DCIT, Jamshepur V. M/s Hard Rock Fabrication (P) Ltd, Jamshedpur

ITA 26/RAN/2016

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 9575 (ITAT-RANCHI)
• Duration Of Justice: 3 year(s) 2 month(s) 30 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 05-04-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 06-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: INDERJIT SINGH CIT LD
• Keywords: Additional evidence; Tangible material; Corroborative evidences; TDS
• Section: 143(3); 234B

Judgement Text

1 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 1 IN THE INCOME TAX APPELLATE TRIBUNAL RANCHI BENCH, RANCHI (BEFORE SHRI S. S. GODARA , J.M. & DR.A.L.SAINI, A.M.) IT A NO. 2 6 /RAN/1 6 : ASSTT. YEAR : 20 1 0 - 11 D.C.I.T, CIR - 1, JSR VS M/S. HARD ROCK FABRICATION P.LTD. PAN: AABCM4537C (APPELLANT) ( RESPONDENT) APPELLANT/ D EPARTMENT BY : SHRI INDERJIT SINGH, CIT, LD. DR RESPONDENT/ ASSESSEE BY : NONE APPEARED DATE OF HEARING : 10 - 01 - 2019 DATE OF PRONOUNCEMENT: 22 - 0 2 - 2019 ORDER PER BENCH : THE CA PTIONED APPEAL FILED BY THE REVENUE , PERTAINING TO ASSESSMENT YEAR 20 1 0 - 11 , IS DIRECTED AGAINST THE ORDER PASSED BY THE COMMISSIONER OF INCOME - TAX (APPEALS), JAMSHEDPUR IN APPEAL NO. 59/JSR/2013 - 14 , DATED 2 8 - 10 - 2015, WHICH IN TURN ARISE S OUT OF AN ASSESSME NT ORDER DATED 22 - 03 - 2013 PASSED BY THE ASSESSING OFFICER U/S. 143(3) OF THE INCOME - TAX ACT, 1961 (IN SHORT, THE ACT). 2. THE GRIEVANCES RAISED BY THE REVENUE ARE AS FOLLOWS: - I) FIRST GROUND OF APPEAL IS THAT THE LD.CIT(APPEALS), JAMSHEDPUR HAS ERRED I N DELETING THE ADDITION OF RS.5,556/ - MADE ON ACCOUNT INTEREST ON CURRENT ACCOUNT DEPOSITS. II) SECOND GROUNDS OF APPEAL IS THAT THE LD. CIT(APPEALS), JAMSHEDPUR HAS ERRED IN DELETING THE ADDITION OF RS.4,67,98,561/ - MADE BY THE AO ON ACCOUNT OF DIF FERENCE IGNORING THE DETAILED ANALYTICAL 2 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 2 JUSTIFICATION GIVEN IN THE ASSESSMENT ORDER AS WELL AS IN THE REMAND REPORT. III) THIRD GROUNDS OF APPEAL IS THAT THE LD. CIT(APPEALS), JAMSHEDPUR HAS ERRED IN LAW AND UPON FACTS OF THE CASE IN DIRECTING THE AO T O MODIFY INTEREST U/S. 234B OF THE INCOME TAX ACT, 1961 FOLLOWING THE DECISION OF SHRI AJAY PRAKASH VERMA IN T.A NO. 38 OF 2010 REPORTED IN 2013(1) TMI 140 WHICH DIRECT TO CHARGE INTEREST U/S. 234B OF THE INCOME TAX ACT, 1961 ON RETURNED INCOME. IN FACT, T HE DEPARTMENT HAS ALREADY FILED A REVIEW PETITION AGAINST THE ORDER PASSED REFERRED AS ABOVE BEFORE THE HONBLE HIGH COURT OF JHARKHAND. 