M/s. Sun Synthetics, Amritsar V. Income tax Officer, Amritsar

ITA 191/ASR/2009

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0503 (ITAT-AMRITSAR)
• Duration Of Justice: 7 year(s) 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 30-05-2016
• Assessment Year: 2001-2002
• Appeal Filed On: 21-04-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASR; ASHWANI KA LIA CA ITA NOS
• Keywords: Income from undisclosed sources
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A NOS.256(ASR)/2009 ASSESSMENT YEAR: 2001-02 INCOME TAX OFFICER, WARD-1(2), AMRITSAR. VS. M/S. SUN SYNTHETICS, SRI DARBAR SAHIB ROAD, AMRITSAR. PAN: AAACFS6802L (APPELLANT) (RESPONDENT) I.T.A NO. 191(ASR)/20 09 ASSESSMENT YEAR: 2001-02 M/S. SUN SYNTHETICS, SRI DARBAR SAHIB ROAD, AMRITSAR. PAN: AAACFS6802L VS. INCOME TAX OFFICER, WARD-1(4), AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A NO.257(ASR)/2009 ASSESSMENT YEAR: 2001-02 INCOME TAX OFFICER, WARD-1(2), AMRITSAR. VS. M/S. SURYA SYNTHETICS, SRI DARBAR SAHIB ROAD, AMRITSAR. PAN: AAACFS6810K (APPELLANT) (RESPONDENT) I.T.A NO. 192(ASR)/ 2009 ASSESSMENT YEAR: 2001-02 M/S. SURYA SYNTHETICS, SRI DARBAR SAHIB ROAD, AMRITSAR. PAN: AAACFS6810K VS. INCOME TAX OFFICER, WARD-1(4), AMRITSAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. UMESH TAKYAR (DR) RESPONDENT BY: SH. ASHWANI KA LIA (CA) ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 2 DATE OF HEARING: 30.05.2016 DATE OF PRONOUNCEMEN T: 15.07.2016 ORDER PER T. S. KAPOOR (AM): THESE ARE CROSS APPEALS FILED BY TWO DIFFERE NT ASSESSEES AGAINST THE SEPARATE ORDERS OF LEARNED CIT(A), BOTH DATED 27.02 .2009 FOR ASST. YEAR: 2001-02. 2. THE APPEALS WERE EARLIER DISPOSED OFF BY THE HON BLE TRIBUNAL VIDE ITS ORDER DATED 12 TH DECEMBER, 2011. IN THAT ORDER THE HONBLE TRIBUNAL HAD REMITTED THE APPEALS FILED BY ASSESSEE TO THE OFFIC E OF ASSESSING OFFICER FOR FRESH ADJUDICATION AND THE APPEALS FILED BY REVENUE WERE DISMISSED. 3. THE DEPARTMENT WENT INTO APPEAL AGAINST THE SAID ORDER OF TRIBUNAL AND HONBLE PUNJAB & HARYANA HIGH COURT VIDE ITS OR DER DATED 8.12.2014 REMITTED THE ISSUE BACK TO THE OFFICE OF TRIBUNAL F OR FRESH ADJUDICATION. 4. AT THE OUTSET, THE LEARNED AR OF THE ASSESSEE SU BMITTED THAT HONBLE TRIBUNAL HAD PASSED THE ORDER AFTER TAKING INTO ACC OUNT THE LEARNED CIT(A)S ORDER WHO HAD PASSED A VERY REASONED ORDER ON THE B ASIS OF REMAND REPORT OBTAINED FROM ASSESSING OFFICER. THE LEARNED AR INV ITED OUR ATTENTION TO COPY OF REMAND REPORT PLACED AT PB-PAGE 21 TO 50 AN D SUBMITTED THAT THE ASSESSING OFFICER HAD PREPARED A REMAND REPORT RUNN ING INTO 30 PAGES AND HAD VERIFIED EACH AND EVERY ADDITION MADE BY ASSESS ING OFFICER AND THEREFORE, LEARNED CIT(A) HAD PASSED THE ORDER ON T HE BASIS OF REMAND REPORT. HE SUBMITTED THAT IF THE ASSESSING OFFICER IN THE ASSESSMENT ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 3 PROCEEDINGS HAD VERIFIED THE VARIOUS DOCUMENTS IMPO UNDED DURING SURVEY WITH THE BOOKS OF ACCOUNT THE DEPARTMENT SHOULD NOT HAVE ANY GRIEVANCE AGAINST THE CIT(A)S ORDER. HE REITERATED HIS SUBMI SSIONS BEFORE US AND HEAVILY PLACED HIS RELIANCE ON THE ORDER OF LEARNED CIT(A). 5. THE LEARNED DR, ON THE OTHER HAND, HEAVILY PLACE D HIS RELIANCE ON THE ORDERS OF ASSESSING OFFICER. 6. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT IN ASSESSEES APPEAL S IN ITA NOS. 191 &192 (ASR)/2009, THE ISSUE WAS OF VERIFICATION OF STOCK WHICH THE HONBLE TRIBUNAL HAD REMITTED BACK TO THE ASSESSING OFFICER FOR VERI FICATION. AS THE VERIFICATION REQUIRED VERIFICATION OF VARIOUS FIGUR ES. THE TRIBUNAL HAD ALSO DIRECTED THE ASSESSING OFFICER TO TAKE INTO ACCOUNT THE DETAILED SUBMISSIONS OF THE ASSESSEE WHICH INCLUDED THE FACT THAT STOCK LAYING OFF THE TIME OF SURVEY BELONGED TO THREE FIRMS AND NOT ONLY TO TWO FIRMS. FOR THE SAKE OF CONVENIENCE WE REPRODUCE THE FINDINGS OF HONBLE TR IBUNAL AS CONTAINED IN PARA 7 OF THE ORDER. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE AL SO PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS OBSERVED THAT A DETAILED WRITTEN SUBMISSION HAVE BEEN FILED BY THE ASSESSEE BEFORE T HE LD. CIT(A) ON THIS ISSUE, WHICH IS APPARENT FROM THE SUBMISSIONS MADE BY THE LD. COUNSEL FOR THE ASSESSEE. IN THIS REGARD, WE MAY OBSERVE THAT T HE LD. CIT(A), HAS NOT CONSIDERED AND TAKEN INTO ACCOUNT THE DETAILED WRIT TEN SUBMISSIONS FILED BY THE ASSESSEE BEFORE HIM. THE LD. CIT(A), HAS ALSO N OT ASSIGNED ANY REASON WHILE REJECTING THE CLAIM OF THE ASSESSEE. IT IS AL SO APPARENT FROM THE RECORD THAT THE AO AT NO STAGE OF ASSESSMENT HAD REQUIRED THE ASSESSEE OR GIVEN ANY OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE ALLEGED DIFFERENCE IN THE STOCKS WORKED OUT BY HIM. THEREFORE, WE THINK IT PROPER TO SET ASIDE THE ORDER OF THE CIT(A) ON THIS ISSUE. THE SUBMISSIONS MADE BY THE A SSESSEE BEFORE THE CIT(A) HAVE NOT BEEN CONSIDERED PARTICULARLY, WHEN THE ASS ESSEE HAS POINTED OUT THAT THE OUT THAT THE A.O. HAS MADE CLERICAL ERROR BY TAKING FIGURE OF PHYSICAL ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 4 STOCK AT KG 46986 AS AGAINST KG 44051 AS CLAIMED BY THE ASSESSEE. SECONDLY, THE AO HAS TAKEN BALANCE STOCK ON THE DAT E OF SURVEY AS PER THE BOOKS OF TWO FIRMS COVERED UNDER SURVEY AT 28598 KG . HOWEVER, THE BOOK STOCKS OF ABOVE TWO FIRMS AS ON THE DATE OF SURVEY COMES TO RS.32061 KG AS PER THE STOCK TALLY OF TWO FIRMS UPTO THE DATE OF S URVEY, AS CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEE. IN OUR VIEW, THE ABOV E CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE, NEEDS TO BE VERIFIED AND CROSSED CHECKED FROM THE DETAIL OF PHYSICAL INVENTORY PREPARED BY SURVEY PAR TY AT THE TIME OF SURVEY. WE ALSO OBSERVED THAT THE AUTHORITIES BELOW HAVE NO T APPRECIATED THE STATEMENTS OF SH. ARVIND PODDAR AND SH. SUBHASH CHA NDER RECORDED AT THE TIME OF SURVEY OPERATION. IT IS ALSO SEEN THAT THE STATEMENT OF SH. SURINDER SHARMA, EMPLOYEE WAS ALSO RECORDED AT OFFICE CUM SA LE OFFICE. THE AUTHORITIES BELOW HAVE NOT CORRECTLY APPRECIATED THE STATEMENTS OF THE ABOVE NAMED PERSONS. SH. ASHWANI KALIA, THE LD. COUNSEL FOR THE ASSESSEE, ALSO POINTED OUT THAT FROM THE STATEMENTS OF THE ABOVE THREE PER SONS, IT IS PROVED THAT PHYSICAL STOCK AT THE TIME OF SURVEY BELONGED TO TH E THREE FIRMS AND NOT TO TWO FIRMS. WE HAVE ALREADY OBSERVED HEREINABOVE THAT TH E LD. CIT(A) HAS NOT GIVEN ANY COGENT AND CREDIBLE REASON WHILE REJECTING THE SUBMISSIONS OF THE ASSESSEE MADE BEFORE HIM. CONSIDERING THE ENTIRE FA CTS OF THE PRESENT CASE, WE ARE OF THE VIEW THAT THE ISSUE NEEDS TO BE DECID ED AFRESH IN ACCORDANCE WITH LAW AT THE LEVEL OF THE A.O. IT IS ALSO CLAIME D THAT THE BOOKS OF ACCOUNT OF THE ASSESSEE ARE IN THE CUSTODY