Dy.CIT., Central Cir -3, Hyderabad V. M/s Kishoresons Detergents Private Limited, Hyderabad

ITA 1819/HYD/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69814 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 14-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C H GOPINATH
• Assessee Lawyers: K C DEVADAS
• Keywords: Search and seizure
• Section: 143(3); 153A; 145; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER S.NO. ITA NO. AY APPELLANT RESPONDENT 1. 1817/H/12 2003-04 DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE 3, HYDERABAD KISHORESONS DETERGENTS PVT. LTD., HYDERABAD. (PAN AABCK2043B) 2. 1818/H/12 2004-05 -DO- -DO- 3 1819/H/12 2006-07 -DO- -DO- 4. 1820/H/12 2009-10 -DO- -DO- *- APPELLANT BY : SHRI C.H. GOPINATH RESPONDENT BY : SHRI K.C. DEVADAS DATE OF HEARING : 25/09/2013 DATE OF PRONOUNCEMENT : 27/09/ 2013 ORDER PER ASHA VIJAYARAGHAVAN, J.M.: ALL THESE APPEALS PERTAINING TO ONE ASSESSEE, FILE D BY THE REVENUE ARE DIRECTED AGAINST A COMMON ORDER OF THE CIT(A)-VII, HYDERABAD DATED 29/08/2012. AS IDENTICAL ISSUE IS I NVOLVED IN THESE APPEALS, THEY WERE CLUBBED AND HEARD TOGETHER AND, THEREFORE, WE DISPOSE OF THESE APPEALS BY WAY OF CO NSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE, A PRIVATE COMPANY IS DERIVING INCOME FROM THE BUSINESS OF MAN UFACTURE AND SALE OF DETERGENT CAKES. SEARCH AND SEIZURE OPERATI ONS WERE CARRIED OUT IN THE CASE OF THE ASSESSEE ON 18/06/20 08. IN RESPONSE TO THE NOTICE U/S 153A, THE ASSESSEE FOR T HE ASSESSMENT 2 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. YEARS 2003-04, 2004-05, 2006-07 AND 2009-10 DECLARI NG INCOME OF RS. 81,55,270/-, RS. 1,20,58,100/-, RS. 65,97,32 0/- AND RS. 57,19,610/- RESPECTIVELY, WHEREAS, THE AO HAD ASSES SED THE TOTAL INCOME AT RS. 82,68,118/- FOR AY 2003-04, RS. 1,56, 73,585/- FOR AU 2004-05, RS. 70,81,056/- FOR AY 2006-07 AND RS. 59,76,624/- FOR AY 2009-10, BY MAKING CERTAIN ADDITIONS BASED O N THE THEORY OF PERCENTAGE OF NET PROFIT OVER GROSS PROFIT. 3. WHILE COMPUTING THE TAXABLE INCOMES OF THE ASSES SEE FOR THE YEARS UNDER REFERENCE, THE AO HAD MADE ADDITIONS OF RS. 1,12,848/-, 36,15,485/-, 4,83,736/- AND RS. 2,57,01 4/-, ON THE BASIS OF THE INFERENCES DRAWN FROM THE VARIATIONS I N THE RATIO OF NET PROFITS TO THAT OF GROSS PROFITS OF THE ASSESSE E, FOR THE THREE ASSESSMENT YEARS, VI.Z, 2003-04, 2004-05 AND 2005-0 6. ACCORDING TO THE AO THE GROSS PROFITS OF THE ASSESS EE WERE IN THE RANGE OF 5.472, 10.33 AS AGAINST THE NET PROFIT OF 5.25 TO 6.51 FOR THE ABOVE THREE ASSESSMENT YEARS AND THE RATIO OF N ET PROFIT TO THE GROSS PROFIT HAD BEEN SHOWN TO BE IN THE RANGE OF RS. 59.47 TO 95.83. THE AVERAGE OF NET PROFIT TO THE GROSS PR OFIT RATIO HAD BEEN WORKED OUT TO 77.28 FOR THE THREE YEARS PUT TO GETHER AND THE ADDITIONS WERE MADE BASED ON THE DEFICIT