3 . AT THE TIME OF HEARING NONE APPEARED ON BEHALF OF ASSESSEE IN SPITE OF ISSUANCE OF NOTICE FOR HEARING MORE THAN ONE OCCASIONS. THE LEARNED DEPARTMENTAL REPRESENTATIVE ( LD.DR) WAS PRESENT FOR THE APPELLANT REVENUE. IN THE ABSENCE OF ANY APPEARANCE OF THE ASSESSE, THE APPEAL IS BEING DISPOSE OF EX PARTE QUA THE ASSESSE AFTER HEARING THE LD. DR FOR THE REVENUE ON MER ITS IN TERMS OF RULE 24 OF ITAT RULES, 1963. 4. GROUND NO. 1 RELATES TO DELETION OF ADDITION OF RS.5,556/ - BY THE LD. CIT(A). 5 . THE BRIEF FACTS QUA THE ASSESSE ARE THAT DURING THE ASSESSMENT PROCEEDINGS THE AO ON PERUSAL OF ANNEXURE D OF FORM NUMB ER 3CD NOTED THAT AN AMOUNT OF RS. 1961/ - WAS PAID AS INTEREST ON TDS , WHICH IS TO BE DISALLOWED . THE ASSESSE HAS NOT ADDED THIS AMOUNT IN THE COMPUTATION OF INCOME. THE ASSESSE HAS ACCEPTED ITS MISTAKE IN HIS LETTER D A T ED 22 - 02 - 2013 , HENCE, AN AMOUNT OF RS.1,961 WAS DISALLOWED AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSE E . 6 . AGGRIEVED BY THE ORDER OF THE LD.AO, THE ASSESSE E CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). , WHO DELETED THE SAID ADDITION BY OBSERVING AS FOLLOW: - 3 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 3 4.2 I HA VE GONE THROUGH THE ORDER OF THE LD. AO AS WELL AS THE SUBMISSION OF THE APPELLANT. THE AO IN HIS ORDER HAVE STATED THAT THE ASSESSE HAS ACCEPTED ITS MISTAKE IN HIS LETTER DATED 22.02.2013. THE APPELLANT STATED THAT THE AO IS NOT JUSTIFIED IN MAKING DISALL OWANCE OF RS. 1961/ - AS HE DID NOT BRING ANY MATERIAL FACTS AS TO HOW IT IS AN ALLOWABLE DEDUCTION. THERE ARE SEVERAL DECISION IN FAVOUR OF REVENUE WHICH ARE AS UNDER: - A. CIT VS. ASHOKA MILLS LTD ( 1996 ) 218 ITR 526 GUJRAT B. CIT VS. RAIPUR MANUFACTURING COMP ANY LTD 135 CTR 248 GUJRAT C. CIT VS. SARASPUR MILS ( 1997 ) 226 ITR 533 GUJRAT D. BHARAT COMMERCE INDUSTRIES VS. CIT ( 1998 ) 230 ITR 733 (SC) WHERE IT HAS BEEN HELD THAT INTEREST PAID UNDER ANY PROVISION OF THE IT ACT , W.T ACT ETC FOR LATE PAYMENT OR SHORT PAYMEN T OF ADVANCE TAX, SELF ASSESSMENT TAX, TDS ARE NOT DEDUCTIBLE EXPENSES. HENCE, DEDUCTION CLAIMED OF RS. 1961/ - MADE BY THE AO IS HEREBY CONFIRMED. DURING THE COURSE OF APPELLATE PROCEEDING IT IS STATED THAT CREDIT BALANCE APPEARING IN BALANCE SHEET REPRESE NTS BALANCE IN CURRENT ACCOUNT. THE BANK DOES NOT PROVIDE ANY INTEREST ON CURRENT ACCOUNT DEPOSITS, THEREFORE THE AO IS NOT JUSTIFIED IN MAKING ADDITION OF RS.5556/ - . 7 . AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 8 . THE LD. DR HAS PRIMARILY REITERATED HIS STAND AS TAKEN BY THE AO. HE RELIED ON THE ORDER OF THE AO. HE ALSO SUBMITTED BEFORE US THAT THE LD. CIT(A) HAS ERRED IN DELETING THE IMPUGNED ADDITION. 9. WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIAL AVAI LABLE ON RECORD. W E NOTE THAT DU RING THE COURSE OF APPELLATE PROCEEDING IT IS STATED THAT CREDIT BALANCE APPEARING IN BALANCE SHEET REPRESENTS BALANCE IN CURRENT ACCOUNT. THE BANK DOES NOT PROVIDE ANY INTEREST ON CURRENT ACCOUNT DEPOSITS, THEREFORE THE AO IS NOT JUSTIFIED IN MAKING ADDITION OF RS.5556/ - . THE CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION. HENCE, WE DECLINED TO INTERFERE IN THE IMPUGNED ORDER OF THE LD. CIT(A). HIS ORDER ON THIS ISSUE IS HEREBY UPHELD. GROUND RAISED BY THE REVENUE IS DISMISS ED. 4 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 4 1 0 . GROUND NO. 2 RELATES TO DELETION RELATING TO DIFFERENCE IN STOCK OF RS.4,67,98,561/ - BY THE LD. CIT(A). 11 . THE B RIEF FACTS QUA THE ISSUE ARE THAT DURING THE COURSE OF SURVEY OPERATION THE SURVEY TEAM FOUND PHYSICALLY STOCK OF RS. 2,31,92,749/ - . THE STOCK REGISTER WAS NOT MAINTAINED BY THE ASSESSE. AS PER BOOKS OF ACCOUNTS MAINTAINED ON COMPUTER A TRADING ACCOUNT WAS RECASTED DURING THE COURSE OF SURVEY PROCEEDINGS, WHICH IS REPRODUCED HEREUNDER: - OPENING STOCK 7,26,62,748 / - SALES 59,55,08,721 / - PURCHASE 42,81,14,722 / - CLOSING STOCK ( - )4,07,18,611 / - G.P @ 9.07% TAKEN AS PER A.YR 2009 - 10 5,40,12,640 / - TOTAL 55,47,90,110 / - 5 5,47,90,110 / - 1 2 . THE AO ASKED THE ASSESSE E TO EXPLAIN THE STOCK DIFFERENCE. IN RESPONSE THE ASSESSE SUBMITTED THE FO LLOWINGS: - THAT ON THE DATE OF SURVEY I.E. 18.03.2010 THE BOOKS OF ACCOUNT WERE NOT UP - TO DATE AND FEW PURCHASE AND SALE ENTRIES FOR THE MARCH MONTH WERE PASSED SUBSEQUENTLY. THAT IN THE TRADING ACCOUNT RE - CASTED AND RE - PRODUCE BY YOUR GOOD OFFICE. IT I S OBSERVED THAT YOUR HONOUR HAS OMITTED TO TAKE INTO ACCOUNT THE DIRECT EXPENSES OF RS. 1.90 CRORES AND THE DUTIES & TAXES OF RS.6.05 CRORES. THAT A FRESH TRADING ACCOUNT FOR THE PERIOD STARTING FROM THE BEGINNING OF THE RELEVANT FINANCIAL YEAR TILL TH E DATE OF SURVEY IS RE - CASTED AND RE - PRODUCED BELOW CONSIDERING THE UP - TO - DATE SALE AND PURCHASE FIGURE, TAKING INTO ACCOUNT THE DIRECT EXPENSES AND DUTIES AND TAXES AS PER THE AUDITED FINANCIAL STATEMENT OF FINANCIAL YEAR 2009 - 10. THAT THE TRADING ACCOUNT OF RESIDUARY PERIOD ( I.E. 18/03/2010 TO 31/03/2010) IS ALSO PRODUCED HEREIN BELOW FOR YOUR KIND REFERENCE. PARTICULARS 01/04/09 TO 17/03/10 18/03/10 TO 31/03/10 01/04/09 TO 31/03/10 PARTICULARS 01/04/09 TO 17/03/10 18/03/10 TO 31/03/10 