OF THE DEPARTMENT. WE, THEREFORE, SET ASIDE THE ORDER OF THE CIT(A) ON THIS ISSUE AND REMAND THE SA ME TO THE FILE OF THE A.O. WITH A DIRECTION TO DECIDE THE ISSUE AFRESH IN ACCO RDANCE WITH LAW AFTER AFFORDING DUE AND REASONABLE OPPORTUNITY OF BEING H EARD TO THE ASSESSEE. WE FIND THAT THE HONBLE TRIBUNAL HAD PASSED VERY R EASONED AND SPEAKING ORDER AND THEREFORE, WE DEEM IT APPROPRIATE TO REMI T THE ISSUE TO THE OFFICE OF ASSESSING OFFICER WHO SHOULD DECIDE THE ISSUE AFRES H AFTER KEEPING IN VIEW THE DETAILED SUBMISSIONS FILED BY ASSESSEE BEFORE L EARNED CIT(A). 7. IN VIEW OF THE ABOVE, THE APPEALS FILED BY ASSES SEE ARE ALLOWED FOR STATISTICAL PURPOSES. 8. NOW COMING TO THE APPEALS FILED BY REVENUE, WE F IND THAT THE ISSUES RAISED IN BOTH THE APPEALS ARE SIMILAR WHEREIN THE ASSESSING OFFICER HAD MADE THE ADDITIONS ON ACCOUNT OF FOLLOWING DISCREPA NCIES. (I) ADDITION ON ACCOUNT OF FREE TRADE SAMPLES (II) ADDITION ON ACCOUNT OF INTEROFFICE STOCK TRANS FER ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 5 (III) ADDITION ON ACCOUNT OF GOODS RETURNED SENT ON APPROVAL BASIS (IV) ADDITION ON ACCOUNT OF RAW MATERIAL REJECTION. (V) ADDITION ON ACCOUNT OF SALES MADE OUTSIDE BOOKS OF ACCOUNT & (VI) ADDITION ON ACCOUNT OF INCOME FROM UNDISCLOSED SOURCES. WE FIND THAT ASSESSEE MADE DETAILED SUBMISSIONS BEF ORE LEARNED CIT(A) AND LEARNED CIT(A) SENT THESE SUBMISSIONS TO ASSESSING OFFICER FOR HIS REMAND REPORT. THE ASSESSING OFFICER PREPARED A REMAND REP ORT RUNNING INTO 30 PAGES WHEREIN HE DEALT WITH ALL THE ADDITIONS. WE F URTHER FIND THAT IN THE REMAND PROCEEDINGS HE HAD VERIFIED THE CHALLANS AND OTHER DOCUMENTS WITH THE BOOKS OF ACCOUNTS AND HAS ARRIVED AT THE CONCLU SION THAT ENTRIES WERE VERIFIED IN RESPECT OF FREE TRADE SAMPLES ISSUED TO VARIOUS PARTIES. HE HAD VERIFIED THE SAME FROM THE PARTIES TO WHOM THESE SA MPLES WERE ISSUED. IN RESPECT OF ADDITION ON ACCOUNT OF INTEROFFICE STOCK TRANSFER THE ASSESSING OFFICER HAD MADE THE ADDITION HOLDING THAT THE GOODS WERE TRANSFERRED FROM AMRITSAR TO LUDHIANA FOR SALE WHEREAS HE HAD VERIFI ED IN THE REMAND PROCEEDINGS THAT THE GOODS WERE PURCHASED FROM LUDH IANA AND THEN WERE TRANSFERRED TO AMRITSAR FOR FURTHER PROCESSING. 9. SIMILARLY, IN RESPECT OF GOODS RETURNED THE ASSE SSING OFFICER DURING REMAND PROCEEDINGS HAD VERIFIED FROM THE PARTIES AN D HAD OBTAINED CONFIRMATIONS FROM VARIOUS PARTIES. 10. AS REGARDS A RAW MATERIAL REJECTION THE ASSESSE E HAD FILED CONFIRMATION FORM CONCERNED PARTIES DURING REMAND P ROCEEDINGS WHICH THE ASSESSING OFFICER HAD GOT VERIFIED. ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 6 11. SIMILARLY ADDITION IN RESPECT OF SALES RECORDED OUTSIDE THE BOOKS OF ACCOUNT THE ASSESSING OFFICER DURING REMAND PROCEED INGS HAD VERIFIED THE CHALLANS WITH THE ORIGINAL SALES BILLS AND HAS MENT IONED THE VERIFICATION OF CHALLANS WITH SALES BILLS AT PAGE 36 TO 43 OF THE R EMAND REPORT. THE ASSESSING OFFICER HAD HELD THAT IN MOST CASES IT WA S FOUND THAT ASSESSEE HAS RAISED BILLS SUBSEQUENTLY TO ISSUE OF CHALLANS AND THEY WERE FOUND TO HAVE BEEN RECORDED IN THE SALE REGISTER AND THE SAM E WERE ALSO ENTERED INTO LEDGER ACCOUNT OF RESPECTIVE PARTIES. THE ASSESSING OFFICER DURING REMAND PROCEEDING HAD OBJECTED TO ONLY ONE ISSUE OF NON VE RIFICATION OF SUCH ENTRIES FROM THE STOCK REGISTERS WHICH IS NOT OF MUCH IMPOR TANCE IF THE OTHER RECORDS SUGGEST RECORDING OF TRANSACTIONS. THE LEAR NED CIT(A) AFTER TAKING INTO ACCOUNT ALL THESE FACTS AND CIRCUMSTANCES HAS PASSED A VERY WELL REASONED ORDER AND THE HONBLE TRIBUNAL HAD APPROVE D IT. FOR THE SAKE OF COMPLETENESS WE REPRODUCE THE ORDER OF TRIBUNAL AS CONTAINED IN PARA 13 TO 21.4. 13. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT THE ASSESSEE HAS CATEGOR IZED THE CHALLANS INTO THE FOLLOWING FOUR CATEGORIES: I. FREE TRADE SAMPLES II INTER OFFICE STOCK TRANSFER III GOODS SENT BUT RETURN IV RAW-MATERIAL REJECTION 13.1 IT IS SEEN THAT DURING APPELLATE PROCEEDINGS, THE LD. CIT(A), CALLED FOR REMAND REPORT FROM THE A.O. IN THE REMAND REPORT, T HE AO OBSERVED THAT THE ASSESSEE FILED CONFIRMATION FROM VARIOUS PARTIES IN RESPECT OF THREE FREE TRADE SAMPLES GIVEN TO THEM AS PER CHALLANS. THE A.O. GOT THESE CONFIRMATIONS ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 7 VERIFIED FROM THE PARTIES THROUGH HIS INSPECTOR AND WAS SATISFIED ABOUT THE CORRECTNESS OF THE SAME AND HAS ACCEPTED THIS FACT IN THE REMAND REPORT THAT THERE IS NO DENYING ON THE ACT THAT FREE TRADE SAMP LES ARE GENERALLY GIVEN BY THE ASSESSEE. 13.2 AS REGARDS INTER OFFICE STOCK TRANSFER, THE A.O. IN HIS REMAND REPORT DULY CONFIRMED THAT ON THE CHALLANS IT IS MENTIONED TRANSFER FROM LUDHIANA TO AMRITSAR. FURTHER, THE A.O. ALSO VERIFIED IN DE TAIL THE ENTRY OF PURCHASES IN RESPECT OF THESE CHALLANS FROM THE BOOKS OF LUDH IANA OFFICE. THE A.O. IN HIS REMAND REPORT HAS CONFIRMED THAT PURCHASE IN RE SPECT OF INTER OFFICE STOCK TRANSFER WERE ENTERED AND NARRATION OF GOODS TRANSFER WAS THAT OF RAW- MATERIAL. FURTHER, STOCK TRANSFER FROM LUDHIANA TO AMRITSAR, WAS MENTIONED ON CHALLANS. 13.3. AS REGARDS GOODS RETURNED, THE AO IN HIS REMA ND REPORT HAS CONFIRMED SOME OF THESE CHALLANS DIRECTLY FROM THE PARTIES TO WHOM THE GOODS WERE SENT ON APPROVAL BASIS BUT WERE SENT BACK BY THEM A S THE SAME WERE NOT RETAINED. IT IS ALSO MENTIONED IN THE REMAND REPORT THAT IN SOME CASES THE PARTIES HAVE EITHER CLOSED THE BUSINESS OR HAVE NOT KEPT ANY DETAIL IN RESPECT OF GOODS RETURNED BY THEM HENCE COULD NOT BE VERIFI ED. 13.4. AS REGARDS RAW-MATERIAL REJECTION, THE A.O. I N HIS REMAND REPORT CONFIRMED THAT QUANTITY IN RESPECT OF CHALLAN NOS A ND SALE BILLS HAVE ALREADY BEEN ISSUED. IN VIEW OF THE REMAND REPORT OF THE A. O., THE ID. CIT(A) WAS FULLY JUSTIFIED IN DELETING THE ADDITION. 13.5. FROM THE ABOVE DISCUSSIONS, IT IS CLEAR THAT THE LD. CIT(A), HAS CORRECTLY APPRECIATED THE REMAND REPORT OF THE A.O. AND HAS PASSED A WELL REASONED ORDER AFTER APPRECIATION OF FACTS AND THE COMMENTS OF THE A.O. IN THAT VIEW OF THE MATTER, WE DO NOT SEE ANY MERIT IN THE GROUND RAISED BY THE REVENUE AND DISMISS THE SAME. 14. AS REGARDS GROUND NO.2, THE A.O. MADE THE ADDIT ION OF RS.41,94,773/- ON THE BASIS OF CERTAIN CHALLANS AS PER DETAILS GIV EN ON PAGE 13 & 14 OF THE ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 8 ASSESSMENT ORDER. AS PER DETAIL OF THESE CHALLANS, THE AO HAS COMPUTED THAT 11429.9 KG OF YAM HAS BEEN SOLD OUTSIDE THE BOOKS W HICH VALUED AT RS.41,94,773/- BY APPLYING FLAT RATE OF 367 PER KG. 14.1. ON APPEAL, THE LD. CIT(A), DELETED THE ADDITI ON OF RS.4L,94,773/-. THE RELEVANT FINDINGS OF THE CIT(A) ARE AS UNDER : THE AO IN HIS REMAND REPORT HAD MADE IN-DEPTH EXAM