M/s. Shree Jalaram Industries, Dist.Ahmedabad V. The Income tax Officer,Ward-6(3), Ahmedabad

ITA 2172/AHD/2007

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 85863 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 year(s) 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 29-01-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 22-05-2007
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Gross profit estimation; Unexplained cash credit; Rejection of books of accounts; Unexplained investment; Business income; Income from undisclosed sources
• Section: 43B; 133A; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMEDABAD , BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI N. S. SAINI, ACCOUNTANT MEMBER. ITA. NO. 2144/AHD/2007 (ASSESSMENT YEAR:2002-03) THE INCOME-TAX OFFICER, WARD-6(3), C.U. SHAH COLLEGE BUILDING, 1 ST FLOOR, ASHRAM ROAD, AHMADABAD 380014 APPEL LANT VS. M/S. SHREE JALARAM INDUSTRIES 264/265, GIDC, HANSALPUR, VIRAMGAM, DIST. AHMADABAD RESPONDENT & ITA. NO. 2172/AHD/2007 (ASSESSMENT YEAR:2002-03) M/S. SHREE JALARAM INDUSTRIES 264/265, GIDC, HANSALPUR, VIRAMGAM, DIST. AHMADABAD APPELLANT VS. THE INCOME-TAX OFFICER, WARD-6(3), C.U. SHAH COLLEGE BUILDING, 1 ST FLOOR, ASHRAM ROAD, AHMADABAD 380014 RESPONDENT PAN: AATFS0453Q I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 2 / BY REVENUE :SHRI ROOPCHAND, SR. D.R. / BY ASSESSEE : SHRI ASEEM L. THAKKAR, A.R. /DATE OF HEARING :29.01.2015 !' /DATE OF PRONOUNCEMENT :27.03.2015 ORDER PER SHAILENDRA KUMAR YADAV, J.M: THESE CROSS APPEALS ARE ARISING OUT FORM THE ORDER OF CIT(A)-XVI, AHMEDABAD, DATED 31.01.2007 FOR THE ASS ESSMENT YEAR 2002-03. SO, THEY ARE BEING DISPOSED OF BY WA Y OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. IN ITA NO. 2144/AHD/2007, REVENUE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS: 1. THE LD. COMMISSIONER OF INCOME TAX (A) - XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE OF RS. 5,93,853/- ON ACCOUNT OF SALES OF CATTLE FEED. 2. THE LD. COMMISSIONER OF INCOME TAX (A) - XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE OF RS. 1,23,987/-ON ACCOUNT OF UNACCOUNTED PURCHASE OF KAPAS SHANKAR (COTTON 'SHANKAR'). 3. THE LD. COMMISSIONER OF INCOME TAX (A) - XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE OF RS.71,89,691/-ON ACCOUNT OF UNACCOUNTED PURCHASE OF SHANKAR KAPASIYA (COTTON SEEDS). I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 3 4. THE LD. COMMISSIONER OF INCOME TAX (A)-XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE-OF RS. 1,65,231/- ON ACCOUNT OF UNACCOUNTED PURCHASE OF KALYAN KAPAS. 5. THE LD. COMMISSIONER OF INCOME TAX (A)-XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DIRECTIN G THE ASSESSING OFFICER TO COMPUTE THE PROFIT ON SALE OF COTTON BALES AND MAKE THE ADDITION OF THE PROFIT THEREON AND NOT THE ENTIRE SALE ITSELF I.E. RS. 27,71,015/-. 6. THE LD. COMMISSIONER OF INCOME TAX (A) - XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE OF RS. 8,10,665/- ON ACCOUNT OF UNACCOUNTED SALE OF KALA BY CLUBBING THE INCOME OF RAGHUVIR COTTON COMPANY. 7. THE LD. COMMISSIONER OF INCOME TAX (A) - XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE OF RS. 11,16,568/-ON ACCOUNT OF UNEXPLAINED STOCK DIFFERENCE OF COTTON AND COTTON SEEDS. 8. THE LD. COMMISSIONER OF INCOME TAX (A) - XVI, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE OF RS. 3,47,181/- ON ACCOUNT OF DISALLOWANCE OF UNPAID SALES TAX UNDER SECTION 43B OF THE INCOME TAX ACT, 1961. 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. COMMISSIONER OF INCOME TAX (A) -XVI, AHMEDABAD OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER. 10. IT IS THEREFORE PRAYED THAT THE ORDER OF THE LD . COMMISSIONER OF INCOME TAX (A) - XVI, AHMEDABAD MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 4 2.1 IN ITA NO. 2172/AHD/2007, ASSESSEE HAS FILED TH E APPEAL ON THE FOLLOWING GROUNDS: 1. THE LEARNED COMMISSIONER OF INCOME TAX (A) HAS ERRED IN CONFIRMING THE REJECTION OF BOOK RESULTS U/S.145(3) OF THE I.T. ACT, 1961. 