01/04/09 TO 31/ 03/10 OPENING STOCK 7.27 7.85 7.27 GROSS SALES 59.66 7.30 66.96 PURCHASES 45.07 5.73 51.00 CLOSING STOCK 7.85 (BALANCE) 9.39 9.39 DIRECT 1.90 0.16 2.06 5 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 5 EXPENSES DUTIES & TAXES 1.86 7.91 GROSS PROFIT (12.11%) 7.22 0.89 (BALANCE FIGURE) 8.11 TOTAL 67.51 16.69 76.35 TOTAL 67.51 16.69 76.35 THAT UPON PERUSAL OF ABOVE YOUR HONOUR SHALL FIND THAT THERE WAS A CLOSING SOTKC OF RS. 7.85 CRORES AS AT THE END OF THE 17 TH MARCH, 2010. DURING THE SSURVEY OPERATION THE PHYSICAL STOCK AS ON T HAT DATE WAS RECORDED AT 2.32 CRORES WHICH IS LESS THAN THE STOCK AS PER BOOKS OF ACCOUNTS. THUS THERE IS NO NON - DISCLOSURE OR UNDERVALUATION OF STOCK IN THE BOOKS OF ACCOUNT. IT MAY ALSO BE NOTED THAT THE ASSESSE E COMPANY PRODUCES BUCKETS FRAMES, ARMS, BOOKS LINK S ETC, USED IN CONSTRUCTION AND MINING HEAVY EQUIPMENTS , WHICH DO NOT HAVE GENERAL MARKET. THESE ARE MANUFACTURED AND SOLD TO SPECIFIC CUSTOMERS TO NAME TELECOM, BEML AND ITS ASSOCIATED CONCERNS WHICH HAVE SPECIFIC DEMAND FOR ITS PRODUCT. THUS THE VALUE O F THE PRODUCTS MANUFACTURED BY THE ASSESSE COMPANY IS NOT EXPOSED TO OPEN MARKET. 1 3 . HOWEVER, THE AO REJECT ED THE CONTENTION & WRITTEN SUBMISSIONS OF THE ASSESSE AND MADE THE IMPUGNED ADDITION. 1 4 . AGGRIEVED BY THE STAND SO TAKEN BY THE AO, THE ASSESSE E PREFERRED AN APPEAL BEFORE THE LD. CI T (A), WHO AFTER TAKING INTO ACCOUNT THE REMAND REPORT OF THE AO , REBUTTAL TO THE REMAND REPORT BY THE ASSESSE E AND DETAILED CALCULATION AND COMPUTATION OF STOCK SUBMITTED BY THE ASSESSE E BEFORE HIM DELETED THE IMPUGN ED ADDITION BY OBSERVING AS UNDER: - BASED ON ABOVE I FOUND THAT THE FACT IS CORRECT AND EVEN THE AO DID NOT TAKEN THE FACTS STATED BY THE ASSESSE IN CONSIDERATION. I ALSO FOUND THAT THE AOS INSISTING ON PROFIT @9.07 ONLY AND NO OTHER CONSIDERATION IS THE RE. HAD IT BEEN CONSIDERED AND PROFIT IS TAKEN @ 9.07 BY THE AO, SCENARIO WOULD BE AS UNDER AS ON THE DATE OF SURVEY. OPENING STOCK RS. 7,26,62, 748/ - SALES RS.59,55,08,721/ - PURCHASE RS.42,81,14,722 / - CLOSING STOCK RS. 3,90,81,389/ - DIRECT EXPENS ES RS.17,000, 000/ - DUTIES AND TAXES RS. 6,28,00,000/ - 6 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 6 G.P 9.07% RS. 5,40,12,640 / - .. TOTAL RS. 63,45,90,11 0 / - RS.63,45,90,110 / - THIS AGAINST THE STOCK FOUND AT RS. 2,31,92,749/ - IS NEARER TO THE STOCK FOUND DURING THE COURSE OF SURV EY. BUT NEITHER THE METHOD ADOPTED BY THE AO AT THE TIME OF SURVEY NOR MATHEMATICAL CALCULATION GIVEN ABOVE IS FULL PROOF. THE AO IN HIS