OF SUC H RATIO OF NET PROFIT TO GROSS PROFIT, FOR THE RESPECTIVE ASSESSME NT YEARS VIS-- VIS THE AVERAGE OF THE RATIO OF NET PROFIT OVER GRO SS PROFIT (77.28%). THE WORKINGS OF THE SAID RATIOS BY THE A O HAD BEEN INDICATED IN THE ASSESSMENT ORDER AS UNDER: DESCRIPTION AY 2003-04 AY 2004-05 AY 2005-06 PERCENTAGE OF GROSS PROFIT 8.51 10.53 5.47 PERCENTAGE OF NET PROFIT 6.51 6.14 5.25 PERCENTAGE OF NET OVER GROSS 76.53 59.47 95.86 AVERAGE PERCENTAGE OF NET OVER GROSS 77.28 77.28 77.28 3 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. 4. THE WORKING OF THE AVERAGE PERCENTAGE OF NET OVE R GROSS FOR AY 2009-10 HAD BEEN WORKED OUT SEPARATELY, BASED ON SUCH PERCENTAGES FOR THE AY 2006-07, 2007-08, 2008-09 AN D 2009-10. THE DETAILED WORKING AS MADE OUT IN THE ASSESSMENT YEAR FOR AY 2009-10 IS A FOLLOWS: DESCRIPTION AY 200 6 - 0 7 AY 200 7 - 0 8 AY 200 8 - 0 9 AY 200 9 - 10 PERCENTAGE OF GROSS PROFIT 4.14 2.65 2.97 3.46 PERCENTAGE OF NET PROFIT 2.13 1.52 1.82 1.84 PERCENTAGE OF NET OVER GROSS 51.51 5 7.22 61.18 53.16 AVERAGE PERCENTAGE OF NET OVER GROSS 55.76 55.76 55.76 55.76 BASED ON THE ABOVE WORKINGS OF AVERAGE PERCENTAGE O F NET OVER GROSS, AT 77.28%, THE AO HAD MADE THE SAID ADDITION S BY PITTING THE AVERAGE PERCENTAGE OF NET OVER GROSS (77.28), A GAINST THE PERCENTAGE OF THE NET OVER THE GROSS FOR THE RESPEC TIVE ASSESSMENT YEARS. FOR AY 2009-10, THE AVERAGE PERCE NTAGE OF NET OVER GROSS HAD BEEN WORKED OUT AT 55.76 AGAINST THE PERCENTAGE FOR THAT YEAR WHICH STOOD AT 53.16. THE SAID ADDIT IONS HAD BEEN MADE BY THE AO BY OBSERVING THAT THE ASSESSEE HAD N OT ADMITTED THE NORMAL PROFITS FORM ITS MANUFACTURING ACTIVITY AS COMPARED TO THE OTHER YEARS IN CONSIDERATION AND HAD UNDERSTATE D THE INCOMES, FOR THE RESPECTIVE YEARS. 5. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN AP PEAL BEFORE THE CIT(A). 6. BEFORE THE CIT(A), THE ASSESSEE CONTENDED THAT T HE ADDITIONS WERE MADE BY THE AO ON CONJECTURES AND SU RMISES SUCH AS ASSUMED PERCENTAGE OF NET OVER GROSS AND IN THE PROCESS 4 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. COMPARISONS WERE MADE WITH THE SUBSEQUENT ASSESSMEN T YEARS, WITH REFERENCE TO SOME YEARS, WHICH IS NOT JUSTIFIE D. IT WAS ALSO CONTENDED BY THE ASSESSEE THAT THE AO, WITHOUT POIN TING ANY SPECIFIC DEFECTS AND NOT BEING IN ANY POSSESSION OF ANY SPECIFIC INFORMATION, IS NOT CORRECT IN ALLEGING THAT THE AS SESSEE UNDERSTATED THE INCOMES. IT WAS SUBMITTED BY THE AS SESSEE THAT THE ASSESSEE IS A CORPORATE ENTITY MAINTAINING BOOK S REGULARLY, WHICH ARE SUBJECTED TO AUDIT UNDER COMPANIES ACT AS WELL AS INCOME TAX ACT, WITH ALL THE PURCHASES AND SALES AR E VOUCHED AND THE QUANTITATIVE PARTICULARS MAINTAINED IN EXCISE R ECORDS. IT WAS ALSO SUBMITTED BY THE ASSESSEE THAT THE ASSESSMENTS WERE INVARIABLY COMPLETED U/S 143(3) AND