INATION IN RESPECT OF SUBMISSIONS MADE BY APPELLANT AND HAS TH E CHECKED SALE BILLS RAISED BY LUDHIANA OFFICE IN RESPECT OF GOODS RECEIVED FROM AMRITSAR OFFICE VIDE CHALLANS CONFIRMED ON THESE PA PERS. IN ALL THESE CASES HE HAS FOUND THAT SALE BILLS ARE DULY ISSUED AT LUDHIANA OFFICE IN RESPECT OF MATERIAL RECEIVED FROM AMRITSAR OFFICE. MOREOVER THESE DETAIL CONTAIN THE DETAIL OF AND FINISHED GOODS RECEIVED B Y LUDHIANA OFFICE FROM AMRITSAR OFFICE FOR SALE PURPOSES. THE AO HAS TREATED THE TOTAL QUANTITY AS SALE OUTSIDE THE BOOKS IGNORING THE FAC T THAT HUGE SALES MADE AT LUDHIANA OFFICE WHICH ARE DULY ENTERED IN T HE BOOKS OF LUDHIANA OFFICE. THE AO HAS EXAMINED CHALLAN AND HA S ALSO VERIFIED THAT BILLS ARE ISSUED AGAINST THE SAME.. ACCORDINGL Y, THERE IS NOT EVEN IOTA OF DOUBT THAT THESE DETAILS DO NOT REPRESENT A NY SALE OUTSIDE THE BOOKS. THE AO IN HIS REMAND REPORT HQS CONFIRMED TH AT VERIFICATION OF ABOVE CHALLANS WAS MADE. IN MOST OF CASES THE CHALL ANS WERE RAISED BY LUDHIANA OFFICE, SALE BILLS WERE SUBSEQUENTLY IS SUED AND THEY WERE FOUND DULY ENTERED IN THE SALE REGISTER AND HAVE BE EN LEDGRISED IN ACCOUNTS OF PARTIES TO WHOM SALE WAS MADE. FROM THE ABOVE FACTS AND REMAND REPORT OF THE AO IT IS APPARENT THAT ADDITIO N WAS MADE SIMPLY ON THE GROUND THAT THE BOOKS IDENTIFIED DURING THE COURSE OF SURVEY HAS NOT BEEN PRODUCED. ACCORDINGLY, THE SAME IS DELETED . 15. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PEMSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD. CIT(A) HA S DELETED THE ADDITION ON THE BASIS OF REMAND REPORT SUBMITTED B THE A.O. THE LD. CIT(A) HAS CATEGORICALLY STATED THAT THE AO IN HIS REMAND REPO RT HAD MADE IN-DEPTH EXAMINATION IN RESPECT OF SUBMISSIONS MADE BY THE A SSESSEE AND HAS ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 9 CHECKED THE SALE BILLS RAISED BY THE LUDHIANA OFFIC E IN RESPECT OF GOODS RECEIVED FROM AMRITSAR OFFICE VIDE CHALLANS CONFIRM ED ON THESE PAPERS. IN THE REMAND REPORT, THE AO SUBMITTED THAT THE SALE BILLS WERE DULY ISSUED AT LUDHIANA OFFICE IN RESPECT OF MATERIAL RECEIVED FRO M AMRITSAR OFFICE. HE HAS ALSO STATED THAT THESE DETAILS CONTAIN THE DETAIL O F FINISHED GOODS RECEIVED BY LUDHIANA OFFICE FROM AMRITSAR OFFICE FOR SALE PURPO SES. THE AO HAS SUBMITTED IN HIS REMAND REPORT THAT IN MOST OF THE CASES CHALLANS WERE RAISED BY LUDHIANA OFFICE, SALE BILLS WERE SUBSEQUE NTLY ISSUED AND THEY WERE DULY ENTERED IN THE SALE REGISTER AND HAVE BEEN LED GERISED IN ACCOUNTS OF PARTIES TO WHOM THE SALE WAS MADE. 15. IN OUR VIEW, THE ID. CIT(A) HAS CORRECTLY OBSER VED THAT THE ADDITION WAS MADE SIMPLY ON THE GROUND THAT THE BOOKS WERE IDENT IFIED DURING THE COURSE OF SURVEY HAS NOT BEEN PRODUCED. WE FIND THAT DURIN G THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE CIT(A), THE ASSESSEE HAS PRO DUCED CHALLAN BOOKS AND SALE BILLS RAISED AT AMRITSAR OFFICE AS WELL AS THE SALE BILLS RAISED AT LUDHIANA OFFICE. CONSIDERING THE ENTIRE FACTS AND CIRCUMSTAN CES OF THE PRESENT CASE, WE DO NOT SEE ANY VALID GROUND TO INTERFERE WITH TH E ORDER OF THE CIT(A) ON THIS ISSUE. ACCORDINGLY, WE UPHOLD THE SAME AND DIS MISS GROUND NO.2 OF THE APPEAL OF THE REVENUE. 