ORDER IS NOT ACCEPTING THE GP RATE DECLARE @12.11% DESPITE THE FACT THAT GP OF ASSESSE IN PREVIOUS YEARS WERE AS UNDER: 2007 - 08 - 12.23 2008 - 09 - 6.79 2009 - 10 - 9.07 2010 - 11 - 12.11 FROM ABOVE IT CAN BE SEEN THAT GP VARIES FROM 6.79% TO 12.23%. THEREFORE THE GP DECLARED BY THE ASSESSE SHOULD HAVE BEEN ACCEPTED. ASSESSEE CONTENTION GET SUPPORT FROM THE ADDITIONAL SUBMI SSION MADE BEFORE THE UNDERSIGNED ON WHICH THE AO HAS NO OBJECTION, IF CONSIDERED AS PER HIS LETTER DATED 31.07.2015 WHIH IS REPRODUCED BELOW: - REMAND REPLY : 2.1 THAT THE NEW EVIDENCES (PAGE NOS. 4 TO 302) WHICH WERE PRESENTED BY THE ASSESSE DURING THE ASSESSMENT PROCEEDING, IF SUBSTANTIATE THE EARLIER EXPLANATIONS GIVEN BY THE ASSESSE AND CONSTITUTES DOCUMENTARY EVIDENCE COULD BE ADMITTED UNDER RULE - 46A OF THE IT RULES, 1962, CONSIDERING THE TIME CONSTRAINTS IN PREPARING AND ARRANGING THE EVIDENCES BY THE ASSESSE DURING ASSESSMENT. 2.2 THAT THE ADDITION ON ACCOUNT OF STOCK AMOUNTING TO RS. 4.67 CRORES WAS BASED ON THE BASIS OF NEGATIVE STOCK COMPUTED IN TRADING ACCOUNT RE - CASTED WITH FACTS AND SUPPORTING EVIDENCES AVAILABLE DURING ASSESSMENT AND STOCK F OUND DURING THE COURSE OF SURVEY. 2.3 THAT THE DUTIES AND TAXES OF RS.6.05 CRORES WERE NOT CONSIDERED IN COMPUTING THE CLOSING STOCK BECAUSE THE ASSESSE FAILED TO BRING ANY CREDIBLE EVIDENCE TO SUBSTANTIATE THAT THE SALES FIGURE TAKEN AT THE TIME OF SURVEY WAS INCLUSIVE OF DUTIES. 2.4 THAT THE PURCHASES MADE ON OR BEFORE THE DATE OF SURVEY AMOUNTING TO RS. 2.26 CRORES AND DIRECT EXPENS E S FOR THE SAME PERIOD AMOUNTING TO RS. 0.19 CRORES AND SALES FOR THE SAME PERIOD AMOUNTING TO RS. 0.11 CRORES WERE NOT CONS IDERED BECAUSE THE ASSESSE DID NOT SUBMIT ANY DOCUMENTARY EVIDENCE IN SUPPORT OF ITS CLAIM OF DIFERENCE OF AMOUNT FROM THE PRINT OUT TAKEN DURING THE COURSE OF SURVEY. 7 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 7 2.5 THAT THE ASESSEES CALCULATION OF STOCK OF RS. 7.85 CRORES IN CONTRAVENTION TO STOCK OF RS. 2.31 CRORES RECORDED AT THE TIME OF SURVEY WAS ACCEPTED IN THE ASSESSMENT AS THE ASSESSE FAILED TO SUBMIT ANY SPECIFIC SUPPORTING EVIDENCE FOR THE DIFFERENCE IN THE STOCK. 2.6 THAT THE OTHER ADDITIONS HAVE BEEN BASED ON THE FACTS AND SUPPORTING EVI DENCES AVAILABLE DURING ASSESSMENT. FURTHER, THE APPELLANT WHICH HAS PRODUCED ADDITIONAL SUBMISSION IN THE PAPER BOOK - I ALSO SHOWS THAT THE ASSESSE USED TO TAKE DUTIES AND TAXES IN HIS TRADING ACCOUNT. THUS THE ASSESSE IS CORRECT TO STATE THAT THE EXCI SE DUTY AND TAXES SHOULD BE INCLUDED IN PURCHASES AS IN THE CASE OF