THE RETURNED IN COMES WERE ACCEPTED WITHOUT MAKING ANY ADDITION. THE ASSESSEE FURTHER CONTENDED THAT THE ASSESSMENTS FOR THE YEARS UNDER CONSIDERATION WERE COMPLETED U/S 153A, IN PURSUANCE TO ACTION U/S 132 AND NO INFORMATION FOR MAKING SUCH ADDITIONS WERE FOUND DU RING THE SEARCH PROCEEDINGS. IT WAS ARGUED BY THE ASSESSEE T HAT PROVISIONS OF SECTION 145 ARE NOT APPLIED, NO SPECIFIC DEFECTS WERE POINTED OUT ANY BOOK RESULTS WERE NOT REJECTED, AS SUCH, TH ERE IS NO JUSTIFICATION FOR THE AO FOR MAKING THE ADDITION ON THE BASIS AS ADOPTED BY HIM AND CANNOT STAND ANY REASONABLE TEST OF LAW, MUCH LESS UNDER THE PROVISIONS OF THE IT ACT, 1961. ACCORDING TO THE ASSESSEE, THE DISCRETION EXERCISED BY THE AO IS NOT WARRANTED ON THE FACTS OF THE CASE OF THE ASSESSEE, AS NO COM PARABLE INSTANCE HAD BEEN BROUGHT OUT ON RECORD. IT WAS CON TENDED THAT THE BASIS OF CALCULATION, AS ADOPTED BY THE AO ARE IMAGINARY AND WITHOUT ANY RECORD TO THE ASPECTS OF RELEVANT TO DI RECT AND INDIRECT COSTS AND THE WORD USED NORMAL PROFITS A S POINTED OUT BY THE AO IN THE ASSESSMENT ORDER DO NOT HAVE ANY R ELEVANCE IN THE INCOME/ACCOUNTING PARLANCE. 5 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. 7. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSE E, THE CIT(A) OBSERVED THAT AS SEEN FROM THE RECORD, THE A SSESSMENT ORDERS U/S 153A IN PURSUANCE TO ACTION U/S 132 WERE COMPLETED IN THE ASSESSEES CASE FOR AY 2003-04 TO 2009-10, WHER EAS THE ADDITIONS MADE BY THE AO ARE CONFINED TO 2003-04, 2 004-05, 2006-07 AND 2009-10, WHICH MEANS THE BASIS ADOPTED BY THE AO ARE SELECTIVELY APPLIED FOR FEW YEARS THOUGH SUCH B ASIS IS EQUALLY APPLICABLE FOR ALL THE ASSESSMENT YEARS, SINCE THE NATURE OF BUSINESS REMAINS THE SAME FOR THE ASSESSEE. FURTHER , HE OBSERVED THAT AS IT HAS BEEN INFORMED AND BROUGHT ON THE REC ORD THAT FEW OF THE ORIGINAL ASSESSMENTS COMPLETED IN THE CASE O F THE ASSESSEE WERE ACCEPTED WITHOUT ANY ADDITIONS ON THE BASIS OF THE SIMILAR ISSUE AND THE ASSESSMENTS UNDER REFERENCE, AS INDIC ATED, ARE IN PURSUANCE OF ACTION U/S 132 OF THE IT ACT AND THERE IS NO INDICATION THAT THERE IS ANY EVIDENCE TO INDICATE T HAT THE ASSESSEE IS INDULGING IN SUPPRESSION OF PROFITS, AS PER THE INFORMATION BROUGHT ON THE RECORD. IN VIEW OF THE ABOVE OBSERVA TIONS, THE CIT(A) WAS OF THE VIEW THAT THERE IS NO BASIS FOR T HE AO TO DRAW THE INFERENCES AS TO THE WORKING OF THE PROFITS ON NOTIONAL AND FICTITIONAL BASIS AS ADOPTED IN THE ASSESSMENT ORDE R. 8. FURTHER, THE CIT(A) OBSERVED THAT ON EXAMINATION OF THE METHOD ADOPTED BY THE AO, IT IS CLEARLY INDICATIVE OF THE HIGHLY DISCRIMINATING METHOD CHOSEN TO ARRIVE AT THE PRESU MED UNACCOUNTED PROFITS AND IT IS CLEAR THAT FOR FEW AS SESSMENT YEARS, FOR EXAMPLE AY 2003-04, THE AO HAD USED THE BASIS F OR THE SUBSEQUENT YEARS AND WHEREAS IN THE CASE