16. VIDE GROUND NO.3, THE REVENUE HAS CHALLENGED TH E ADDITION OF RS. 11,19,773/-, RS.7,26,552/-, RS. 11,464/- & RS.2,18, 510/- BEING SALES FOUND TO HAVE BEEN MADE OUTSIDE THE BOOKS OF ACCOUN T. 16.1. ON APPEAL, THE LD. CIT(A), DELETED THE ABO VE ADDITIONS. AS REGARDS ADDITION OF RS. 11,19,523/-, THE CIT(A) HELD THAT T HE ADDITION IS NOT SUSTAINABLE IN LAW ON THE BASIS OF REMAND REPORT OF THE A.O. THE REMAND REPORT SUBMITTED BY THE AO READS AS UNDER: THIS PAPER WAS FOUND IN ASSESSEES PREMISES AND TH E ASSESSEE HAS REFERRED THE SAME TO BE PERTAINING TO SIV INDUSTRIE S ACCOUNT OF PODDAR SYNTHETICS PVT. LTD. DUE OPPORTUNITY WAS AVAILABLE WITH THE ASSESSEE BETWEEN 19.3.2004 (WHEN REPLY WAS FILED) AND 26.3.2 004 WHEN THE ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 10 CASE WAS FINALLY HEARD). HOWEVER, THE ASSESSEE DID NOT PRODUCE ANY EVIDENCE TO SUPPORT THE STAND TAKEN BY HIM. IN THE ASSESSMENT ORDER ITSELF IT IS MENTIONED THUS NET SUM OF RS.L 1,19,5 23/- IS TREATED AS SALE OUT OF BOOKS OF ACCOUNT AND ADDED BACK SUBJECT TO V ERIFICATION. EVEN AFTER THE COMPLETION OF ASSESSMENT THE ASSESSEE DID NOT COME FORWARD WITH APPLICATION U/S 154 AND GET THE ENTRY VERIFIED . DURING REMAND PROCEEDINGS THE ASSESSEE HAS PRODUCED ORIGINAL BILL OF SIV INDUSTRIES, ITS BANK STATEMENT FOR THE RELEVANT ENTRY AND THE N ATURE OF TRANSACTION I.E. PURCHASE. THE ENTRY RS.L 1,19,523 APPEARING AS DEBIT ON 9.9.2000 IN PODDAR SYNTHETICS IS VERIFIED FROM THE BOOKS OF ACCOUNT OF M/S. PODDAR SYNTHENTICS PVT. LTD. PRODUCED. 16.1 THE LD. CIT(A), DELETED THE ADDITION OBSERVING AS U NDER: FROM THE WRITTEN SUBMISSIONS OF THE APPELLANT AND REMAND REPORT OF THE AO, IT IS APPARENT THAT THE PAPER HAS NO BEARIN G TO APPELLANT BUT THE APPELLANTS SISTER CONCERN M/S. PODDAR SYNTHETI CS PVT. LTD. AND SAME IS DULY ACCOUNTED FOR THAT PARTY AS VERIFIED B Y THE AO DURING COURSE OF REMAND PROCEEDINGS. IN VIEW OF THESE FACT S, THE ADDITION IS DELETED. 16.2. IN VIEW OF THE REMAND REPORT OF THE AO, WE AR E OF THE VIEW THAT THE CIT(A) WAS FULLY JUSTIFIED IN DELETING THE ADDITION . IT IS SEEN THAT THE A.O. HAS MADE THE ADDITION WITHOUT BRINGING ANY SUPPORTING E VIDENCE ON RECORD.. WE, THEREFORE, UPHOLD THE ORDER OF THE CIT(A) IN DELETI NG THE ADDITION OF RS. 11,19,523/-. 17. THE ID. CIT(A) ALSO DELETED THE ADDITION OF RS. 7,26,552/- ON THE BASIS OF REMAND REPORT SUBMITTED BY THE A.O. THE CONCLUDING PARA OF THE REMAND REPORT SUBMITTED ON THIS ISSUE READS AS UNDER: THE ASSESSEE HAS TALLIED THE WEIGHT ON THE CHALLAN WITH THE BILLS RAISED TO SEVERAL PARTIES WHERE THE CHALLAN NO. IS MENTIONED. THE TOTAL WEIGHT ON CHALLAN TALLIED WITH THE TOTAL WEIGHT OF GOODS ISSUED TO THESE ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 11 PARTIES THROUGH THE SAME CHALLAN. THOSE SALES HAVE BEEN VERIFIED FROM THE BOOKS OF ACCOUNT IMPOUNDED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. CONFIRMATION IN THIS REGARD FROM THE P ARTIES HAS ALSO BEEN MADE. 17.1. ON THE BASIS OF ABOVE REMAND REPORT, THE CIT(A) OBS ERVED THAT THERE WAS NO JUSTIFICATION FOR MAKING THE ADDITION OF RS. 7,26,552/- BY THE AO. 17.2 IN OUR VIEW, THE LD. CIT(A), WAS FULLY JUSTIFIED IN DELETING THE ADDITION ON THE BASIS OF REMAND REPORT SUBMITTED BY THE AO. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE CIT(A), THE ASSESSEE SUBMITTED DETAILS OF CHALLAN NO. DATE AND QUANTITY AND CORRESPONDING SALE BILL, DATE AND QUANTITY SOLD AGAINST THESE CHA LLANS. THE LD. CIT(A) FOUND THAT ALL THE SALE BILLS WERE DULY RECORDED IN THE BOOKS OF ACCOUNT AND HE, THEREFORE, HELD THAT THERE CAN BE N O REASON FOR MAKING THE ADDITION. CONSIDERING THE ENTIRE FACT AN D CIRCUMSTANCES OF THE PRESENT CASE AND ALSO THE REMAND REPORT SUBM ITTED BY THE AO, WE ARE OF THE VIEW THAT THERE WAS NO JUSTIFICATION IN MAKING THE ADDITION OF RS.7,26,552/-. ACCORDINGLY, WE UPHOLD T HE ORDER OF THE CIT(A). 18. THE LD. CIT(A) ALSO DELETED THE ADDITION OF RS. 11, 464/- ON THE BASIS OF REMAND REPORT SUBMITTED BY THE A.O. IN THE REMAND R EPORT IT WAS SUBMITTED THAT THE ADDITION WAS WRONGLY MADE BECAUS E FIRSTLY ALL THE PAPERS DO NOT PERTAIN TO THE PERIOD UNDER ASSESSMEN T AND SECONDLY THE SAME WAS DULY ACCOUNTED FOR IN THE BOOKS FOR TH E RELEVANT ASSESSMENT YEAR. 18.1. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUS ED THE MATERIALS AVAILABLE ON RECORD. IN OUR VIEW, THE LD. CIT(A) HA S CORRECTLY DELETED THE ADDITION ON THE BASIS OF REMAND REPORT SUBMITTE D BY THE A.O. WE, THEREFORE, DO NOT SEE ANY GROUND TO INTERFERE WITH THE ORDER OF THE CIT(A) ON THIS ISSUE. ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 12 19. WHILE FRAMING THE ASSESSMENT, THE AO MADE AN ADDIT ION OF RS.2,18,510/- ON THE BASIS OF LOOSE PAPER. 19.1. ON APPEAL, THE LD. CIT(A) DELETED THE ADDITIO N ON THE BASIS OF REMAND REPORT SUBMITTED BY THE AO. THE LD. CIT(A), HAS CAT EGORICALLY STATED THAT THE AO HAS EXAMINED THE SALE BILLS WHICH PERTAIN TO THE ACCOUNT OF THE PARTY IN THE BOOKS OF THE ASSESSEE . THE ID. CIT(A) FURTHER OBSERVED THAT ALL THE ENTRIES APPEARING IN ROUGH LIST HAS BEEN VERIFIED B Y THE AO AND CONFIRMED THE SAME IN HIS REMAND REPORT. 19.2 AFTER HEARING THE LEARNED REPRESENTATIVES O F BOTH THE PARTIES, WE ARE OF THE VIEW THAT THE CIT(A) WAS FULLY JUSTIFIED IN DELETING THE ADDITION OF RS.2,18,510/- MADE BY THE AO ON THE BASIS OF LOOSE PAPER. THE ORDER OF THE CIT(A) IS BASED ON THE REMAND REPORT SUBMITTED BY T HE AO. IN OUR VIEW, THERE SHOULD HAVE NOT BEEN ANY GRIEVANCE TO THE REV ENUE AGAINST THE ORDER OF THE CIT(A) ON THIS ISSUE, PARTICULARLY, WHEN THE FINDINGS ARE BASED ON THE REMAND REPORT SUBMITTED BY THE AO. CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES OF THE CASE, WE DO NOT SEE ANY VALID GROUND IN INTERFERING WITH THE ORDER OF THE CIT(A) ON THIS ISSUE. IN VIEW OF T HE ABOVE, WE DISMISS GROUND NO.3 OF THE REVENUES APPEAL. 20. VIDE GROUND NO.4 OF THE APPEAL, THE REVENUE HAS CHALLENGED THE ORDER OF THE CIT(A) IN DELETING THE ADDITION OF RS.86,041/- AND RS.41,312/-. WHILE FRAMING ASSESSMENT, THE AO MADE THE ADDITION OF RS. 86041/- ON THE BASIS OF ROUGH PAPER MARKED AS PAGE 1. THE ASSESSEE EXPLA INED THAT THIS PAPER CONTAINS THE DETAIL OF UGRAHI TO BE MADE FROM VARIO US PARTIES TO WHOM GOODS WERE SOLD. HOWEVER, THE AO DID NOT FIND ANY MERIT I N THE EXPLANATION OF THE ASSESSEE AND MADE THE ADDITION OF RS.86,041/-. 20.1 ON APPEAL, THE ID. CIT(A) DELETED THE ADDITION ON THE BASIS OF REMAND REPORT SUBMITTED BY THE AO. THE CIT(A) HAS CATEGORI CALLY STATED THAT IN HIS REMAND REPORT, THE AO HAS ALSO VERIFIED THESE FACTS AND CONFIRMED THAT SALE IN RESPECT OF THE BILLS ARE DULY RECORDED IN THE SA LE REGISTER AND DEBITED TO PARTYS ACCOUNT IN LEDGER. THE CIT(A) ALSO OBSERVED THAT PAYMENT RECEIVED FROM PARTIES HAS ALSO BEEN RECORDED IN THE PARTYS ACCOUNT IN LEDGER. SINCE ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 13 THE ABOVE PAPER CONTAINED DETAIL OF UGRAHI AS PER T HE LEDGER, NO ADDITION WAS CALLED FOR IN RESPECT OF THE SAME. ACCORDINGLY, CIT (A) DELETED THE ADDITION. 