DEDUCE CORRECT STOCK. NEITHER THE REVENUE CONSIDERED THE DUTIES AND TAXES AT THE TIME OF SURVEY OPERATION NOR AT THE TIME OF ASSESSMENT PROCEEDING, I AM O THE VIEW THAT INADVERTENTLY GROS S MISTAKES HAS BEEN MADE BY THE AO WHILE PASSING THE ORDER. THE ASSESSE TOO HAS COMMITTED MISTAKE THAT HE USED TO CLAIM DUTIES AND TAXES NOT UNDER PURCHASES BUT SEPARATELY UNDER THE HEAD MANUFACTURING AND OTHER EXPENSES. BUT THEN THIS MAKES NO DIFFERENCE AS ACCOUNTING STANDARD HAS BEEN FOLLOWED AND EXPENSES HAS BEEN CLAIMED. CONSIDERING THE FACTS MENTION ABO V E AND ADDITIONAL EVIDENCE I.E STOCK REGISTER, PAPER BOOK - 2 PAGE 173 TO 302 PRODUCED BEFORE THE UNDERSIGNED, I DID NOT FIND THAT THE AO IS CORRECT TO STATE THAT NO STOCK REGISTER IS MAINTAINED. THE PAGE NO. 173 TO 302 OF THE ADDITIONAL EVIDENCE IS THE STOCK REGISTER OF THE ASSESSE FOR THE PERIOD ENDING 31.03.2010. THEREFORE, THE ADDITION MADE BY THE AO COULD NOT BE SUBSTANTIATED BY THE AO AS FACTUAL A ND CORRECT. HENCE ADDITION OF RS. 4,67,98,561/ - UNDER THE HEAD DIFFERENCE IN STOCK IS HEREBY DELETED. 15. THE LD. DR HAS PRIMARILY REITERATED HIS STAND AS TAKEN BY THE AO. HE RELIED ON THE ORDER OF THE AO. HE ALSO SUBMITTED BEFORE US THAT THE LD. CIT(A ) HAS ERRED IN DELETING THE IMPUGNED ADDITION. 1 6 . WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE NOTE THAT THE ASSESSE E BEFORE THE AO/CIT - A SUBMITTED DETAILED WRITTEN SUBMISSION, 8 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 8 REPLIES OF REMAND REPORT AND DETAILED CALCULAT ION OF STOCK & G ROSS PROFIT RATE . THE LD. CIT(A ) DELETED THE IMPUGNED ADDITION AFTER ANALYZING ALL THE MATERIAL AS AVAILABLE BEFORE HIM. WE FURTHER NOTE THAT THE STOCK AS COMPUTED BY THE AO IS NOT SUPPORTED BY ANY MATERIAL. IN FACT, THE STOCK COMPUTED BY THE AO BY TAKING INTO ACCOUNT THE PROFIT RATE @9.07% CLOSING STOCK OF RS. 3,91,81,389/ - . DURING THE COURSE OF SURVEY NEITHER THE METHOD ADOPTED BY THE AO NOR MATHEMATICAL CALCULATION GIVEN BY THE AO , WAS NOT SUPPORTED BY ANY EVIDENCE . THE AO IN HIS OR DER DID NOT ACCEPT THE GP RATE @12.11% DECLARED BY THE ASSESSEE DESPITE THE FACT THAT GROSS PROFIT OF THE ASSESSEE IN PREVIOUS YEARS WAS AS UNDER: - . 