OF ANOTHER AY 2009-10, THE BASIS TAKEN WAS ON HISTORY OF PURELY EARLIER YE ARS/PERIODS. THUS, THERE IS NO CONSISTENCY IN THE METHOD ADOPTED BY THE AO IN ARRIVING AT THE AVERAGE OF NET OVER THE GROSS FOR D IFFERENT ASSESSMENT YEARS UNDER REFERENCE. HE FURTHER OBSERV ED THAT THE GROSS PROFITS AND THE NET PROFITS OF THE BUSINESS A RE TWO DIFFERENT 6 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. YARDSTICKS INDICTING THE PROFITS OF THE BUSINESS AN D ARE INFLUENCED BY DIFFERENT FACTORS AND SUCH FACTORS KEEP VARYING FROM YEAR TO YEAR AND TRADE TO TRADE OR BUSINESS TO BUSINESS AND WORKING OUT THE PERCENTAGES ON SUCH MODELS, CAN ONLY BE HELD AS THEORETICAL AND SANS ALL THE ACCEPTABLE ACCOUNTING STANDARDS AS PRESCRIBED. FURTHER, HE OBSERVED THAT THE AO HAD NOT SHOWN ANY DEFECTS IN THE BOOKS OR METHOD OF ACCOUNTANCY ADOPTED BY THE A SSESSEE AND BOOKS ARE NOT REJECTED SO AS TO ESTIMATE PROFITS OF BUSINESS. RATHER SUCH ESTIMATION IS RESORTED TO SUPERFLUOUS M ETHODS OF PERCENTAGE OF NET OF GROSS, WHICH IS NOT ORDINARILY HEARD IN THE ACCOUNTING LANGUAGES/PRACTICES. FURTHER, THE CIT(A) OBSERVED THE ADDITIONS MADE ON THEORETICAL BASIS, BASED ON SURMI SES AND CONJECTURES ARE DESIRED TO BE DESISTED IN SEARCH RE LATED CASES WITH NO ADVERSE INFORMATION FOUND, IN SUPPORT OF SU CH ESTIMATION/METHOD. 9. IN VIEW OF THE ABOVE OBSERVATIONS AND FOLLOWING THE DECISION OF THE SPECIAL BENCH OF ITAT, MUMBAI IN THE CASE OF ALL CARGO GLOBAL LOGISTICS & OTHERS (ITA NO. 5018 TO 5022 & 5 095/M/2010, THE CIT(A) HELD THAT IN ABSENCE OF ANY INCRIMINATIN G EVIDENCE FOUND AGAINST THE ASSESSEE IN PROVING THAT UNACCOUN TED INCOMES WERE GENERATED BY SUPPRESSION OF PROFIT, THE AO IS NOT JUSTIFIED IN RESORTING TO ESTIMATION AND ARITHMETICAL ASSUMPTION S AND, THEREFORE, THE ADDITIONS MADE BASED ON PERCENTAGE O F NET OVER GROSS ADOPTED BY THE AO ARE HELD TO BE WITHOUT ANY BASIS THAT CAN BE JUSTIFIED ON FACTUAL OR LEGAL GROUNDS. ACCORDING LY, HE DIRECTED THE AO TO DELETE THE ADDITIONS MADE BY HIM IN THE A SSESSMENT YEARS UNDER CONSIDERATION. 10. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVEN UE IS IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUN DS OF APPEAL, 7 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. WHICH ARE COMMON IN ALL THE APPEALS UNDER CONSIDERA TION, EXCEPT THE AMOUNT OF ADDITION: 1. THE LEARNED CIT(A) ERRED BOTH IN FACTS AND IN LA W IN DELETING THE ADDITION MADE. 2. THE LD. CIT(A) ERRED IN NOT APPRECIATING THE TOT AL FACTS OF THE CASE IN PURELY ALLOWING THE APPEAL ON TECHNICAL GROUNDS. 3. THE LD. CIT(A) ERRED IN NOT APPRECIATING THE FAC T THAT THE ORDER OF THE SPECIAL BENCH, ITAT, MUMBAI WAS DISTIN GUISHED BY THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT- VII VS. CHETAN DAS AND LACHMAN DAS. 4. THE LD. CIT(A) ERRED IN NOT APPRECIATING THE DET AILED WORKING AND DISCUSSION MADE BEFORE THE ADDITION FOR DECLARING THE LOW PROFITS. 