2. THE LEARNED COMMISSIONER OF INCOME TAX (A) HAS ERRED IN CONFIRMING AN ADDITION OF RS. 19,63, 297/- MADE BY ASSESSING OFFICER FOR THE ALLEGED LOW G.P. 3. THE LEARNED COMMISSIONER OF INCOME TAX (A) HAS E RRED IN GIVING DIRECTION TO COMPUTE THE PROFIT ON THE SA LE OF COTTON BALES AND MAKE ADDITION OF THE PROFIT ON SAL E OF THE COTTON BALES AND NOT THE ENTIRE SALE ITSELF. HE THEREBY ERRED IN RETAINING THE ADDITION IN PART OUT OF RS.27,71,015/- MADE BY THE A.0. 4. THE LEARNED COMMISSIONER OF INCOME TAX (A) HAS E RRED IN CONFIRMING AN ADDITION OF RS.4,61,445/- MADE BY THE A.O. FOR ALLEGED UNEXPLAINED CASH CREDITS AS UNDER:- 1. JAYANTIBHAI DALSUKH RS.1,11,587/- 2. GAJIBHAI BHAGWANBHAI RS. 99,858/- 3.. DHIRUBHAI AMBARAM RS.1,00,000/- 4. LAGHRABHAI RATUBHAI RS.1,00,000/- 5. L.ALUBHAI. GAJUBHAI RS. 50,000/- RS.4,61,445/- 3. ASSESSEE IS ENGAGED IN THE BUSINESS OF KAPAS. F ACTS IN THIS ISSUE ARE THAT RETURN DECLARING NIL WAS FILED ON 30.10.2002. A SURVEY U/S. 133A WAS CARRIED OUT IN THIS CASE ON 30.01.2002. DURING SURVEY BOOKS OF ACCOUNT AND DOCUMENTS WERE IMPOUNDED. STATEMENT OF SHRI THAKAR SHIBHAI THAKKAR MAIN PARTNER OF ASSESSEE FIRM WAS RECORDED. THE MAIN PARTNER HAS ADMITTED THAT NO RECORD IS MAINTAI NED FOR I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 5 SENDING RAW MATERIAL IE. KAPAS FOR GINNING, NO PROD UCTION RECORD IS MAINTAINED AND NO PHYSICAL STOCK HAS BEEN TAKEN AT THE END OF YEAR. ASSESSING OFFICER FURTHER STATED THAT BOOKS OF ACCOUNT WERE FOUND TO BE INCOMPLETE DURING SURVEY. IN THE IMPOUNDED BOOKS ENTRIES HAVE NOT BEEN MADE FOR MONT HS. IN THE CASH BOOK NO OPENING AND CLOSING BALANCES WERE MENTIONED. DURING SURVEY ASSESSEE WAS ASKED BY ASS ESSING OFFICER TO FURNISH INFORMATION WITH REGARD TO PURCH ASES, SALES AND CLOSING STOCK WHICH WAS THE PRIMARY DATA. ASSES SEE SUBMITTED THESE DETAILS WHICH DIFFER FROM DETAILS S UBMITTED DURING ASSESSMENT PROCEEDINGS FOR THE SAME PERIOD. ASSESSING OFFICER FOUND THAT THERE WAS DIFFERENCE IN PURCHASE S, SALES AND CLOSING STOCK. HE CONCLUDED THAT PRIMARY DATA AND OTHER DOCUMENTS HAVE BEEN PREPARED ARTIFICIALLY. HE REJE CTED BOOK RESULTS OF ASSESSEE ON THE GROUNDS THAT SALES AND P URCHASES WERE NOT REFLECTED CORRECTLY IN PRIMARY BOOKS OF AC COUNT, PRODUCTION REGISTER AND STOCK REGISTER WERE NOT PRE PARED WHICH IS BASIC REQUIREMENT IN MANUFACTURING UNIT AND BOOK S OF ACCOUNT PREPARED AFTER SURVEY DO NOT REFLECT CORREC T AND COMPLETE FINANCIAL AFFAIRS OF ASSESSEE. 3.1 ASSESSING OFFICER AFTER REJECTING BOOKS OF ACCO UNT ESTIMATED GROSS PROFIT RATE OF VARIOUS ITEMS BASED ON YIELD AS STATED BY MAIN PARTNER OF ASSESSEE DURING SURVEY AN D BY TAKING AVERAGE PURCHASE RATES OF DIFFERENT ITEMS AN D SALE RATES OF DIFFERENT ITEMS. IN HIS STATEMENT SHRI THAKKAR THE MAIN PARTNER STATED THAT 100 KGS OF KALA YIELDS 70 KG OF KAPAS AND I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 6 70 KGS OF KAPAS YIELDS 28 KGS OF COTTON AND 42 KGS OF COTTON SEEDS. ON THE BASIS OF THESE CALCULATIONS ASSESSING OFFICER HAS WORKED OUT GROSS PROFIT RATE OF KALA KAPAS AT 7.36% , KALYAN KAPAS 24.6%, OIL & CATTLE FEED AT 62.71%. ON PURCH ASE, SALE AND CLOSING STOCK FIGURES OF VARIOUS ITEMS FURNISHE D BY ASSESSEE DURING ASSESSMENT PROCEEDINGS ASSESSING OF FICER COMPUTED GROSS PROFIT AT RS. 37,24,780/-. ASSESSEE HAS SHOWN GROSS PROFIT OF RS. 17,61,483/-. ASSESSING OFFICER THEREFORE MADE ADDITION OF RS. 19,63,297/- ON ACCOUNT OF LOW GROSS PROFIT BEING DIFFERENCE IN GROSS PROFIT COMPUTED BY ASSESSING OFFICER AND GROSS PROFIT DECLARED BY ASSESSEE. 