2007 - 08 - 12.23 2008 - 09 - 6.79 2009 - 10 - 9.07 2010 - 11 - 12.11 17. AVERAGE G.P RATE OF PRECEDING FOUR Y EARS (2007 - 08 TO 2010 - 11), WHICH IS COMPUTED WITH THE HELP OF ABOVE DATA VARIES FROM 6.79% TO 12.23% . THEREFORE, THE G.P DECLARED BY THE ASSESSE SHOULD HAVE BEEN ACCEPTED. THE ASSESSEES CONTENTION AND ADDITIONAL EVIDENCE AS SUBMITTED BY THE ASSESSE DURING THE APPELLATE PROCEEDINGS WERE DULY EXAMINED BY THE AO IN REMAND PROCEEDINGS. THE REMAND REPORT AS SUBMITTED BEFORE THE LD. CIT - A BY THE AO DOES NOT GIVE ANY ADVERSE FINDINGS AGAINST THE ASSESSEE. THE ADDITION WAS MADE ON ACCOUNT OF STOCK DIFFERENCE, WIT HOUT ANY SUPPORTING EVIDENCE /DOCUMENTS . EVEN DURING THE SURVEY OPERATION , THE SURVEY TEAM HAS F AILED TO CO - RELATE WITH STOCK DIFFERENCE WITH ANY TANGIBLE MATERIAL/EVIDENCE. WE NOTE THAT EXCISE DUTY AND TAXES SHOULD BE INCLUDED IN PURCHASES AND IN THE CASE OF SALES TO REDUCE THE CURRENT STOCK. NEITHER THE REVENUE CONSIDERED THE DUTY AND TAXES AT THE TIME OF SURVEY OPERATION NOR AT THE TIME OF ASSESSMENT PROCEEDINGS. THEREFORE, INADVERTENTLY GROSS MISTAKES HAS BEEN MADE BY 9 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 9 THE AO WHILE PASSING THE ORDER. THE REFORE, CONSIDERING THE FACTUAL POSITION AND ADDITIONAL EVIDENCE AS SUBMITTED BY THE ASSESSE DURING THE APPELLATE PROCEEDINGS, WE NOTE THAT THE AO WAS NOT CORRECT TO STATE THAT THE STOCK REGISTER WAS NOT MAINTAINED BY THE ASSESSEE. WE ALSO NOTE THAT THE AD DITIONAL EVIDENCE SUBMITTED BY THE ASSESSE E VIDE PAGES 173 - 302 (PAPER BOOK - 2) DURING THE APPELLATE PROCEEDINGS, WHICH IS THE STOCK REGISTER OF ASSESSEE FOR THE PERIOD ENDING 31 - 03 - 2010. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE IMPUGNED ORDER OF THE L D. CIT(A). HIS ORDER ON THIS ISSUE IS HEREBY UPHELD. GROUND NO. 2 RAISED BY THE REVENUE IS DISMISSED. 1 8 . GROUND NO.3 RELATES TO CHARGING OF INTEREST U/S. 234B OF THE ACT. 19. WE NOT THAT THIS ISSUE IS COVERED BY THE JUDGMENT OF THE HONBLE JURISDICTI ONAL HIGH COURT OF JHARKHAND IN THE CASE OF SHRI AJAY PRAKASH VERMA IN T.A NO. 38 OF 2010 REPORTED IN (013)(1) TM1 140, WHICH DIRECTS THE AO TO CHARGE INTEREST U/S. 234B OF THE ACT ONLY ON RETURNED INCOME AND NOT ON THE ASSESSED INCOME. RESPECTFULLY FOLLOW ING THE ABOVE, WE DIRECT THE AO TO DO SO. GROUND NO. 3 OF THE REVENUE IS DISMISSED. 20 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22 - 0 2 - 2019 SD/ - SD/ - ( S. S. GODARA ) (DR. A.L.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 22 - 0 2 - 2019 10 ITA NO . 26/RAN/16 M/S. HARD ROCK FABRICATION PVT. LTD PAGE 10 *PRADIP (SR.PS) COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT/ DEPARTMENT: DCIT, CIR - 1, 47, C.H AREA, JSR - 831 001. 2 THE RESPONDENT/ ASSESSEE : M/S. HARD ROCK FABRICATION (P) LTD, NO.A - 33/34P, PHASE - 6, GAMHARIA, JSR - 832108 . 3. THE CIT - , 4. THE CIT(A) - , 5. DR, RANCHI BENCHES, RANCHI TRUE COPY, BY ORDER, SENIOR P.S ITAT, RANCHI BENCHES