11. THE LEARNED DR BESIDES RELYING UPON THE ORDER O F THE AO SUBMITTED THAT THE CIT(A) HAS NOT APPRECIATED THE DETAILED WORKING AND DISCUSSION MADE BY THE AO BEFORE MAKING ADDITIONS FOR THE ASSESSMENT YEARS UNDER CONSIDERATION FOR DE CLARING LOW PROFITS. 12. ON THE OTHER HAND, THE LEARNED AR OF THE ASSESS EE PLACING RELIANCE ON THE ORDER OF THE CIT(A) CONTENDED THAT THE AO WITHOUT POINTING OUT ANY SPECIFIC DEFECTS AND NOT BEING IN ANY POSSESSION OF ANY SPECIFIC INFORMATION, IS NOT CORRECT IN ALLE GING THAT THE ASSESSEE UNDERSTATED THE INCOMES. FURTHER, HE CONTE NDED THAT THE ASSESSMENTS WERE INVARIABLY COMPLETED U/S 143(3) OF THE ACT AND THE RETURNED INCOMES WERE ACCEPTED WITHOUT MAKING A NY ADDITION. IT WAS FURTHER CONTENDED THAT THE ASSESSMENTS FOR T HE YEARS UNDER CONSIDERATION WERE COMPLETED U/S 153A, IN PUR SUANCE TO ACTION U/S 132 OF THE ACT AND NO INFORMATION FOR MA KING SUCH ADDITIONS WERE FOUND DURING THE SEARCH PROCEEDINGS. IT WAS POINTED OUT THAT THE BASIS OF CALCULATION, AS ADOPT ED BY THE AO ARE IMAGINARY AND WITHOUT ANY RECORD TO THE ASPECTS OF RELEVANCE TO DIRECT AND INDIRECT COSTS AND THE WORD USED NOR MAL PROFITS AS 8 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. POINTED OUT BY THE AO IN THE ASSESSMENT ORDER DO NO T HAVE ANY RELEVANCE IN THE INCOME/ACCOUNTING PARLANCE. THE LE ARNED AR RELIED ON THE FOLLOWING DECISIONS IN SUPPORT OF ASS ESSEES CASE: 1. MGF AUTOMOBILES LTD. VS. ACIT, ITA NOS. 4212 & 4213/DEL/2011 FOR AY 2004-05 & 2005-06, ORDER DATED 28 TH JUNE, 2013. 2. JAI STEEL (INDIA), JODHPUR VS. ACIT, ITA NO. 53/ 2011 AND OTHERS VIDE JUDGMENT DATED 24 TH MAY, 2013. 3. JCIT VS. M/S SPECTRUM PEARLS & EXPORTS PVT. LTD. IN ITA NOS. 2107 TO 2113/HYD/2011 FOR AYS 2003-04 TO 2009- 10 ORDER DATED 04/04/2012. 13. WE HAVE HEARD THE ARGUMENTS OF BOTH THE PARTIES , PERUSED THE RECORD AND HAVE GONE THROUGH THE ORDERS OF THE AUTHORITIES AS WELL AS THE DECISIONS CITED. ADDITIONS HAVE BEEN MA DE BY THE AO FOR THE REASON THAT THE ASSESSEE HAS NOT ADMITTED T HE NORMAL PROFITS FROM ITS MANUFACTURING ACTIVITY AS COMPARED TO THE OTHER YEARS IN CONSIDERATION AND HAS UNDERSTATED THE INCO MES, FOR THE RESPECTIVE YEARS ON THE BASIS OF THE INFERENCES DRA WN FROM THE VARIATIONS IN THE RATIO OF NET PROFITS TO THAT OF G ROSS PROFITS OF THE ASSESSEE. ON THE OTHER HAND, THE CIT(A) BEFORE DIRE CTING THE AO TO DELETE THE ADDITIONS MADE GAVE CATEGORICAL FINDI NGS THAT THE AO HAS NOT SHOWN ANY DEFECTS IN THE BOOKS OR METHOD OF ACCOUNTANCY ADOPTED BY THE ASSESSEE AND BOOKS ARE N OT REJECTED SO AS TO ESTIMATE THE PROFITS OF BUSINESS. RATHER S UCH ESTIMATION IS RESORTED TO SUPERFLUOUS METHODS OF PERCENTAGE OF NET OF GROSS, WHICH IS NOT ORDINARILY HEARD IN THE ACCOUNTING LANGUAGES/PRACTICES. FURTHER, THE ADDITIONS MADE ON THEORETICAL BASIS, BASED ON SURMISES AND CONJECTURES ARE DESIRE D TO BE DESISTED IN SEARCH RELATED CASES WITH NO ADVERSE IN FORMATION FOUND, IN SUPPORT OF SUCH ESTIMATION/METHOD. 