3.2 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE A UTHORITY ON THIS POINT WHO HAVING CONSIDERED THE ARGUMENT OF AS SESSEE OBSERVED THAT ASSESSING OFFICER HAS REJECTED BOOKS RESULT ON THE GROUND THAT NO STOCK/ PRODUCTION REGISTER WAS M AINTAINED. BOOKS OF ACCOUNT WERE NOT COMPLETED AND PHYSICAL ST OCK WAS NOT TAKEN AT THE END OR YEAR. TRANSACTIONS WERE NO T ENTERED IN BOOKS OF ACCOUNTS FOR MONTHS. CASH BOOK DID NOT RE FLECT OPENING AND CLOSING BALANCES. THERE WAS DISCREPANC Y WITH REGARD TO SALES/PURCHASES AND CLOSING STOCK BETWEEN FIGURES GIVEN BY ASSESSEE DURING COURSE OF SURVEY PROCEEDIN GS AND DETAILS SUBMITTED DURING ASSESSMENT PROCEEDINGS. I N THIS REGARD, THE MAIN STAND OF ASSESSEE HAS BEEN THAT AS SESSING OFFICER HAS NOT POINTED OUT ANY SPECIFIC DEFECTS IN BOOKS OF ACCOUNTS AND HAS NOT POINTED OUT ANY INSTANCE OF SU PPRESSION OR INFLATION OF EXPENSES. AS REGARDS DISCREPANCIES IN PURCHASE I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 7 AND SALE, ASSESSEE HAS STATED THAT IT HAS HIGH SALE S IN BOOKS OF ACCOUNT FOR THE PERIOD UP TO THE DATE OF SURVEY THA N WHAT WAS FURNISHED AT THE TIME OF SURVEY. THE BOOKS OF ACCO UNT COULD NOT BE COMPLETED AS IT WAS THE MIDDLE OF BUSINESS S EASON. CONSIDERING THESE ASPECTS, THE ASSESSING OFFICER WA S RIGHT IN REJECTING BOOKS U/S. 145(3) SINCE ASSESSEE HAS NOT MAINTAINED ANY STOCK REGISTER/PRODUCTION REGISTER AND BOOKS OF ACCOUNTS WERE INCOMPLETE. THERE WAS DISCREPANCY IN FIGURE O F SALE/PURCHASES FURNISHED BY ASSESSEE AT THE TIME OF SURVEY AND FURNISHED DURING COURSE OF ASSESSMENT PROCEEDIN G. ASSESSING OFFICER HAS POINTED OUT THE DEFECTS IN MA INTENANCE OF BOOKS OF ACCOUNTS. THE ARGUMENT OF ASSESSEE THAT B OOKS OF ACCOUNTS COULD NOT BE COMPLETED SINCE IT WAS MIDDLE OF THE SEASON HAS NO FORCE. ASSESSEE HAS MAINTAINED INWARD/OUTWARD REGISTER, SOUDA BOOKS AND BILL BOOKS . THERE WAS NO DIFFICULTY IN MAINTAINING THE BOOKS OF ACCOU NTS. ASSESSEE NOT HAVING COMPLETED THE BOOKS ON REGULAR BASIS HAS RESULTED IN DIFFERENCE IN DATA FURNISHED DURING SUR VEY AND SUBSEQUENTLY DURING ASSESSMENT PROCEEDINGS. ASSESS EE IS EXPECTED TO COMPLETE BOOKS OF ACCOUNT ON REGULAR BA SIS, WHICH HAS NOT BEEN DONE IN THIS CASE. IN VIEW OF DISCREP ANCY POINTED OUT BY ASSESSING OFFICER, BOOKS OF ACCOUNT OF ASSES SEE WERE NOT RELIABLE. HE HAS RIGHTLY REJECTED THE BOOKS OF ACC OUNT U/S. 145(3). THIS REASONED FINDING OF CIT(A) NEEDS NO I NTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 8 3.3 REGARDING ADDITION OF RS.19,63,297/- MADE BY AS SESSING OFFICER ON ACCOUNT OF LOW GROSS PROFIT RATE, WE FIN D THAT ASSESSING OFFICER HAS COMPUTED GROSS PROFIT RATE OF VARIOUS ITEMS DEALT WITH BY ASSESSEE ON THE BASIS OF RECORD S OF ASSESSEE, NORMS OF INDUSTRY AND STATEMENT OF MAIN P ARTNER OF ASSESSEE FIRM. ASSESSING OFFICER THEN APPLIED GROS S PROFIT RATE SO COMPUTED ON SALE OF VARIOUS ITEMS TO COMPUTE GRO SS PROFIT RATE OF ASSESSEE. THE SALE FIGURES GIVEN BY ASSESS EE DURING ASSESSMENT PROCEEDINGS WERE ADOPTED BY ASSESSING OF FICER. GROSS PROFIT COMPUTED BY ASSESSING OFFICER IS RS.37 ,24,780/-. AFTER REDUCING GROSS PROFIT DECLARED BY ASSESSEE AM OUNTING TO RS.17,61,483/-. ASSESSING OFFICER MADE ADDITION OF RS.19,63,297/- ON ACCOUNT OF LOW GROSS PROFIT RATE. UNDER FACTS AND CIRCUMSTANCES, CIT(A) WAS JUSTIFIED IN UP HOLDING THE REJECTION OF BOOKS OF ACCOUNTS AS DISCUSSED ABOVE A ND HAVING DONE SO, CIT(A) WAS JUSTIFIED IN SUSTAINING ADDITIO N OF RS.19,63,297/- MADE ON ACCOUNT OF LOW GROSS PROFIT RATE. THIS REASONED FINDING OF CIT(A) NEEDS NO INTERFERENCE FR OM OUR SIDE. WE UPHOLD THE SAME. 4. VARIOUS OTHER ADDITIONS MADE BY ASSESSING OFFICE R ARE BEING DEALT AS UNDER: 4.1 FIRST ISSUE AS RAISED IN REVENUES APPEAL IS WI TH REGARDS TO ADDITION OF RS.5,93,832/- ON ACCOUNT OF UNACCOUN TED SALE OF CATTLE FEED. ASSESSING OFFICER HAS MADE ADDITION O F RS.21,150/- ON ACCOUNT OF BOGUS SALE OF 50 BAGS OF CATTLE FEED, ADDITION OF RS.1,23,021/- ON ACCOUNT OF SALE RECORD ED IN BILL I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 9 BOOK BUT NOT ENTERED IN REGULAR BOOKS OF ACCOUNT AN D ADDITION OF RS.4,49,682/- ON ACCOUNT OF SALE OF CATTLE FEED WHICH WAS ENTERED IN SALE NOTE BOOKS BUT FOR WHICH BILLS HAVE NOT BEEN PREPARED AND ENTERED IN THE BOOKS OF ACCOUNT. AS R EGARDS THE ADDITION OF RS.21,150/- AND RS.1,23,021/-, CIT(A) O BSERVED THAT THESE SALES HAVE BEEN RECORDED IN BOOKS OF ACC OUNT PRODUCED DURING ASSESSMENT PROCEEDINGS AND ASSESSIN G OFFICER HAS ALREADY TAKEN INTO ACCOUNT SALES DISCLOSED BY A SSESSEE DURING ASSESSMENT PROCEEDING FOR MAKING GROSS PROFI T ADDITION. THEREFORE, ADDITION ON ACCOUNT OF THESE SALE SHOULD NOT BE MADE. AS REGARDS ADDITION OF RS.4,49,682/-, CIT(A) OBSERVED THAT THESE SALES PERTAINED TO M/S. RAGHUVIR COTTON CO. AND HAVE BEEN INCLUDED IN TURNOVER OF SAID CONCERN. SI NCE SAID CONCERN HAS FILED SEPARATE RETURN OF INCOME ASSESSI NG OFFICER WAS NOT JUSTIFIED IN MAKING ADDITION ASSESSEES HAN DS. ACCORDINGLY, ADDITION OF RS.5,93,853/- WAS RIGHTLY DELETED BY CIT(A). THIS REASONED FACTUAL FINDING OF CIT(A) NE EDS NO INTERFERENCE FROM OUR SIDE. 4.2 NEXT ISSUE AS RAISED IN REVENUES APPEAL IS WIT H REGARDS TO ADDITION OF RS.1,23,987/- ON ACCOUNT OF UNACCOUNTED PURCHASE OF KAPAS SHANKER. ASSESSING OFFICER MENTIONED THAT AS PER AVAK-JAVAK REGISTER X-13, PURCHASE OF KAPAS SHANKER WAS MORE THAN WHAT WAS SHOWN IN PURCHASE ACCOUNT OF LED GER ITEM NO.6. ASSESSING OFFICER COMPUTED COTTON PRODUCED F ROM KAPAS AND ESTIMATED UNACCOUNTED SALE OF COTTON OF RS.1,23 ,987/-. STAND OF ASSESSEE HAS BEEN THAT COPY OF PURCHASE AC COUNT WAS I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 10 FURNISHED DURING COURSE OF SURVEY AS PER WHICH TOTA L QUANTITY PURCHASED WAS 53833 KG AND THERE WAS A DIFFERENCE O F ONLY 4 KG WHICH WAS NEGLIGIBLE. ASSESSING OFFICER HAS CHO SEN NOT TO ACCEPT PURCHASE ACCOUNT IN WHICH QUANTITY RECORD HA VE BEEN MADE. IT WAS ALSO STATED ON BEHALF OF ASSESSEE THA T ALL PURCHASES SO RECORDED WERE DULY SUPPORTED BY PURCHA SE BILLS AND WERE IN AGREEMENT WITH THE DATA CONTAINED IN IM POUNDED BOOKS AND THERE WAS NO REASON THAT SAME BE TREATED AS UNACCOUNTED. IN THIS BACKGROUND, CIT(A) RIGHTLY O BSERVED THAT THESE PURCHASES ARE ACCOUNTED FOR. ASSESSING OFFI CER HAS NOT MENTIONED ANYTHING IN REMAND REPORT AGAINST ARGUMEN TS OF COUNSEL. ACCORDINGLY, CIT(A) RIGHTLY ACCEPTED THE CONTENTIONS OF ASSESSEE AND WHERE RIGHTLY DELETED ADDITION OF R S.1,23,987/- ON ACCOUNT OF PURCHASE OF KAPAS SHANKER. THIS FACTU AL FINDING OF CIT(A) NEEDS NO INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 4.3 NEXT ISSUE AS RAISED IN REVENUES APPEAL IS WIT H REGARDS TO ADDITION OF RS. 71,89,691/- UNDER THE HEAD SHANKER KAPASIYA I.E. COTTON SEEDS. ASSESSING OFFICER HAS MENTIONED THAT AS PER PAGES 1 TO 5 OF X-13, ASSESSEE PURCHASED 518120 KGS OF SHANKER KAPASIYA DURING PERIOD 5.12.2001 TO 28.01.2 001. OUT OF THESE ONLY 142534 KGS WAS ACCOUNTED FOR IN THE B OOKS. ASSESSING OFFICER DID NOT ACCEPT CONTENTION OF ASSE SSEE THAT OTHER CONCERN M/S RAGHUVIR COTTON CO. WAS ALSO OPER ATING FROM THE SAME PREMISES AND PURCHASES OF THAT CONCER N MAY HAVE BEEN INCLUDED. ASSESSING OFFICER HAS FURTHER M ENTIONED I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 11 THAT AS PER PAGES 2 TO 5 OF THE ANNEXURE X-26, ASSE SSEE PURCHASED SHANKER COTTON SEEDS WEIGHING 470260 KGS FROM 5.12.2001 TO 25.01.2001. THESE PURCHASES WERE ALSO UNACCOUNTED. ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION OF ASSESSEE THAT THESE PURCHASES ARE SAME AS RECORD ED IN X-13. STAND OF ASSESSEE HAS BEEN THAT PURCHASES RECORDED IN X-13 BELONG TO TWO FIRMS AND THESE PURCHASES WERE DULY R ECORDED IN THEIR BOOKS OF ACCOUNTS. ASSESSEE FIRM PURCHASED 4 ,30,297 KG. AND M/S RAGHUVIR COTTON CO. HAVE PURCHASED 87,815 K GS OF COTTON SEEDS. IT WAS FURTHER STATED THAT ALL THESE EXPLANATIONS WERE FURNISHED DURING COURSE OF ASSESSMENT PROCEEDI NG. ASSESSING OFFICER HAS NOT ACCEPTED THE PURCHASES MA DE BY M/S. RAGHUVIR COTTON CO. WHEREAS PAYMENTS IN RESPEC T OF PURCHASES MADE BY THAT CONCERN HAVE BEEN MADE BY NO RMAL BANKING CHANNEL AND PAYMENTS HAVE BEEN MADE PRIOR T O THE DATE OF SURVEY. HENCE THESE PURCHASES PERTAINED TO ASSOCIATE CONCERN AND NOT TO THE ASSESSEE. AS REGARDS THE PU RCHASES MENTIONED IN ANNEXURE X-26, STAND OF ASSESSEE HAS BEEN THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS STATEMENT GIVING DETAILS OF PURCHASE MADE DURING THE SAID PER IOD WAS FURNISHED. TRANSACTIONS CONTAINED IN X-26 AND X-13 WERE IDENTICAL. ASSESSING OFFICER HAS CONSIDERED TRANSAC TION RECORDED IN BOTH REGISTERS AS DIFFERENT AND DISTINC T AND MADE SEPARATE ADDITION WHICH IS NOT JUSTIFIED. FURTHER STAND OF ASSESSEE HAS BEEN THAT DATES, VEHICLES NOS. AND QUA NTITY OF GOODS PURCHASED MENTIONED IN BOTH ITEMS WERE IN AGR EEMENT. ALL THESE DOCUMENTS WERE IN CUSTODY OF ASSESSING OF FICER AND I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 12 COULD BE VERIFIED. CONSIDERING THE ARGUMENTS OF AS SESSEE, OBSERVATION OF ASSESSING OFFICER AND REMAND REPORT OF ASSESSING OFFICER, CIT(A) OBSERVED THAT PURCHASES R ECORDED IN X-13 PERTAIN TO ASSESSEE FIRM AND ASSOCIATE CONCERN M/S RAGHUVIR COTTON CO. THE ASSOCIATE CONCERN HAS FILE D RETURN OF INCOME INDEPENDENTLY SHOWING THESE TRANSACTIONS. R ETURN OF SAME HAS BEEN ACCEPTED. ASSESSING OFFICER HAS NOT MENTIONED ANYTHING IN THE REMAND REPORT AGAINST THE PLEA OF A SSESSEE. IN THIS BACKGROUND, CIT(A) RIGHTLY OBSERVED THAT PURCH ASES RECORDED IN X-13 AND X-26 ARE IDENTICAL. ASSESSING OFFICER HAS NOT GIVEN ANY ADVERSE OPINION ON THE POINT IN REMAN D REPORT. MOREOVER ASSESSING OFFICER MADE ADDITION OF THE ENT IRE PURCHASES WHICH WAS NOT CORRECT. AT BEST ADDITION O F THE PEAK AMOUNT CAN BE MADE. IN VIEW OF THIS, CIT(A) DELETE D ADDITION OF RS.71,89,691/-. THIS FACTUAL FINDING OF CIT(A) NEEDS NO INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 4.4 NEXT ISSUE AS RAISED IN REVENUES APPEAL IS WIT H REGARDS TO ADDITION OF RS. 1,65,231/- AS UNACCOUNTED PURCHASE OF KALYAN KAPAS. UNDER THE HEAD KALYAN KAPAS, ASSESSING OFFI CER HAS MADE ADDITION OF RS. 1,65,231/- ON ACCOUNT OF UNACC OUNTED PURCHASE OF 4950 KGS KALYAN KAPAS. ASSESSING OFFIC ER HAS MENTIONED THAT AS PER X-13 PAGE NO. 50 TO 60 PURCHA SE OF KALYAN KAPAS IS 382680 KGS WHEREAS FIGURES SUBMITTE D BY ASSESSEE DURING SURVEY THE PURCHASE WAS OF 377730 K GS. THE DIFFERENCE OF 4950 KGS HAS BEEN TREATED AS UNACCOUN TED I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 13 PURCHASE BY ASSESSING OFFICER AND ADDITION OF RS. 1 ,65,231/- BEING SALE PRICE, HAS BEEN MADE. 4.4.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY, WHEREIN IT WAS SUBMITTED ON BEHALF OF AS SESSEE THAT ASSESSING OFFICER HAS COMPARED THE FIGURES OF PURCH ASE GIVEN AT THE TIME OF SURVEY AND IMPOUNDED BOOKS. WHATEVE R QUANTITY IS MENTIONED IN ANNEXURE X-13 IS DULY RECO RDED IN THE BOOKS OF ACCOUNT. THESE ARE ALSO ENTERED IN IMPOUN DED RECORDS. ASSESSING OFFICER HAS CHOSEN TO IGNORE TH E IMPOUNDED RECORDS. ACCORDINGLY, REQUESTED TO DELETE THE ADDI TION. CIT(A) HAVING CONSIDERED ARGUMENTS OF ASSESSEE AND OBSERVA TIONS OF ASSESSING OFFICER AND REMAND REPORT OF ASSESSING OF FICER OBSERVED THAT ASSESSING OFFICER HAS MADE THIS ADDIT ION ON THE BASIS OF FIGURES GIVEN BY ASSESSEE DURING SURVEY WH ILE HE HAS MADE GROSS PROFIT ADDITION ON THE BASIS OF SALE FIG URES GIVEN BY ASSESSEE AT THE TIME OF ASSESSMENT PROCEEDINGS. IN THIS BACKGROUND, ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING THIS ADDITION AND SAME WAS RIGHTLY DELETED BY CIT(A). T HIS REASONED FACTUAL FINDING OF CIT(A) NEEDS NO INTERFE RENCE FROM OUR SIDE. WE UPHOLD THE SAME. 4.5 NEXT ISSUE AS RAISED IN REVENUES APPEAL IS WIT H REGARDS TO ADDITION OF RS.27,71,015/- AS UNACCOUNTED SALE OF C OTTON. BALES. ASSESSING OFFICER HAS MENTIONED THAT OPENI NG STOCK OF COTTON AND COTTON BALES IS 51460 KGS AND 55300 KGS RESPECTIVELY. TOTAL PRODUCTION WAS 170975 KGS. THE SALE OF COTTON WAS 152825 KGS AND THEREFORE CLOSING STOCK S HOULD BE I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 14 124910 KGS. THE PHYSICAL STOCK AVAILABLE WAS 43000 KGS. ASSESSING OFFICER TREATED THE DIFFERENCE OF 81910 K GS AS UNACCOUNTED SALES AND MADE ADDITION OF R S . 27,71,015/- WHICH WAS TOTAL SALE CONSIDERATION. 4.5.1 IN APPEAL, COUNSEL FOR ASSESSEE SUBMITTED THA T ASSESSING OFFICER HAS MADE ADDITION ON THE GROUND T HAT ASSESSEE FIRM HAS MADE SALES WHICH ARE NOT RECORDED IN THE BOOKS OF ACCOUNT OF 81910 KGS. STAND OF ASSESSEE H AS BEEN THAT ASSESSING OFFICER HAS ACCEPTED THAT SAID SALES HAVE BEEN MADE OUT OF ACCOUNTED STOCK IN BOOKS OF ACCOUNT. I T WAS NOT THE CASE OF REVENUE THAT THERE WAS EXCESS STOCK FOU ND DURING COURSE OF SURVEY WHICH CAN BE TREATED AS UNACCOUNTE D. ACTUALLY THERE WAS A STOCK DEFICIT WHICH HAS BEEN T REATED BY ASSESSING OFFICER AS UNACCOUNTED INCOME. THE STAND OF ASSESSEE HAS BEEN THAT ASSESSING OFFICER CAN ADD THE PROFIT ELEMENT ON SALE OF SUCH GOODS SINCE SALES WERE ACCO UNTED. THE AMOUNT OF SALE DIFFERENCE CANNOT REPRESENT THE INCO ME OF ASSESSEE, WHO HAS DISCLOSED THE SALE. CIT(A) HAVIN G CONSIDERED THE ARGUMENT OF ASSESSEE AND OBSERVATION OF ASSESSI NG OFFICER FOUND THAT SALE OF COTTON BALES IS OUT OF ACCOUNTED STOCK AND AT BEST PROFIT CAN BE ADDED AND NOT ENTIRE SALE. ACCO RDINGLY, ASSESSING OFFICER IS DIRECTED TO COMPUTE PROFIT ON SALE OF COTTON BALES AND MAKE ADDITION OF PROFIT ON SALE OF COTTON BALES AND NOT ENTIRE SALE. THIS REASONED FACTUAL FINDING OF C IT(A) NEEDS NO INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 15 4.6 NEXT ISSUE AS RAISED IN REVENUES APPEAL IS WIT H REGARDS TO ADDITION OF RS.8,10,665/- FOR UNACCOUNTED SALE OF K ALA. ASSESSING OFFICER HAS MENTIONED IN ANNEXURE X-13 WH ICH BELONGS TO ASSESSEE FIRM IT HAS PURCHASED 3,13,315 KGS OF KALA AS PER PAGE NOS. 10-18. SINCE X-13 BELONGS TO ASS ESSEE AND NOT TO RAGHUVIR COTTON, THE PURCHASE OF KALA HAS BE EN MADE BY ASSESSEE FIRM AND NOT BY RAGHUVIR COTTON AS STATED BY ASSESSEE. ASSESSING OFFICER THEREFORE HELD THAT IN COME OF RAGHUVIR COTTON IS TO BE CONSIDERED FOR CLUBBING WI TH INCOME OF ASSESSEE. AS AGAINST PURCHASE OF 3,13,315 KGS O F KALA PURCHASE OF 75,520 KGS WAS ENTERED IN LEDGER. ASSE SSING OFFICER HAS FURTHER MENTIONED THAT OPENING STOCK OF KALA WAS 2,59,400 KGS AND HENCE 5,72,715 KGS OF KALA WAS AVA ILABLE FOR PRODUCTION OF KAPAS. AS PER NORMS GIVEN BY ASSESSE E ASSESSING OFFICER HAS MENTIONED THAT ASSESSEE HAS PRODUCED 1,60,360 KGS OF COTTON AND 2,40,540 KGS OF COTTON S EED. THERE WAS NO CLOSING STOCK AVAILABLE AT THE BUSINESS PREM ISES AT THE TIME OF SURVEY. AS PER BOOKS OF ACCOUNTS OF SH. RA GHUBIR COTTON SALE OF 76,677 KGS OF COTTON AND 96,943 KGS OF COTTON SEEDS HAS BEEN MADE. ASSESSING OFFICER COMPUTED TH E VALUE OF BALANCE AT RS 28,30,996/- OF COTTON SEEDS AND RS. 1 5,47,976 OF COTTON. ASSESSING OFFICER DID NOT ACCEPT THE STAND OF ASSESSEE THAT PURCHASES PERTAINED TO M/S RAGHUBIR COTTON COM PANY. ASSESSING OFFICER WORKED OUT THE PROFIT ON SALE OF COTTON AND COTTON SEED AT RS. 8,10,665 AND MADE ADDITION OF TH E SAME. I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 16 4.6.1 MATTER WAS CARRIED BEFORE FIRST APPELLATE AUT HORITY, WHEREIN STAND OF ASSESSEE HAS BEEN THAT ASSESSING O FFICER HAS RELIED ON X-13 WHICH HAS BEEN IMPOUNDED FROM PREMIS ES OF ASSESSEE AND CONTAINS TRANSACTIONS CARRIED OUT BY A SSESSEE FIRM. IT WAS STATED ON BEHALF OF ASSESSEE THAT IT WAS EXPLAINED TO ASSESSING OFFICER THAT APPLICANT FIRM IS NOT DEA LING IN KALA. THIS WAS CLEARLY AND CATEGORICALLY STATED IN THE ST ATEMENT RECORDED DURING SURVEY PROCEEDINGS. DURING COURSE OF ASSESSMENT PROCEEDINGS, IT WAS POINTED OUT THAT PUR CHASE OF KALA WAS MADE BY M/S. RAGHUVIR COTTON CO. AND EVIDE NCE IN SUPPORT OF SAME WAS FURNISHED. HOWEVER, ASSESSING OFFICER IGNORED THE VARIOUS ARGUMENTS GIVEN AT THE TIME OF SURVEY AS WELL AS ASSESSMENT PROCEEDINGS. THE STAND OF ASSES SEE HAS BEEN THAT SINCE SAID PURCHASES WERE DULY ACCOUNTED FOR IN THE BOOKS OF ACCOUNT OF M/S. RAGHUVIR COTTON CO. THEY D ID NOT PERTAIN TO ASSESSEE FIRM AND QUESTION OF MAKING ADD ITION COULD NOT ARISE. CIT(A) HAVING CONSIDERED ARGUMENTS OBSE RVED THAT ASSESSING OFFICER HAS NOT ACCEPTED THE CONTENTION O F ASSESSEE ON THE GROUND THAT IMPOUNDED BOOK X-13 BELONGS TO A SSESSEE AND TRANSACTIONS RECORDED PERTAINED TO ASSESSEE ALO NE. ASSESSEE ON OTHER HAND HAS MENTIONED DURING SURVEY ITSELF THAT IT IS NOT DEALING IN KALA AND THE ASSOCIATE CO NCERN M/S. RAGHUVIR COTTON WAS DEALING WITH THE SAME. MOREOVER , THE SALE OF KALA HAS BEEN REFLECTED IN THE TRANSACTIONS OF A SSOCIATE CONCERN FOR WHICH RETURN HAS BEEN FILED. ASSESSING OFFICER HAS NOT POINTED OUT ANYTHING ADVERSE IN THE REMAND REPO RT FILED BY ASSESSING OFFICER. IN THIS BACKGROUND, CIT(A) RIGH TLY OBSERVED I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 17 THAT ADDITION MADE BY ASSESSING OFFICER BY CLUBBIN G THE INCOME OF M/S. RAGHUVIR COTTON CO. WAS NOT JUSTIFIE D AND SAME WAS RIGHTLY DIRECTED TO BE DELETED. WE UPHOLD THE SAME. 4.7 NEXT ISSUE AS RAISED IN REVENUES APPEAL IS WIT H REGARDS TO ADDITION OF RS.11,16,568/- ON ACCOUNT OF UNEXPLAINE D STOCK DIFFERENCE. ASSESSING OFFICER HAS MENTIONED THAT T HERE WAS DIFFERENCE IN STOCK OF COTTON OF 1,27,971 KGS AND O F COTTON SEEDS OF 79,703 KGS. ASSESSING OFFICER TREATED THE DIFFERENCE OF STOCK AS UNEXPLAINED INVESTMENT OF THE ASSESSES AND MADE ADDITION OF RS. 11,16,568/- BY WORKING OF THE PROFI T ON SALES OF THESE ITEMS. IN APPEAL, STAND OF ASSESSEE HAS BEEN THAT ADDITION HAS BEEN MADE BY RELYING ON QUESTION NO.2 &3 OF STATEMENT RECORDED ON 12.2.2002. IT WAS FURTHER AR GUED THAT ASSESSING OFFICER HAS SEPARATELY ADDED GROSS PROFIT OF VARIOUS ITEMS DEALT IN BY ASSESSEE AND DETERMINED UNACCOUNT ED SALES OF COTTON SEEDS. 4.7.1 IN APPEAL, CIT(A) HAVING CONSIDERED THE OBSER VATIONS OF ASSESSING OFFICER AND ARGUMENTS OF ASSESSEE FOUN D THAT ASSESSEE WAS RIGHT IN ARGUING THAT ASSESSING OFFICE R HAS ALREADY MADE ADDITION OF GROSS PROFIT OF VARIOUS IT EMS. SAME ADDITION CAN NOT BE MADE AGAIN. ACCORDINGLY, SAME WAS DELETED BY CIT(A). THIS REASONED FACTUAL FINDING OF CIT(A) NEEDS NO INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 4.8 NEXT ISSUE AS RAISED IN REVENUES APPEAL IS WIT H REGARDS TO ADDITION OF RS. 3,47,181 /- ON ACCOUNT OF DISALLOWA NCE OF I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 18 UNPAID SALES TAX U/S. 43B OF THE INCOME TAX ACT. A SSESSING OFFICER HAS MENTIONED THAT SALES TAX AMOUNTING TO R S. 3, 47,181/- HAS REMAINED UNPAID. BEFORE ASSESSING OFFI CER, ASSESSEE STATED THAT IT WAS EXEMPT FROM SALES TAX A ND FILED A COPY OF SALE TAX EXEMPTION CERTIFICATE AND HENCE AS SESSEE CLAIMED THAT UNPAID AMOUNT SHOULD NOT BE ADDED U/S 43B OF THE ACT. ASSESSING OFFICER DID NOT ACCEPT THE CONT ENTION OF ASSESSEE ON THE GROUND THAT ASSCSSEE HAD NOT FOLLOW ED PROCEDURE PRESCRIBED IN GUJARAT SALES TAX ACT. ASS ESSING OFFICER FURTHER MENTIONED THAT SALES TAX RECOVERED BY ASSESSEE FROM CUSTOMERS CONSTITUTES TRADING RECEIPT OF ASSES SEE. ASSESSING OFFICER HELD THAT SALES TAX COLLECTED BY THE ASSESSEE IS BUSINESS RECEIPT AND ASSESSING OFFICER HAS ALSO QUOTED CBDT CIRCULAR NO.674 DATED 29.12.1993 AS PER WHICH THE AMOUNT OF SALES TAX LIABILITY CONVERTED INTO LOAN I S TO BE ALLOWED AS A DEDUCTION IN WHICH CONVERSION HAS BEEN PERMITT ED BY SAID GOVERNEMNT. SINCE ASSESSEE FAILED TO FURNISH ANY EV IDENCE IN THIS REGARD ASSESSING OFFICER TREATED THE UNPAID SA LES LAX AS INCOME OF ASSESSEE. 4.8.1 IN APPEAL, CIT(A) GRANTED RELIEF TO ASSESSEE. SAME HAS BEEN OPPOSED ON BEHALF OF REVENUE. BEFORE US, LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF ASSESSING OFFICER AND REQUESTED TO SET ASIDE THE ORDER OF CIT (A). ON OTHER HAND, LEARNED AUTHORIZED REPRESENTATIVE SUPPORTED T HE ORDER OF CIT(A). I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 19 4.8.2 AFTER GOING THROUGH RIVAL SUBMISSIONS AND MAT ERIAL ON RECORD, WE FIND THAT STAND OF ASSESSEE IN THIS R EGARD HAS BEEN THAT ASSESSING OFFICER HAS MADE ADDITION ON T HE GROUND THAT ENTIRE PROCEDURE HAS NOT BEEN FOLLOWED AND ONL Y CERTIFICATE ISSUED BY THE DISTRICT INDUSTRY CENTRE WAS FILED AN D CERTIFICATE ISSUED BY SALES TAX AUTHORITY WAS NOT FURNISHED. S TAND OF ASSESSEE HAS BEEN THAT THIS CERTIFICATE WAS NEVER C ALLED FOR BY ASSESSING OFFICER AND HAS ENCLOSED THE CERTIFICATE ISSUED BY SALES TAX AUTHORITY DURING APPELLATE PROCEEDINGS. C IT(A) HAVING CONSIDERED THE SAME OBSERVED THAT ASSESSING OFFICER HAS MADE ADDITION OF THIS AMOUNT ON THE GROUND THAT ASSESSEE DID NOT PRODUCE REQUIRED CERTIFICATE IN FORM D ISSUED BY SA LES TAX AUTHORITY. THE CERTIFICATE HAS BEEN PRODUCED BY ASS ESSEE DURING APPELLATE PROCEEDINGS SINCE IT WAS NOT CALLE D FOR DURING ASSESSMENT PROCEEDINGS. IN REMAND REPORT, ASSESSIN G OFFICER HAS NOT COMMENTED ON CERTIFICATE WHICH SHOWS THAT H E AS NOTHING TO SAY ON THE POINT. SINCE ASSESSEE FULFI LLED THE CONDITIONS AS PRESCRIBED IN THIS REGARD. ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING ADDITION OF UNPAID SALES TA X LIABILITY. SAME WAS RIGHTLY DELETED BY CIT(A). WE UPHOLD THE SAME. 4.9 NEXT ISSUE AS RAISED IN ASSESSEES APPEAL IS WI TH REGARDS TO DIRECTION TO COMPUTE PROFIT OF SALE OF COTTON BA LES AND MAKING ADDITION ON PROFIT OF SALE OF COTTON BALES A ND NOT ENTIRE SALE ITSELF. WE HAVE DEALT THIS ISSUE IN PARA 4.5 WHICH TAKE CARE OF THIS ISSUE. I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 20 4.10. NEXT ISSUE AS RAISED IN ASSESSEES APPEAL IS WITH REGARDS TO ADDITION OF RS. 4,61,445/- MADE ON ACCOU NT OF UNEXPLAINED CASH CREDITS AS UNDER: 1. JAYANTIBHAI DALSUKH RS.1,11,587/- 2. GAJIBHAI BHAGWANBHAI RS. 99,858/- 3. DHIRUBHAI AMBARAM RS.1,00,000/- 4. LAGHRABHAI RATUBHAI RS.1,00,000/- 5. LALUBHAI GAJUBHAI RS. 50,000/- ----------------- RS.4,61,445/- ---------------- ASSESSING OFFICER MADE ADDITION OF RS.4,61,445/- ON ACCOUNT OF UNEXPLAINED CASH CREDIT. ASSESSING OFFICER HAS MENT IONED THAT ASSESSEE HAS RAISED CASH CREDIT AMOUNTING TO RS. 4, 61,445/- FROM 5 PERSONS. ASSESSEE SUBMITTED ONLY COPIES OF ACCOUNTS OF THESE FIVE PERSONS AS APPEALING IN ITS BOOKS OF ACC OUNTS. HOWEVER, ASSESSEE FAILED LO FILE ANY CONFIRMATION F ROM THESE 5 POISONS AND ALSO FAILED TO PRODUCE THESE PERSONS FO R VERIFICATION AND THUS FAILED TO PROVE THE GENUINENE SS OF CREDITS APPEARING IN THE BOOKS. ASSESSING OFFICER THEREFORE HELD THAT ASSESSEE HAS FAILED TO PROVE THE IDENTITY AND CREDI T WORTHINESS OF THESE 5 PERSONS AND MADE ADDITION OF RS. 4,61,44 5/- AS UNEXPLAINED CASH CREDITS U/S 68 OF THE INCOME TAX A CT. 4.10.1 IN APPEAL, VARIOUS CONTENTIONS WERE RAISED O N BEHALF OF ASSESSEE, HAVING CONSIDERED THE SAME CIT(A) OBSE RVED THAT ASSESSEE HAS FAILED TO FILE CONFIRMATIONS AND ALSO FAILED TO PRODUCE THE CREDITORS TO ESTABLISH THE GENUINENESS OF CASH CREDITS. ACCORDINGLY, ADDITION MADE BY ASSESSING O FFICER OF RS. I.T.A. NOS. 2144 & 2172/AHD/07 FOR A.Y. 02-03 (ITO VS. M/S. M/S. SHREE JALARAM INDUSTRIES) PAGE 21 4, 61,445/- AS UNEXPLAINED CASH CREDIT WAS RIGHTLY CONFIRMED BY CIT(A), WHICH NEEDS NO INTERFERENCE FROM OUR SID E. WE UPHOLD THE SAME. 5. AS A RESULT, REVENUES APPEAL AS WELL AS ASSESSE ES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS THE 27 TH DAY OF MARCH, 2015. SD/- SD/- (N. S. SAINI) (SHAILEND RA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMB ER AHMEDABAD: DATED 27/03/2015 TRUE COPY S.K.SINHA # # # # %& %& %& %& '&' '&' '&' '&' / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. / ASSESSEE 3. ,, - / CONCERNED CIT 4. -- / CIT (A) 5. &12 %, , / DR, ITAT, AHMEDABAD 6. 256 78 / GUARD FILE. BY ORDER / # , 9/ , , ;