20.2 AFTER HEARING THE LEARNED REPRESENTATIVES OF B OTH THE PARTIES, WE DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF THE CIT(A) ON THIS ISSUE. THE CIT(A) HAS DELETED THE ADDITION AFTER APPRECIATING THE CONTENT S OF REMAND REPORT SUBMITTED BY THE AO ON THIS ISSUE. THE CIT(A) HAS C ATEGORICALLY STATED IN HIS ORDER THAT THE SALE IN RESPECT OF THE BILLS WERE RE CORDED IN THE SALE REGISTER AND DEBITED TO PARTYS ACCOUNT. PAYMENT RECEIVED FR OM THE PARTIES WERE ALSO RECORDED IN THE PARTYS ACCOUNT IN THE LEDGER.ACCOR DING TO THE CIT(A), THE ROUGH PAPER CONTAINED ONLY THE DETAIL OF UGRAHI, AS PER THE LEDGER, NO ADDITION WAS CALLED FOR IN RESPECT OF SAME. CONSIDE RING THE ENTIRE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, WE UPHOLD THE OR DER OF THE CIT(A). 21. THE AO ALSO MADE THE ADDITION OF RS.41,312/- ON THE BASIS OF ONE LOOSE PAPER FOUND DURING THE COURSE OF SURVEY AT LUDHIANA OFFICE. 21.1. BEFORE THE CIT(A), THE ASSESSEE TOOK THE PLEA THAT THE SAID PAPER WAS NOT WRITTEN BY THE ASSESSEE OR ANY OF HIS EMPLOYEE. IT WAS ALSO CLAIMED BEFORE THE CIT(A) THAT THE SAID PAPER WAS UNDATED A ND TO WHICH PERIOD IT PERTAINED WAS ALSO NOT THERE. THE PAPER DID NOT BEA R ANY NAME OR ADDRESS AND EVEN DID NOT INDICATE WHETHER THE FIGURE WRITTE N ON THE PAPER PERTAINED TO RECEIPT OR PAYMENT. THE ASSESSEE ALSO SUBMITTED BEFORE THE CIT(A) THAT DURING THE COURSE OF SURVEY, THE SURVEY PARTY HAD N OT COME ACROSS ANY BANK ACCOUNT OR ANY INVESTMENT WHICH WAS NOT RECORDED IN THE BOOKS. ACCORDINGLY, IT WAS SUBMITTED THAT NO ADDITION CAN BE MADE ON SUCH DUMB AND TRASH PAPER. 21.1. THE LD. CIT(A), DELETED THE ADDITION OBSERVING AS UNDER: FROM THE PERUSAL OF THIS PAPER I HAVE ABSOLUTELY N O DOUBT THAT IT IS A ROUGH PAPER ON WHICH THERE IS NO MENTION OF ANY NAM E, DATE, OR ADDRESS. THE APPELLANT HAS ALSO STATED THAT IT WAS NOT WRITTEN BY THE APPELLANT OR ANY OF HIS EMPLOYEE. ACCORDINGLY, NO ADDITION CAN BE MADE ON THE STRENGTH OF SUCH DUMB PAPER, ESPECIALLY KEEPING IN VIEW THE ABOVE REASONS. THE ADDITION MADE IS, THUS, DELE TED. ITA NOS.256 &191 & 257 &192 (ASR)/2009 ASST. YEAR: 2001-02 14 21.3. AFTER HEARING THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, WE DO NOT FIND ANY MERIT IN THE GROUND RAISED BY THE REVE NUE. THERE IS NO MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF THE CIT(A) AND ACCORDINGLY, WE UPHOLD THE SAME. 21.4. IN VIEW OF THE ABOVE, GROUND NO.4 OF THE AP PEAL IS DISMISSED. THE ORDER OF HONBLE TRIBUNAL IS BASED UPON THE FAC T THAT ASSESSING OFFICER DURING REMAND PROCEEDINGS HAD VERIFIED ALL THESE DI SCREPANCIES FOUND DURING SURVEY WHICH THE ASSESSING OFFICER HAD ALSO CONFIRMED IN HIS REMAND REPORT. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LEARNED CIT(A). 12. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES TH E APPEALS FILED BY REVENUE ARE DISMISSED. 13. IN NUTSHELL, THE APPEALS FILED BY THE ASSESSE E ARE ALLOWED FOR STATISTICAL PURPOSES WHEREAS THE APPEALS FILED BY THE REVENUE A RE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 .07.2016. SD/- SD/ - (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:15.07.2016. /PK/PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER