,36,241.00/94* 100). THIS UNACCOUNTED ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 8 SALE I.E. 12,08,767.00 WAS ADDED TO THE UNDISCLOSED SALE OF RS. 45,39,436.00 AS DISCOVERED DURING SURVEY AND ACCORDINGLY THE UNA CCOUNTED GP WAS WORKED OUT FOR RS. 3,44,892.00 (57,48,203.00 @ 6%) WHICH WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE. BESIDES THIS THE LD. CIT(A) WORKED OUT THE UNDISCLOSED INVESTMENT IN THE UNDISCLOSED PURCHASES OF RS. 54,03,311.00 ( RS. 57,48,203- RS.3,44,892) BY HOLDING THAT THE MON EY MUST HAVE BEEN ROLLED 4 TIMES UPTO THE DATE OF SURVEY I.E. RS. 13,50,827. 00. FINALLY THE AO MADE THE ADDITION OF FOR UNDISCLOSED PROFIT AND INVESTMENT F OR RS. 16,95,715.00 ONLY. NOW THE QUESTION BEFORE US ARISES SO AS TO WHETHER THE LD. CIT(A) IS JUSTIFIED IN RESTRICTING THE ADDITION TO RS. 16,95,715.00 IN THE AFORESAID FACTS & CIRCUMSTANCES. WE ALSO FIND THAT THE WITHDRAWAL FRO M THE BANK CAN BE FOR SEVERAL PURPOSES AND DO NOT NECESSARY REPRESENT THE PURCHASE. IN THIS CASE THE BASE TAKEN BY THE AO TO UNEARTH THE UNACCOUNTED PURCHASE WAS NOT CORRECT IN OUR CONSIDERED VIEW. THE AO HAS ALSO NOT BROUGHT ANY DEFECT IN THE STOCK REGISTER OF THE ASSESSEE BUT HAS RELIED ON TH E BALANCING FIGURE OF THE STOCK. ACCORDINGLY IN OUR VIEW THE AO HAS MADE THE ADDITION WITHOUT APPLYING HIS MIND FOR UNEARTHING THE DISCLOSED INCOME OF THE ASSESSEE. IN VIEW OF THE ABOVE, WE FIND THAT THE BASE ADOPTED BY AO FOR WORK ING OUT THE SUPPRESSED PURCHASE, GROSS PROFIT AND CLOSING STOCK WAS NOT PR OPER AND THEREFORE WE FIND NO REASON TO INTERFERE IN THE ORDER OF LD. CIT(A). HENCE THIS GROUND OF REVENUES APPEAL IS DISMISSED. 8. NEXT ISSUE IN THIS APPEAL OF REVENUE IS THAT LD. CIT(A) HAS FAILED TO CONSIDER THE PROVISION OF SEC.292C OF THE ACT. 9. AT THE OUTSET, WE OBSERVE THAT LD. CIT(A) HAS PA SSED A SPEAKING ORDER AND AFTER CONSIDERING THE SUBMISSION OF ASSESSEE AN D TAKING THE REMAND REPORT FROM ASSESSING OFFICER. AS PER SEC.292C OF T HE ACT THE DOCUMENTS SEIZED AT THE PREMISES OF ASSESSEE ARE PRESUMED BEL ONGING TO ASSESSEE ONLY AND ASSESSEE HAS TO JUSTIFY ABOUT THOSE DOCUMENTS. IN THIS CASE, WE FIND THAT LD. CIT(A) HAS DULY CONSIDERED THE JUSTIFICATION GI VEN BY ASSESSEE AND ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 9 ACCORDINGLY HE PASSED A SPEAKING ORDER. HENCE, WE F IND NO INFIRMITY IN THE ORDER OF LD. CIT(A). HENCE, THIS GROUND OF REVENUE IS DISMISSED. 10. IN THE RESULT, REVENUES APPEAL IS DISMISSED. COMING TO ASSESSEES CO NO.110/KOL/2013. 11. ASSESSEE HAS RAISED FOLLOWING GROUNDS:- I. THE LD. CIT(A) WAS NOT JUSTIFIED TO TREAT SALE PROCEEDS OF CEMENT OTHER THAN GRASIM(WHITE) BRAND IN THE HANDS OF THE ASSESSEE-AP PELLANT SHYAMALI BERA INASMUCH AS DEALINGS IN CEMENT OF EVERY OTHER BRAND RELATE TO LAKSHMI NARAYAN BERA HER HUSBAND FROM THE SAME BUSINESS CEN TRE; II. THE PRESUMPTION OF ACQUISITION OF SUCH CEMENT B Y SMT. SHYAMALI BERA IS NOT SUPPORTED BY CORROBORATIVE EVIDENCE LIKE CONFIR MATION OF SUPPLIES FROM SUCH SUPPLIERS OR SUPPORTING VOUCHERS; III. THE NATURE OF BUSINESS CARRIED ON BY BOTH THE WIFE AND THE HUSBAND IS ON RECORD OF BOTH THE AUTHORITIES WHICH HAVE BEEN DISR EGARDED BY BOTH THE AUTHORITIES; IV. THE COMPUTATION OF EXTRA CAPITAL REQUIRED TO EF FECT UNRECORDED PURCHASE (NOT ADMITTED) IS UNREASONABLY HIGH INASMUCH AS THE USUAL NUMBER OF ROTATIONS IN A YEAR IS MUCH MORE THAN FOUR AND AS S UCH THE AMOUNT IS LIABLE TO BE MODIFIED ACCORDINGLY; V. THE RESPONDENT RAISING THE CROSS OBJECTIONS CRAV ES THE LEAVE OF THE LD. BENCH TO ADD TO OR MODIFY ANY OF THE OBJECTIONS BE FORE OR AT THE TIME OF APPEAL HEARING. 12. GROUND NO. I TO III ARE INTERRELATED AND THEREF ORE BEING TAKEN UP TOGETHER. IN THE CO, THE ASSESSEE HAS MERELY SUPPOR TED THE IMPUGNED ORDER OF LD. CIT(A), WHEREBY HE DELETED THE DISALLOWANCE MADE BY THE AO IN ASSESSEES TOTAL INCOME ON ACCOUNT OF SUPPRESSED PU RCHASE, GROSS PROFIT AND CLOSING STOCK. SINCE WE HAVE ALREADY UPHELD THE ORD ER OF LD. CIT(A) GIVING RELIEF TO THE ASSESSEE ON THIS ISSUE WHILE DISMISSI NG THE APPEAL OF THE REVENUE, THE CO FILED BY THE ASSESSEE HAS BECOME IN FRUCTUOUS AND THE SAME IS ACCORDINGLY DISMISSED. ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 10 13. NEXT GROUND RAISED BY ASSESSEE IN CO IS THAT LD . CIT(A) ERRED IN COMPUTING EXTRA CAPITAL INVESTED IN THE UNRECORDED PURCHASE OF ASSESSEE IS UNREASONABLE HIGH. THE LD. CIT(A) HAS WORKED OUT THE INVESTMENT MADE B Y ASSESSEE IN HER UNRECORDED PURCHASE PRESUMING THE ROTATIONS OF FOUR TIMES AND DETERMINED THE UNDISCLOSED INVESTMENT AT 13,50,827.00/-. 14. LD. AR BEFORE US SUBMITTED THAT THE ROTATION OF THE CAPITAL IN THE BUSINESS IS 17 TIMES IN A YEAR AND IN SUPPORT OF AS SESSEES CLAIM SUBMITTED THE DETAILED OF CAPITAL EMBODIED IN THE BUSINESS VI S--VIS TURNOVER OF ASSESSEE FOR THE YEAR UNDER CONSIDERATION. ON THE CONTRARY, LD. DR RELIED ON THE ORDER OF LD. CIT(A). AFTER CONSIDERING THE BUSINESS AND R OTATION OF CAPITAL WE ARE OF THE CONSIDERED VIEW TO TAKE THE ROTATION CYCLE 15 T IMES AND ACCORDINGLY WORK OUT THE CAPITAL EMBODIED IN THE DISCLOSED PURCHASE FOR 3,60,220/- ( 54,03,311 / 15 TIMES). THIS GROUND OF ASSESSEES CO IS ALLOWED AND AO IS DIRECTED ACCORDINGLY. 15. LAST GROUND OF ASSESSEES CO IS GENERAL IN NATU RE AND DOES NOT REQUIRE ANY ADJUDICATION. 16. IN THE RESULT, ASSESSEES CO IS PARTLY ALLOWED. 17. IN COMBINE RESULT, APPEAL OF REVENUE IS DISMISSED A ND THAT OF ASSESSEES CO IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 05/ 07/2016 SD/- SD/- (N.V.VASUDEVAN) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP '#$- 05 / 07 /201 6 ITA NO.1735/KOL/2013 & CO 110/KOL/2013 A.Y. 2006-07 ITO WD-3HAL V. SHYAMALI BERA PAGE 11 / COPY OF ORDER FORWARDED TO:- 1. /ASSESSEE-SHYAMALI BERA, UTTAR NARIKELDA, DAKSHIN N ARIKELDA, PURBA MIDINIPUR PIN-721 636 2. /REVENUE-ITO, WARD-3, VILL.BASUDEVPUR, P.O. KHANJA NCHAK HALDIA, DIST. PURBA MED INIPUR, PIN-721 602 3.#,#-. / / CONCERNED CIT KOLKATA 4. /- / CIT (A) KOLKATA 5.2 3455-., -.!, / DR, ITAT, KOLKATA 6.489:; / GUARD FILE. BY ORDER/ , /TRUE COPY/ /# -.!,