9 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. 14. SIMILAR ISSUE CAME UP FOR CONSIDERATION BEFORE THE COORDINATE BENCH OF ITAT, HYDERABAD IN CASE OF M/S SPECTRUM PEARLS & EXPORTS PVT. LTD. (SUPRA)WHEREIN THE COORD INATE BENCH HELD AS FOLLOWS: 8..THE CASE RECORDS REVEAL THAT NO INCRIMINA TING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPER ATIONS. THE DETERMINATION OF UNDISCLOSED INCOME CONSEQUENT TO SEARCH ACTION AND FRAMING ASSESSMENT UNDER SECTION 153C OF THE ACT IS DIFFERENT FROM REGULAR ASSESSMENT OR IT IS NOT SUBSTITUTE FOR REGULAR ASSESSMENT. BEING SO, THE AO SHALL FRAME ASSESSMENT ON THE BASIS OF INCRIMINATING MATE RIAL FOUND DURING THE COURSE OF SEARCH ACTION U/S 153C O F THE ACT. THE AO WITHOUT BRINGING ANY INCRIMINATING MATE RIAL ON RECORD FOR THE PURPOSE OF DETERMINATION OF UNDISCLO SED INCOME ON ESTIMATE BASIS IS NOT POSSIBLE IN THE PRE SENT CIRCUMSTANCES TO FRAME THE ASSESSMENT U/S 153C OF T HE ACT. THEREFORE, AFTER CONSIDERING THE TOTALITY OF FACTS AND THE CIRCUMSTANCES OF THE CASE AND AFTER GOING THROUGH T HE ORDER OF THE CIT(A) IN THE INSTANT CASE, WE FIND THAT THE CIT(A) IS PERFECTLY JUSTIFIED IN ALLOWING THE CLAIMS OF THE A SSESSEE. IN THIS VIEW OF THE MATTER, NO INTERFERENCE IS CALLED FOR. 15. IN THE PRESENT CASE, WE FIND THAT NO INCRIMINAT ING EVIDENCE FOUND AGAINST THE ASSESSEE IN PROVING THAT UNACCOUN TED INCOMES WERE GENERATED BY SUPPRESSION OF PROFIT AND, THEREF ORE, THE AO IS NOT JUSTIFIED IN RESORTING TO ESTIMATION AND ARITHM ETICAL ASSUMPTIONS. ACCORDINGLY, WE FIND NO INFIRMITY IN THE ORDER OF THE CIT(A) IN DIRECTING THE AO TO DELETE THE ADDITIONS MADE BY HOLDING THAT THE ADDITIONS MADE BASED ON THE PERCENTAGE OF NET OVER GROSS ADOPTED BY THE AO ARE HELD TO BE WITHOUT ANY BASIS THAT CAN BE JUSTIFIED ON FACTUAL OR LEGAL GROUNDS AND THE OR DER OF THE CIT(A) IS HEREBY CONFIRMED DISMISSING THE GROUNDS O F APPEAL RAISED BY THE REVENUE IN THIS REGARD IN ALL THE YEA RS UNDER CONSIDERATION. 10 ITA NOS. 1817 TO 1820 /HYD/12 KISHORESONS DETERGENTS PVT. LTD. 16. IN THE RESULT, ALL THE APPEALS BEING ITA NO. 18 17, 1818, 1819 & 1820/HYD/2012 FILED BY THE REVENUE ARE DISMI SSED. PRONOUNCED IN OPEN COURT ON 27/09/2013. SD/- SD/- (CHANDRA POOJARI) (ASHA VIJAYARAGHAV AN) ACCOUNTANT MEMBER JUDICIAL MEMBE R HYDERABAD, DATED: 27 TH SEPTEMBER, 2013. KV COPY TO:- 1) DCIT, CENTRAL CIRCLE - 3, 8 TH FLOOR, AAYAKAR BHAVAN, BASHEERBAGH, HYDERABAD 2) M/S KISHORESONS DETERGENTS PVT. LTD., 14-6-86, CHUD I BAZAR, HYDERBAD. 3) THE CIT (A)-VII, HYDERABAD 4) THE CIT(CENTRAL), HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD.