The ACIT, Circle-4, Ahmedabad V. Gopinath Chem-Tech Ltd., Ahmedabad

ITA 3212/AHD/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6809 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-04-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 07-04-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 12-09-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K DHANISTA
• Assessee Lawyers: SUNIAL H TALATI
• Keywords: Unexplained investment; Document seized; Additional evidence; Documents seized
• Section: 143(3); 11A; 133A; 12A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD (BEFORE S/SHRI G. D. AGARWAL, VP AND BHAVNESH SAINI , JM) ITA NO.3212/AHD/2008 A. Y.: 2004-05 THE A. C. I. T., CIRCLE-4, 1 ST FLOOR, NAVJIVAN TRUST BUILDING, OFF. ASHRAM ROAD, AHMEDABAD 380 014 VS GOPINATH CHEM-TECH LTD., 7 TH FLOOR, 704 ATMA HOUSE, ASHRAM ROAD, AHMEDABAD PA NO. AAACG 3945 M (APPELLANT) (RESPONDENT) APPELLANT BY SHRI R. K. DHANISTA, DR RESPONDENT BY SHRI SUNIAL H. TALATI, AR O R D E R PER BHAVNESH SAINI: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LEARNED CIT(A)-VI II, AHMEDABAD DATED 16-06-2008 FOR ASSESSMENT YEAR 2004-05 ON THE FOLLOWING GROUND: 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON THE FACT S OF THE CASE IN DIRECTING THE ASSESSING OFFICER TO REST RICT THE ADDITION OF RS.15,96,807/- TO RS.1,55,370/- ON ACCO UNT OF EXCESS STOCK AND TO RS.9,400/- AGAINST RS.1,09,081/ - ON ACCOUNT OF DEFICIT OF STOCK FOUND. 2. THE FACTS OF THE CASE ARE THAT A SURVEY WAS COND UCTED U/S 133A OF THE IT ACT IN THE PREMISES OF THE ASSESSEE ON 11 -12-2003. IN RESPECT OF SOME OF THE ITEMS THE QUANTITY OF STOCK WAS FOUND TO BE MORE THAN THE QUANTITY AVAILABLE IN THE BOOKS OF AC COUNTS AND IN THE CASE OF SOME OF THE ITEMS THE QUANTITY OF STOCK AVA ILABLE WAS LESS ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 2 THAN THE QUANTITY MENTIONED IN THE BOOKS OF ACCOUNT . THE ASSESSEE EXPLAINED THAT THE PART OF THE ITEMS WAS USED AS IN TERMEDIATE IN THE PRODUCTION OF SOME OF THE ITEMS AND SOME OF THE STO CK WAS SENT FOR JOB WORK. HOWEVER, THE AO NOTED THAT THE ASSESSEE F AILED TO PRODUCE ANY EVIDENCE IN THAT REGARD AND NO SUCH EXPLANATION WAS GIVEN AT THE TIME OF SURVEY. THEREFORE, THE ASSESSEES EXPLANATI ON WAS REJECTED AND THE EXCESS STOCK OF RS.15,96,807/- WAS ADDED A S UNACCOUNTED INVESTMENT AND FOR THE DEFICIT OF STOCK OF RS.13,33 ,519/- THE AO MADE ADDITION OF GP AT 8.18% OF RS.13,33,519/- I.E. RS.1 ,09,081/-. 3. THE ASSESSEE CHALLENGED THE ADDITIONS BEFORE THE LEARNED CIT(A) AND FILED DETAILED SUBMISSIONS ON WHICH THE LEARNED CIT(*A) ALSO CALLED FOR THE COMMENTS OF THE AO. THE LEARNED CIT(A) REPRODUCED THE SUBMISSION OF THE ASSESSEE AND REMAN D REPORT OF THE AO IN THE IMPUGNED ORDER WHICH READS AS UNDER: 4.1 DISPUTING THE ABOVE ADDITIONS THE A.R. SUBMITT ED THAT A STATEMENT OF MR. BHUPEN M. SHAH, DIRECTOR OF THE APPELLANT COMPANY WAS RECORDED ON THE DATE OF SURVE Y AND WITH REGARD TO THE POSITION OF STOCK IN REPLY T O QUESTION NO.31, MR. BHUPEN M. SHAH HAD REPLIED AS UNDER: 'Q.31. WE HAVE BEEN INFORMED BY THE OFFICERS CONDUC TING SURVEY AT YOUR FACTORY PREMISES IN KADI, THAT THERE IS A STOCK DIFFERENCE. WHAT DO YOU WANT TO SAY IN THIS M ATTER? A.31 AFTER VERIFICATION OF THE STOCK AND RECORDS , IF THERE IS ANY DISCREPANCY NOTICED IN THE STOCK, THE SAME W ILL BE SATISFACTORILY CLARIFIED.' 4.2 DURING THE COURSE OF THE ASSESSMENT PROCEE DINGS, THE A.O. ASKED THE APPELLANT TO EXPLAIN THE DISCR EPANCY ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 3 BETWEEN THE PHYSICAL STOCK AND STOCK AS PER BOOKS. IN REPLY, THE APPELLANT GAVE DETAILED REPLY, WHICH HAS BEEN REPRODUCED BY THE A.O. AT PAGES 3 AND 4 OF THE ASSESSMENT ORDER AS UNDER: 'WE ARE MANUFACTURER OF DYE INTERMEDIATES AND CHEMICALS SUCH AS ONCBSA, OASPA, 6 NAPSA, 6 ACETYL OAPSA EBAMSA, STA, PNCBOSA, 4 CAPSA & 2 NAPSA & 2 NADPSA ETC. IN THIS WE HAVE TO STATE THAT ONCBSA IS FINISHED PRODUCT AS WELL AS RAW MATERIAL FOR OAPSA, OAPSA IS FINISH AS WELL AS RAW MATERIAL FOR 6 NAPSA, 6NAPSA IS FINISH AS WELL AS FINISH FOR 6 ACE TYL OAPSA SO IN ANNEXURE D-L, OAPSA STOCK IS EXCESS BY 3462 KGS. WHERE AS IN ANNEXURE D-LL, OAPSA IS SHORT AGE BY 2382 KGS. WHICH CLEARLY JUSTIFIES THAT THERE IS NO SHORTAGE BUT IT EXCESS OF OAPSA. FOR THE SHORTAGE O F PRODUCT 4-ASPSA WE HAVE TO STATE THAT WE HAVE SENT THIS PRODUCT ON JOB WORK BASIS TO M/S. SHREEJI ENTERPRIS E ALONG WITH EXCISE JOB WORK CHALLAN BEARING NO. 737 ON 10- 12- 2003 FOR 3850 KGS. WHICH IS ACCOUNTED IN EXCISE REC ORD ALSO. FURTHER WE HAVE TO STATE THAT OLUEM IS SENT F OR JOB WORK TO M/S. SHAH INDUSTRIES 8150 KGS ON 10-12-2003 VIDE JOB WORK CHALLAN NO. 735 DTD. 10-12-2003 AND C AN 4500 KGS IS SENT FOR JOB WORK BASIS TO SHREEJI ENTE RPRISE VIDE J.W. CHALLAN NO. 736 DTD 10-12-2003. SO SHORTA GE IN THOSE 3 PRODUCTS NAMELY 4-ADPSA, CAN & OLEUM IS DUE TO CLERICAL MISTAKE FOR NON ACCOUNTING IN THE B OOKS ON 10-12-2003, COPY OF THE CHALLANS OF THE DISPATCHED GOODS ARE ENCLOSED HERE WITH FOR YOUR READY REFERENCE. WE FURTHER STATE THAT MINOR SHORTAGE OR EXCESS IN R AW MATERIALS LIKE OLEUM, SUPLHURIC ACID, WNA, CAN, MCB , CAUSTIC LYE, ACETIC ANHYDRIDE, HCL ETC. ARE LIQUID PRODUCTS AND ARE STORED IN TANKS & SINCE WE ARE SMA LL SCALE INDUSTRY , WE HAVE NOT MADE ANY ARRANGEMENT / FACILITY FOR MEASURING EXACT QUANTITY OF LIQUID PRO DUCTS STOCKS LYING IN THE TANK AND THEREFORE THE QUESTION ABOUT ITS ACTUAL MEASUREMENT AT THE TIME OF PHYSICAL VERI FICATION BY YOUR DEPARTMENT AND SO MENTIONED IN PANCHNAMA IS TOTALLY INCORRECT/ DOUBTFUL FOR EXACT ACCURACY/ ANY ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 4 CALIBRATION OF THE TANKS AND HENCE IT IS NOT AT ALL POSSIBLE TO JUSTIFY PHYSICAL VERIFICATION OF STOCK STORED IN THE HORIZONTAL TANKS. FURTHER STATE THAT QUANTITATIVE CONSUMPTION OF RAW MATERIAL IS ALSO VARIES FROM BAT CH TO BATCH DEPENDING UPON FREE-ACIDITY OF MATERIAL AND F REE- ACIDITY IN THE INTERMEDIATE STAGE OF PRODUCTS AND A S IT IS TAKEN BY PUMPS TO DIRECTLY TO THE VESSEL WHICH ARE ALSO NOT CALIBRATED SO ACTUAL CONSUMPTION OF RAW MATERIA L DIFFERS AND WE USUALLY TAKE STOCK OF THE PRODUCTS 4 TIMES IN A YEAR AND ACCORDING TO APPROXIMATE MEASUREMENT WE HAVE TO ACCOUNT FOR CONSUMPTION OF RAW MATERIALS. S O EXACTLY DO TO DOT CONSUMPTION IS NOT POSSIBLE IN OU R FACTORY. ALTHOUGH CERTAIN TIME WHEN TANKS GET FULLY EMPTY WE ARE ABLE TO JUDGE EXACT CONSUMPTION OF RAW MATER IAL IN OUR DIFFERENT BATCHES AND ACCORDINGLY WE ACCOUNT SHORTAGE OR EXCESS OF RAW MATERIALS IN THE BOOKS. F URTHER, WE HAVE TO STATE THAT SEQUENCE 10 OF THE ANNEXURE D -1 PRODUCT 2 NAPDSA THE PHYSICAL STOCK OF 2375 KGS. WE RE AS PER BOOKS IT IS NIL THEN ALSO SHORTAGE IS SHOWN THROUGH IT IS EXCESS, SIMILARLY SAME AS CASE FOR SR.NO. 16 FOR ANNEXURE D-LL, PRODUCT SALT AS PER BOOKS STOCK IS N IL WHERE AS PHYSICAL STOCK IS 14300 ALTHOUGH THIS SHOWN AS SHORTAGE IN PANCHNAMA.' 5. THE A.O. HOWEVER DID NOT ACCEPT THE EXPLANATIO N OF THE APPELLANT AS IT WAS NOT, SUPPORTED BY ANY EVIDE NCE. 6. BEFORE ME THE LEARNED A.R. MADE DETAILED SUBMISSIONS BY WAY OF WRITTEN SUBMISSIONS DATED 27 TH NOVEMBER, 2007LIHD SUBMITTED THAT SINCE COPIES OF T HE PAPERS SEIZED BY THE SURVEY TEAM LIKE STOCK RECORDS MAINTAINED BY THE CHEMIST, BATCH REPORTS AND INCOMPLETE STOCK RECORDS, WHICH WERE PREPARED AND MAINTAINED BY THE ACCOUNT CLERK HAD BEEN SEIZED AND WERE LYING WITH THE A.O. AND THE SAME WERE LATER OB TAINED AND ON THE BASIS OF SUCH SEIZED RECORDS VARIOUS EXPLANATIONS EXPLAINING SO CALLED EXCESS AND DEFICI T STOCK WERE EXPLAINED TO THE A.O. THE APPELLANT SUBMITTED THAT THE ABOVE PAPERS WERE NOTHING BUT PART OF THE SAME RECORD WHICH WERE SEIZED BY THE SURVEY TEAM AND ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 5 AVAILABLE WITH THE A.O. AS MOST OF THE DETAILS COUL D NOT BE FILED BY THE APPELLANT AT THE TIME OF ASSESSMENT PROCEEDINGS DUE TO PAUCITY OF TIME, THE SAME WERE ADMITTED AS ADDITIONAL EVIDENCE AND THE WRITTEN SUBMISSIONS OF THE APPELLANT AND COPIES OF THE AFOR ESAID DOCUMENTS WERE FORWARDED TO THE A.O. FOR HIS COMMEN TS VIDE LETTER DATED 15-1-2008. IN THE REMAND REPORT D ATED 26-05-2008, THE A.O. HAS OFFERED HIS COMMENTS AS UN DER: '2. WITH REFERENCE TO THE ABOVE LETTER, A LETTER WA S SENT TO THE ASSESSEE COMPANY ON 6TH FEBRUARY, 2008 WHEREIN VIDE PARA 2 OF THE SAID LETTER IT WAS BROUGHT TO THE NOTICE OF THE ASSESSEE:- 'ON GOING THROUGH THE ORDER SHEET IT IS SEEN THAT T HE PROCEEDINGS HAVE TAKEN PLACE ON 29-8-2006, 11-9- 2006, 27-9-2006, 9-10-2006, 19-10-2006, 01-11- 2006, 13-11-2006, 6-12-2006, 13-12-2006, 22-12- 2006 AND 29-12-2006. THE ORDER U/S. 143(3) WAS PASSED ON 29-12-2006'. IT WAS ALSO POINTED OUT THE ASSESSEE COMPANY:- 'THE LD. CIT(A)-VIII, AHMEDABAD HAS COMMUNICATED AS MOST OF THESE PAPERS COULD NOT BE FILED AT THE TIME OF ASSESSMENT PROCEEDINGS DUE TO PAUCITY OF TIME THE SAME ARE ADMITTED AS ADDITIONAL EVIDENCE'. 3. IN THE LIGHT OF ABOVE MENTIONED DETAIL OF PROCEE DINGS THE ASSESSEE COMPANY WAS DIRECTED TO JUSTIFY THE PA UCITY OF TIME AT THE TIME OF ASSESSMENT PROCEEDINGS WHICH PREVENTED IT FROM FILING THEM BEFORE ASSESSING OFFI CER SO THAT NECESSARY COMMENTS CAN BE OFFERED TO THE IN TH E FORM OF REMAND REPORT. 4. IN RESPONSE TO THE ABOVE INQUIRY THE ASSESSEE COMPANY VIDE LETTER DATED 15TH FEBRUARY, 2008 SUBMI TTED. 'WITH REFERENCE TO THE SUBJECT STATED ABOVE AND YOUR LETTER UNDER REFERENCE PLEASE NOTE THAT ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 6 NOTWITHSTANDING VARIOUS DATES OF HEARING MENTIONE D BY YOU IN THE ABOVE LETTER WE HAVE TO SUBMIT THAT THE ORDER HAS BEEN PASSED ON 29-12-2006 AND AS PER OUR RECORD FOR TAKING THE COPIES OF PANCHNAMA, STATEMENTS AND RECO RDS THE NECESSARY CHALLAN FOR RS. 100/- WAS PAID ON 8TH DECEMBER,2006 WHICH WAS SUBMITTED TO YOU ON -11-12- 2006, IT MAY ALSO BE STATED THAT THE THEN ASSES SING OFFICER HAD MET WITH AN ACCIDENT AND WAS ABSENT FOR SEVERAL DAYS AS PER OUR INFORMATION. IT WAS ONLY TH EREAFTER THAT WE COULD OBTAIN THE COPIES AND FROM THE SAME O N THE BASIS OF VERIFICATION THEREAFTER THE MISTAKES AND E RRONEOUS ADDITION MADE IN THE ASSESSMENT ORDER COULD BE ASCERTAINED. WHILE WE HAVE ALREADY FURNISHED MOST OF THE DETAILS, THE EXPLANATION REGARDING THE DISCREPA NCIES IN THE STOCK OF RAW-MATERIALS AND FINISHED GOODS WHICH HAS BEEN ERRONEOUSLY ADDED DURING THE COURSE OF THE ASSESSMENT COULD BE EVALUATED WITH REFERENCE TO THE COPIES OF THE PAPERS RECEIVED AND WHICH WE HAVE ALR EADY EXPLAINED IN THE SUBMISSION TO THE APPELLATE AUTHOR ITY IN GREAT DETAILS WITH REFERENCE TO OUR REGULAR BOOKS A ND REGISTERS, A COPY OF WHICH UNDERSTAND IS FORWARDED TO YOU. AGAIN IT MAY BE STATED THAT THE DISCREPANCY HA S BEEN FULLY EXPLAINED AND THE CORRECT POSITION OF STOCK C OULD BE BROUGHT TO THE NOTICE AFTER GETTING FULL RECORDS FR OM THE DEPARTMENT BY PAYING NECESSARY COPYING CHARGES FOR THE DOCUMENTS ON 7TH MARCH.,2007. WE ENCLOSE HEREWIT H THE COPIES OF BOTH THE CHALLANS AS WELL AS FORWARDI NG LETTER, WHICH WOULD PROVE BEYOND DOUBT THAT OPPORTU NITY GIVEN TO US WAS QUITE INADEQUATE TO EXPLAIN THE COR RECT POSITION OF THE FACTS.' 5. AFTER VERIFICATION OF THE RECORD AND PERSONNEL DISCUSSION WITH THE THEN ASSESSING OFFICER MR. JAME S KURIAN, ACIT, IT IS GATHERED THAT THOUGH HE HAS MET WITH AN ACCIDENT BE WAS NOT ON LEAVE FOR SEVERAL DAYS AS CLAIMED BY THE ASSESSEE COMPANY. HENCE THE STATEMEN T OF THE ASSESSEE 'THE ASSESSING OFFICER WAS ABSENT FOR SEVERAL DAYS' IS A FACTUALLY INCORRECT STATEMENT. ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 7 6. WITHOUT PREJUDICE TO THE ABOVE, IT CAN BE SEEN T HAT THE ASSESSEE HAS NOT CARED TO OBTAIN THE COPIES OF THE SEIZED MATERIAL REQUIRED FOR ITS DEFENSE THOUGH THE SURVEY OPERATION HAS TAKEN PLACE AS EARLY AS ON 11-12-2003 AND DISCREPANCIES WERE NOTICED AND BROUGHT TO ITS NOTIC E. THE ASSESSMENT PROCEEDINGS HAD BEEN PUT TO MOTION BY IS SUE AND SERVICE OF NOTICE U/S. 143(2) AS EARLY AS 12TH SEPTEMBER,2005 AND IT WAS FINALIZED U/S. 1433) OF T HE ACT ON 29-12-2006 I.E. 16 MONTHS TIME WAS AVAILABLE TO THE ASSESSEE COMPANY FOR OBTAINING THE COPIES AND PUT UP IS DEFENSE. IT IS NOT CLEAR HOW AND IN WHICH REFERENCE THE ASSESSEE COMPANY IS REFERRING TO 7TH MARCH, 200 7 AS THE ASSESSMENT ORDER WAS PASSED ON 29-12-2006. 7. THE INCIDENT OF AN ACCIDENT TO THE THEN ASSESSI NG OFFICER AS LATE AS 12TH DECEMBER, 2006 AND HIS ALLE GED ABSENCE FROM DUTY FOR SEVERAL DAYS IS NOT A VALID G ROUND FOR NOT OBTAINING THE COPIES OF SEIZED MATERIAL REQ UIRED BY THE ASSESSEE COMPANY FOR ITS DEFENSE. THUS THE ASSESSEE WAS NOT PREVENTED FROM SUFFICIENT CAUSE FR OM SUBMITTING THE DOCUMENTS BEFORE ASSESSING OFFICER. IT WILL BE MORE APPROPRIATE TO TERM IT AS A PLOY OF THE ASS ESSEE TO RAISE DISPUTE REGARDING THE DISCREPANCIES NOTICE D IN THE STOCK DURING THE COURSE OF ASSESSMENT PROCEEDINGS A T APPELLANT STAGE. THE THEORY OF 'PAUCITY OF TIME' PROPOUNDED BY THE ASSESSEE COMPANY FOR ADMISSION OF ADDITIONAL EVIDENCES AT APPELLATE STATE IS BASEL ESS. THE CIRCUMSTANCES NATTERED FOR ADMISSION OF NEW / ADDITIONAL EVIDENCES WERE ABSENT AND ADMISSION OF NEW EVIDENCES IS STRONGLY OBJECTED TO. 8. IN THE OPENING PARAGRAPH OF ITS SUBMISSIO N THE ASSESSEE COMPANY HAS STATED:- 'FURTHER TO THE STATEMENT OF FACTS AND GROUNDS OF A PPEAL, WE HUMBLY SUBMIT AS UNDER. THE DETAILS GIVEN UNDER ARE ON THE BASIS OF XEROX PAPERS OF SEIZED DOCUMENTS RECEIVED FROM INCOME TAX DEPARTMENT. ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 8 THAT THERE IS ABSOLUTELY NO EXCESS OF EITHER FINISH ED GOODS OR RAW-MATERIALS IN RESPECT OF WHICH AN ADDIT ION OF RS. 15,96,807/- HAS BEEN MADE BY THE ASSESSING OFFI CER. SIMILARLY, ADDITION OF RS. 1,09,081/- WITH RESPECT TO DEFICIT OF FINISHED GOODS AND RAW MATERIALS IS ALSO INCORRE CT BOTH ON THE BASIS OF FACTS AND FIGURES & ACCORDING TO TH E LAW.' 9. THIS STATEMENT OF ASSESSEE COMPANY IS FACTUALLY INCORRECT. AS PER ASSESSEE'S OWN SUBMISSION VIDE LE TTER DATED 27TH 'NOVEMBER, 2007 ALONG WITH ENCLOSURES, I T HAS ADMITTED STOCK DISCREPANCIES IN RESPECT OF EACH AND EVERY ITEM WHERE THE STOCK DISCREPANCIES ARE NOTICED BY T HE SURVEY PARTY AND ADDITIONS ARE MADE BY ASSESSING OFFICER. THE ASSESSEE COMPANY HAS ATTRIBUTED THE SHORTAGE TO MANUAL ERROR OF CHARGING WEIGHING/ MIXI NG / DRYING OF FINISH PRODUCTS, CAPTIVE CONSUMPTION OF S OME OF THE .FINISHED PRODUCTS, SALE AFTER DRYING. BUT EXCE PT A MERE STATEMENT THE ASSESSEE COMPANY HAS NOT ADDUCED ANY EVIDENCE IN SUPPORT TO ITS CLAIM. 10. THE EXPLANATION GIVEN BY THE ASSESSEE COMPANY I N THE CASE OF EXCESS/ DEFICIT *- .STOCK OF FINISHED P RODUCT AS WELL AS RAW MATERIAL IS MORE OR LESS STEREOTYPE. HE NCE FOR THE SAKE OF, CONVENIENCE, THE EXPLANATION GIVEN BY THE ASSESSEE COMPANY IS REPRODUCED BELOW IN PARAGRAPHS NO. 1.1 TO 14. IN PARAGRAPH NO. 15 THE CONCLUSION O F THE ASSESSEE COMPANY IS REPRODUCED. THE COMMENTS ARE CONTAINED IN PARA 16 & 17. 11. EXPLANATION REGARDING EXCESS STOCK PHYSICAL STOCK OF FINISHED PRODUCT FOUND AT THE TIME OF SURV EY. (I) OAPSA 3462 KGS. THE ASSESSEE COMPANY HAS VIDE LETTER DATED NOVEMBER , 2007 SUBMITTED AS UNDER. AS CAN BE SEEN FROM PAGE NO. 8 OF THE, PAPER TAKEN BY SURVEY TEAM IN ANNEX-DL THE PHYSICAL QUANTITY FOUND AT THE TIME OF SURVEY WAS 15367 KG. AS AGAINST 11905 K G AS ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 9 PER BOOKS AND THEREBY DIFFERENCE OF 3462.KG WAS WOR KED OUT. HOWEVER, AS PER PAGE NO. 9A & 9B BENG DETAILED EXPLANATION IT CAN BE SEEN THAT THERE WAS 1400 KG F OR WHICH EFFECT WAS NOT GIVEN BY THE STOCKIEST IN THE BOOKS COMPRISING OF 650 KG AND 750 KG RECEIVED FROM PRODUCTION BUT NOT ACCOUNTED BY THE CLERK. AS CAN BE SEEN FROM COLUMN NO.LL, THE SAME CAN BE SEEN FROM PAGE NO. 20 OF THE SEIZED STOCK RECORDS OF CHEMIST. HAVING CONSIDERED THAT 1400 KG. AND IN THE SAME ITE M AT PAGE 9A. ANNEX. D2, THERE WAS A SHORTAGE OF 2382 KG . THEREFORE, THE NET RESULT OF THIS ITEM IS (3462-238 2) T080 KG. EXCESS. AS AGAINST THIS IF ENTRY OF 1400 AS STA TED ABOVE IS CONSIDERED, WHICH WAS LEFT TO BE ENTERED T HERE WILL BE A SHORTAGE OF 320 KG. ONLY AS STATED IN COL UMN NO. 9. THIS SHORTAGE ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING/ WEIGHING / MIXING / DRYING OF FINISH PRODUCTS. WE ALSO FURTHER CLARIFY THAT OUR FINISH PRODUCTS ARE CAPTIVELY CONSUMED OR SOLD AFTER DRYING. LIKE OAPSA IS CAPTIVELY CONSUMED FOR MANUFACTURING OF 6 NAPSA AND OAPSA HAS BEEN ALSO SOLD AFTER DRYING ON 100% BASIS (REAL BASIS)' (II) ONCBSA 856 KG 'ONCBSA- EXCESS 856 KG:- AS CAN BE SEEN FROM PAGE NO. 8 THERE WAS EXCESS OF 856 KG. IN THE SAID ITEM AS PER PHYSICAL VERIFICATION. 'THERE WAS CONSIDERING EXCESS OF 856 KG. AT PAGE NO . 8 AT ANNEX. DL AND ANOTHER EXCESS OF 9910 IN PAGE NO. 7 ANNEX-D2 TOTALING TO 10766. NOW AS PER EXPLANATION IN CHART AT PAGE NO. 10A, 10D & 10E THERE WERE VARIOUS ENTRIES OF 4000 KG 1980 KG, 2200 KG AND 2320 KG. FO R WHICH THE ENTRY WAS NOT MADE BY THE STOCKIEST THOUGH IT WAS RECEIVED FROM THE PRODUCTION IN THE MONTH OF DECEMBER,03. BECAUSE THE, - ABOVE ENTRIES RELATE TO VARIOUS BATCHES OF PRODUCTION IN THE MONTH OF DECEM BER DURING WHICH PERIOD THE ACCOUNTANT WAS ABSENT. THIS WAS ALSO EXPLAINED DURING THE COURSE OF STATEMENT RECOR DED ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 10 DURING THE SURVEY. HOWEVER, ALL THE ABOVE ENTRIES H AD ALREADY BEEN PROPERLY TAKEN AND AS A RESULT THE DIFFERENCE IS ONLY OF 266 KG EXCESS, WHICH HAD BEEN TAKEN IN THE STOCK REGISTER FROM 12-12-2003. THIS EXCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING/ WEIGHING/ MIXING/ DRYING OF FINISH PRODUCTS. WE ALS O FURTHER CLARIFY THAT OUR FINISH PRODUCTS ARE CAPTIV ELY CONSUMED OF SOLD AFTER DRYING, LIKE ONCBSA IS CAPTIVELY CONSUMED FOR MANUFACTURING OF OAPSA AND ONCBSA HAS BEEN ALSO SOLD AFTER DRYING ON 100% BASIS (REAL BASIS.) III. 6 NAPSA -EXCESS 1031 KG. 'AS CAN BE SEEN FROM ANNEX. DL ON PAGE NO. 8 THERE WAS EXCESS SHOWN IN THE SAID PAPER DURING THE COURSE O F SURVEY. SIMILARLY, THERE WAS ANOTHER EXCESS IN ANNE X. D2 ON PAGE NO. 7 OF 1124 KG. MAKING A TOTAL OF 2255 KG . OUR EXPLANATION FOR THE SAME IS AS UNDER ON PAGE NO , 11A & 11D ITEMS OF 941 KG. 989 KG. AND 650 KG REMAINED TO BE ENTERED BY THE STOCKIST BEING PRODUC TION FOR THE MONTH OF DECEMBER, 03 DURING WHICH ACCOUNTA NT REMAINED ABSENT. THIS FACT WAS EXPLAINED DURING THE STATEMENT RECORDED AT THE TIME OF SURVEY. AS A RESU LT THE NET RESULT IS SHORTAGE 25 KG. ONLY. ALL THE THREE E NTRIES HAD ALREADY BEEN PROPERTY TAKEN, WHICH HAD BEEN TAKEN I N THE STOCK REGISTER FROM 12-12-2003. THIS EXCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING/ WEIGHING/ MIXIN G/ DRYING OF FINISH PRODUCTS. WE ALSO FURTHER CLARIFY THAT OUR FINISH PRODUCTS ARE CAPTIVELY CONSUMED OR SOLD AFTER DRYING. LIKE 6 NAPSA IS CAPTIVELY CONSUMED FOR MANUFACTURING OF 6 ACETY OAPSA AND 6 NAPSA HAS BEEN ALSO SOLD AFTER DRYING ON 100% BASIS (REAL BASIS.) IV. EBAMSA-937KG. EXCESS AS REGARDS THIS ITEM IT IS SUBMITTED THAT THERE WAS 400 KG. OLD WASTE LOT WAS MISSED AND WAS NOT ACCOUNTED BY THE ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 11 ACCOUNTANT IN THE STOCK REGISTER. THE BALANCE 537 K G. IS NOT TRACEABLE. THIS MAY BE A CLERICAL MISTAKE. IN V IEW OF THE ABOVE FACTS AND ALSO CONSIDERING THE PECULIAR N ATURE OF THE BUSINESS AND THIS EXCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING / WEIGHING/ MIXING/ DRYING OF FINISH PRODUCTS AND THE DEFICIENCIES, WHICH WERE PROPERLY CORRECTED IN THE BOOKS AND STOCK RECORDS, THERE IS NO QUESTION OF ANY INVESTMENT IN THE STOCK AND F INISHED GOODS AS ALLEGED BY THE ASSESSING OFFICER. 12. EXPLANATION REGARDING EXCESS PHYSICAL STOC K OF RAW MATERIAL FOUND AT THE TIME OF SURVEY. RAW MATERIAL QUANTITY 1. SULPHURIC ACID 950 KG 2. CAUSTIC SODA LYE 3165 KG 3. H. C. L. 17745 4. CAUSTIC SODA FAX 4475 5. ONCBSA 9910 6. 6 NAPSA 1224 7. SALT 14300 I. SULPHURIC ACID-950 KG., CAUSTIC SODA LYE-3165 K G. H.C.L. 17745 AS REGARDS THESE ITEMS ALL THESE ITEMS ARE IN LIQUI D FORM AND SAME ARE LYING IN THE - HORIZONTAL TANK. AS A M ATTER OF FACT MEASUREMENT WAS TAKEN ONLY OF APPROXIMATE BASI S WITHOUT ANY CALIBRATION OF TANK AND IS NOT CORRECT IN WHOLESOME BUT WAS AN ESTIMATE. DETAILED EXPLANATION HAS ALREADY BEEN GIVEN OF THESE ITEMS TO THE ASSESS ING OFFICER, WHICH HAS BEEN REPRODUCED BY HIM AT PAGE 4 OF ASSESSMENT ORDER. WE FURTHER STATE THAT PRODUCT BEI NG LIQUID AND CHARGING, OF PRODUCT IN THE BATCH CARRIE D OUT ON APPROXIMATE BASIS. SO THERE ARE -CHANCES OF MANUAL ERROR AND THIS PRODUCT ARE BEING' HAZARDOUS IN NATURE THE RE IS NO POSSIBILITIES OF RECEIVING GOODS IN SMALL QUANTI TY, AS IT ALWAYS PURCHASED IN TANKER LOAD (BULK QUANTITY) CONSIDERING THE ABOVE FACTS THERE IS NO EXCESS. ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 12 AS REGARDS SULPHURIC ACID, CAUSTIC SODA LYE H.C.I, CHEMICALS THE SAID ITEMS ARE LIQUID ITEM AND EXACT MEASUREMENT IS NEVER POSSIBLE. ALSO VALUE OF THE SA ME IS HARDLY RS. 21- PER KG RS. 12/- PER KG & RS. 0.60 PE R KG. WHICH HAS NO SUBSTANTIAL COMMERCIAL VALUE. II. CAUSTIC SODA FLAX - EXCESS 4475 KG. 'AS CAN BE SEEN FROM PAGE 'NO. 7 OF THE PAPER TAKEN BY SURVEY TERN IN ANNEX. D2 THE PHYSICAL QUANTITY FOUN D AT THE TIME OF SURVEY WAS 14200 KG. AS AGAINST 9725 KG AS PER BOOKS AND THEREBY DIFFERENCE OF 4475 KG. WAS WO RKED OUT. HOWEVER, AS PER PAGE NO. 12A , 12C & 12D BEING DETAILED EXPLANATION IT CAN BE SEEN THAT THERE WAS 4250 KG. WHICH WAS ISSUED IN THE STOCK RECORD BY THE ACCOUNTANT BUT NOT CONSUMED AS PER CHEMIST REPORT I N THE BATCH NO. 5/12 TO 11/12 SHOWN IN COLUMN NO.L1, THE SAME CAN BE SEEN FROM PAGE NO. 20 OF THE SEIZED STO CK RECORDS OF CHEMIST. THEREFORE, THE NET RESULT OF TH IS ITEM IS (9725 + 4250) 13975 KG. AS AGAINST THIS IF ENTRY OF 4250 AS STATED ABOVE IS CONSIDERED WHICH WAS ENTERED THE RE WILL BE AN EXCESS OF 225 KG. ONLY AS STATED IN COLU MN NO. 9 THIS EXCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING WEIGHING / MIXING ETC. III. ONCBSA-EXCESS 9910 KG. AS CAN BE SEEN FROM PAGE NO. 7 THERE WAS EXCESS OF 9910 KG. IN THE SAID ITEM AS PER PHYSICAL VERIFICAT ION OUR EXPLANATION FOR THE SAME IS AS UNDER. THERE WAS CONSIDERING EXCESS OF 9910 KG. AT PAGE NO . 7 AT ANNEX. D2 AND ANOTHER EXCESS OF 856 IN ANNEX-DL TOTALING TO 10766. NOW AS PER EXPLANATION IN CHART PAGE NO. 10A, 10D & 10E THERE WERE VARIOUS ENTRIES OF 40 00 KG. 1980 KG. 2200 KG. AND 2320 KG. FOR WHICH THE EN TRY WAS NOT MADE BY THE STOCKIEST THOUGH IT WAS RECEIVE D FROM THE PRODUCTION IN THE MONTH OF DECEMBER 2003 BECAUSE THE ABOVE ENTRIES RELATE TO VARIOUS BATCHES OF PRODUCTION IN THE MONTH OF DECEMBER DURING WHICH PE RIOD ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 13 THE ACCOUNTANT WAS ABSENT. THIS WAS ALSO EXPLAINED DURING THE COURSE OF STATEMENT RECORDED DURING THE SURVEY. HOWEVER, ALL THE ABOVE ENTRIES HAD ALREADY BEEN PROPERLY TAKEN AND AS A RESULT THE DIFFERENCE IS ON LY OF 266 KG. EXCESS WHICH HAD BEEN TAKEN IN THE STOCK REGIST ER FROM 12-12-2003 . THIS EXCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING / WEIGHING/ MIXING/ DRYING OF FINISH PRODUCTS. WE ALSO FURTHER CLARIFY THAT OUR \ I',\ FINISH PRODUCTS ARE CAPTIVELY CONSUMED OR SOLD AFTER DRYIN G. LIKE ONCBSA IS CAPTIVELY CONSUMED FOR MANUFACTURING OF GAPS A AND ONCBSA HAS BEEN ALSO SOLD AFTER DRYING O N 100% BASIS (REAL BASIS)'. IV. 6 NAPS A-EXCESS 1224 KG. 'AS CAN BE SEEN FROM PAGE NO. 7 ANNEX.D2 THERE WAS EXCESS SHOWN IN THE SAID PAPER DURING THE COURSE OF SURVEY. SIMILARLY, THERE WAS ANOTHER EXCESS IN ANNE X-DL OF 1031KG MAKING A TOTAL OF 2255 KG. OUR EXPLANATIO N FOR THE SAME IS UNDER: ON PAGE NO. 11A & 1ID 3 ITEMS OF 941 KG 689 KG AND 650 KG REMAINED TO BE ENTERED ' BY THE STOCKIEST BEING PRODUCTION FOR THE MONTH OF DECEMBER, 2003 DURING W HICH ACCOUNTANT REMAINED ABSENT. THIS FACT WAS EXPLAINED DURING THE STATEMENT RECORDED AT THE TIME OF' SURVE Y. AS A RESULT THE NET RESULT IS SHORTAGE -25 KG ONLY. ALL THE THREE ENTRIES HAD ALREADY BEEN PROPERTY TAKEN, WHICH HAD BEEN TAKEN IN THE STOCK REGISTER FROM 12-12-2003. THIS E XCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING/ WEIGHI NG/ MIXING/ DYING OF FINISH PRODUCTS. WE ALSO FURTHER C LARIFY THAT OUR FINISH PRODUCTS ARE CAPTIVELY CONSUMED OR SOLD AFTER DRYING. LIKE 6-NAPSA IS CAPTIVELY CONSUMED FO R MANUFACTURING OF 6-ACETY OAPSA AND 6-NAPSA HAS BEEN ALSO SOLD AFTER DRYING ON 100% BASIS (REAL BAS IS.) V. SALT IN THIS CONNECTION WE HAVE TO STATE THAT TH IS IS NOT A RAW MATERIAL. IT IS PARTICULARLY USED FOR MIX ING AND ISOLATRERIM MANUFACTURING OF DYE INTERMEDIATES. THI S IS ALSO HAVING NO MORE SUBSTANTIAL SALES VALUE. ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 14 13. EXPLANATION REGARDING DEFICIT IN STOCK OF FINIS HED GOODS FOUND DURING THE COURSE OF SURVEY WE GIVE HER EIN BELOW THE EXPLANATION REGARDING ERRONEOUS HOLDING O F DEFICIT STOCK WORKED OUT BY THE LEARNED ASSESSING O FFICER. WE ENCLOSE HEREWITH ANNEX-C BEING SUM TOTAL OF 7735 KG. FINISHED GOODS ALLEGED TO BE IN DEFICIT WHICH COMPRISES OF 6 DIFFERENT ITEMS AS BELOW. SR. NO. PRODUCT QUANTITY 1. 6 ACLAP 399 KGS 2. 4 ADPSA 3903 KGS. 3. 2 NADPSA 2375 KGS 4. STA 93 KGS. 5. PCBSA 964 KGS 6. 4 CAPSA 1 KG. I. 6 ACLAP 399 KG. AS CAN BE SEEN FROM PAGE NO. 8 OF THE PAPER TAKEN B Y SURVEY TEAM IN ANNEX. DL THE PHYSICAL QUANTITY FOUN D AT THE TIME OF SURVEY WAS 21849 KG. AS AGAINST 22248 K G AS PER BOOKS AND THEREBY DIFFERENCE OF 399 KG. WAS WOR KED OUT . HOWEVER, AS PER PAGE NO. 13A, 13B, 13C & 13D BEING DETAILED EXPLANATION IT CAN BE SEEN THAT THER E WAS 475 KG WAS SOLD TO PARTY (EMCO DYESTUFF) FOR WHICH EFFECT WAS NOT GIVEN BY THE STOCKIST IN THE BOOKS. AS CAN BE SEEN FROM COLUMN NO. 11, THE SAME CAN BE SEEN FROM PAGE NO. 30 OF THE SEIZED STOCK RECORDS OF CHEMIST A-2 IN PANCHNAMA. THEREFORE, THE NET RESULT OF THIS ITEM I S (22248-21849) 76 KG EXCESS ONLY AS STATED IN COLUMN NO. 9. THIS EXCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING/ WEIGHING / MIXING / DRYING OF FINISH PROD UCTS. II. 4 ADPSA -3903 'AS CAN BE SEEN FROM PAGE NO. 8 OF THE PAPER TAKEN BY SURVEY TEM IN ANNEX-DL THE PHYSICAL QUANTITY FOUND AT THE TIME OF SURVEY WAS 7450 KG. AS AGAINST 11,353 K G AS PER BOOKS AND THEREBY DIFFERENCE OF 3903 KG. WAS WO RKED OUT. HOWEVER, AS PER PAGE NO. 14A, 14B, 14C & 14D ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 15 BEING DETAILED EXPLANATION IT CAN BE SEEN THAT THER E WAS 3850 KG WAS SENT TO PARTY (SHREEJI ENTERPRISE) FOR JOB- WORK VIDE JOB WORK CHALLAN NO. 737 DTD 10-12-2003, FOR WHICH EFFECT WAS NOT GIVEN BY THE STOCKIEST IN THE BOOKS. AS CAN BE SEEN FROM COLUMN NO. 11, THE SAME CAN BE SEEN FROM PAGE NO. 34 OF THE SEIZED STOCK RECORDS O F CHEMIST A-15 IN PANCHNAMA>=JHEREFORE, THE NET RESUL T OF THIS ITEM IS (7503-7450) 53 KG. EXCESS ONLY AS STAT ED IN COLUMN NO. 9. THIS EXCESS ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING/ WEIGHING/ MIXING/ DRYING OF FINI SH PRODUCTS. DETAILED EXPLANATION HAS ALREADY BEE GIVE N OF THESE ITEMS TO THE ASSESSING OFFICER, WHICH HAS BEE N REPRODUCED BY HIM ON PAGE 4 OF ASSESSMENT ORDER. III. 2NADPSA-2375 AS CAN BE SEEN FROM PAGE NO. 8 OF THE PAPER TAKEN B Y SURVEY TERN IN ANNEX-DL THE PHYSICAL QUANTITY FOUND AT THE TIME OF SURVEY WAS 2375 KG AS AGAINST 0 KG AS P ER BOOKS AND THEREBY DIFFERENCE OF 2375 KG. WAS WORKED OUT. ACTUALLY THIS ITEM WAS EXCESS BUT SHOWN DEFICIT WRO NGLY. HOWEVER, AS PER PAGE NO. ISA , 15B & 15C BEING DETA ILED EXPLANATION IT CAN BE SEEN THAT THERE WAS 2375 KG W AS RECEIVED FROM PARTY (R.P. CHEMICAL) FOR WHICH EFFEC T WAS NOT GIVEN BY THE STOCKIST IN THE BOOKS. AS CAN BE S EEN FROM COLUMN NO. 11, THE SAME CAN BE SEEN FROM PAGE NO. 39 OF THE SEIZED STOCK RECORDS OF CHEMIST A-2 I N PANCHNAMA. THEREFORE, THE NET RESULT OF THIS ITEM I S (2375-2375) O.KG. EXCESS ONLY AS STATED IN COLUMN N O.3. IV. STA-93, PNCBSA-964&4CAPSA-1 AS REGARDS THESE ITEMS ARE CONSUMED IN BATCHES. THI S MAY HAVE DUE TO COMMUNICATION GAP BETWEEN PRODUCTIO N PEOPLE & ACCOUNT STAFF. THIS SHORTAGE ALSO MAY BE D UE TO MANUAL ERROR OF CHARGING/ WEIGHING/ MIXING/ DRYING OF FINISH PRODUCTS. STOCKIEST IS MAKING THE CONSUMPTIO N ENTRY ON BASE OF FIXED RATIOS, BUT THERE MAY BE VARIATION IN REAL CONSUMPTION. SO THE DEFICIT IN ABOVE THREE ITEMS CA N'T TREAT AS SALES. ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 16 14. EXPLANATION REGARDING DEFICIT IN STOCK OF RAW M ATERIAL FOUND DURING THE COURSE OF SURVEY. THE EXPLANATION OF THE ASSESSEE COMPANY REGARDING ERRONEOUS HOLDING OF DEF ICIT STOCK IN ITS OPINION AS WORKED OUT BY THE LEARNED ASSESSING OFFICER IS REPRODUCED BELOW, 'WE ENCLOSE HEREWITH ANNEX.-D BEING SUM TOTAL OF 17681 KG. RAW MATERIAL GOODS ALLEGED TO BE IN DEFICIT WHICH COMPR ISES OF 6 DIFFERENT ITEMS AS BELOW. SR. NO. PRODUCT QUANTITY 1. OAPSA -2382 2. OLEUM -8259 3. WEAK NITRIC ACID -1999 4. CON. NITRIC ACID -3555 5. MONO CHLORO BENEZE -381 6. C. I. P. -1100 7. HYDRO - 5 (I) OAPSA 2382 KG. AS CAN BE SEEN FROM PAGE NO.7 OF THE PAPER TAKEN BY SURVEY TEAM IN ANNEX-D2 THE PHYSICAL QUANTITY FOUND AT THE TIME OF SURVEY WAS 2250 KG. AS AGAINST 4632 KG. AS PER BOOKS AND THEREBY DIFFERENCE OF 2382 KG. WAS WO RKED OUT. HOWEVER, AS PER PAGE NO. 9A & 9B BEING DETAILE D EXPLANATION IF CAN BE SEEN THAT THERE WAS 1400 KG. FOR WHICH EFFECT WAS NOT GIVEN BY THE STOCKIEST IN THE BOOKS COMPRISING OF 650 KG AND 750 KG RECEIVED FROM PRODUCTION BUT NOT ACCOUNTED BY THE CLERK. AS CAN B E SEEN FROM COLUMN NO.11, THE SAME CAN BE SEEN FROM PAGE NO.20 OF-THE SEIZED STOCK RECORDS OF CHEMIST. HAVING CONSIDERED THAT 1400 KG. AND IN THE SAME ITE M AT PAGE 8 ANNEX.D-2 THERE WAS A SHORTAGE OF 2382 KG. THEREFORE, THE NET RESULT OF THIS ITEM IS (3462-238 2) 1080 KG. EXCESS. AS AGAINST THIS IF ENTRY OF 1400 ASSTA TED ABOVE IS CONSIDERED, WHICH WAS LEFT TO BE ENTERED T HERE WILL BE A SHORTAGE OF 32(TKG. ONLY AS STATED IN COL UMN NO.9. THIS SHORTAGE ALSO MAY BE DUE TO MANUAL ERROR OF CHARGING/WEIGHING/MIXING/DRYING OF FINISH PRODUCTS. WE ALSO FURTHER CLARIFY THAT OUR FINISH PRODUCTS ARE C APTIVELY ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 17 CONSUMED OR SOLD AFTER DRYING, LIKE OAPSA IS CAPTIV ELY CONSUMED FOR MANUFACTURING OF 6-NAPSA AND OAPSA HAS BEEN ALSO SOLD AFTER DRYING ON 100% BASIS (REAL BASIS)'. (II) 'OLEUM - 8259, WEAK NITRIC ACID-1999, CON. NIT RIC ACID - 3555 & MONO CHLORO BENZENE - 381 AS REGARDS THESE ITEMS ALL THESE ITEMS ARE IN LIQUI D FORM AND SAME ARE LYING IN THE HORIZONTAL TANK. AS A MAT TER OF FACT MEASUREMENT WAS TAKEN ONLY OF APPROXIMATE BASI S WITHOUT ANY CALIBRATION OF TANK AND IS NOT CORRECT IN WHOLESOME BUT WAS AN ESTIMATE. DETAILED EXPLANATION HAS ALREADY BEEN GIVEN OF THESE ITEMS TO THE ASSESS ING OFFICER, WHICH HAS BEEN REPRODUCED BY HIM ON PAGE N O.4 OF ASSESSMENT ORDER. WE FURTHER STATE THAT PRODUCT BEING LIQUID AND CHARGING OF PRODUCT IN THE BATCH CARRIED OUT ON APPROXIMATE BASIS. SO THERE ARE CHANCES OF MANUAL E RROR AND THIS PRODUCT ARE BEING HAZARDOUS IN NATURE THER E IS NO POSSIBILITIES OR RECEIVING GOODS IN SMALL QUANTITY, AS IT ALWAYS PURCHASED IN TANKER LOAD (BULK QUANTITY). CONSIDERING THE ABOVE FACTS THERE IS NO EXCESS. ALSO OLEUM 8150 KG. HAS ISSUED TO SHREEJI ENTERPRIS E FOR JOB WORK VIDE CHALLAN NO. 735 DT. 10.12.2003 (PAGE NO. 16 , 16B & 16C) NOT ACCOUNTED BY STOCKIST. CON. NIT RIC ACID 4500 G. ISSUED TO SHREEJI ENTERPRISE FOR JOB W ORK VIDE CHALLAN NO.736 DT. 10.12.2003 (PAGE NO. 17A, 17B, 1 7C & 17D). DETAILED EXPLANATION HAS ALREADY BEEN GIVEN OF THESE ITEMS TO THE ASSESSING OFFICER, WHICH HAS BEE N REPRODUCED BY HIM ON PAGE 3 & 4 OF ASSESSMENT ORDER . (III) C.I.P.-1100KG. & HYDRO-5KG. AS REGARDS THESE ITEMS ARE CONSUMED IN BATCHES. THI S MAY HAVE DUE TO COMMUNICATION GAP BETWEEN PRODUCTIO N PEOPLE & ACCOUNT STAFF, STOCKIEST IS MAKING THE CONSUMPTION ENTRY ON BASE OF FIXED RATIOS, BUT THER E MAY BE VARIATION IN REAL CONSUMPTION. SO THE DEFICIT IN ABOVE ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 18 THREE ITEMS CAN'T TREAT AS SALES. THIS SHORTAGE ALS O MAY BE DUE TO MANUAL ERROR OR CHARGING/WEIGHING/MIXING ETC. (15) THE ASSESSEE COMPANY CONCLUDED BY SUBMITTI NG 'IT IS THEREFORE REQUESTED THAT THE ADDITION OF RS. 905055/- & RS.428464/- BEING TOTALLY INCORRECT AND THE SAME BE DELETED AS SALES AND ALSO CONSIDERING THE PECULIAR NATURE OF THE BUSINESS AND THE DEFICIENCIES, WHEN WERE PRO PERLY CORRECTED IN THE BOOKS AND STOCK RECORDS, THERE IS NO QUESTION OF ANY SALES OR PURCHASE MADE OUT OF BOOKS OF ACCOUNT AS ALLEGED BY THE ASSESSING OFFICER. IT IS THEREFORE REQUESTED THAT THE ADDITION OF RS.1,09,08 1/- IN G.P. BEING TOTALLY INCORRECT AND THE SAME BE DELETE D'. (16)(I) AMONG MANY REASONS GIVEN FOR DETECTION OF DISCREPANCIES IN THE STOCK ONE OF ' THEM IS THE ENT RIES NOT MADE BY EMPLOYEES IN RESPECTIVE RECORD. MR. BHUPEN SHAH IS THE MAIN PERSON RESPONSIBLE FOR MANAGING THE SHOW OF THE ASSESSEE COMPANY AS WELL A S MANY OTHER RELATED CONCERNS. SHRI PRADUMANSINGH K. PARMAR EXCISE CLERK HAS IN HIS STATEMENT STATED THA T HE IS WRITING EXCISE RECORDS AS PER DIRECTION OF HIS EMPL OYER MR. BHUPEN SHAH. IN HIS STATEMENT MR. BHUPEN SHAH H AS TAKEN FULL RESPONSIBILITY AND IN RESPONSE TO QUESTI ON NO. 30 & 31 STATED THAT AFTER VERIFICATION OF BOOKS OF ACCOUNTS THE QUERY REGARDING DISCREPANCIES IN THE STOCK WILL BE SATISFACTORILY ANSWERED. NOW HE HAS TREAJE UP WITH THE EXPLANATION THAT DUE TO MISTAKE OF HIS EMPLOYEES CE RTAIN ENTRIES HAVE REMAINED TO BE MADE IN RESPECTIVE RECO RD. THE EXPLANATION IS WITH RESPECT TO WHATEVER ENTRIES WERE FOUND TO HAVE BEEN MADE AT THE TIME OF SURVEY AND PHYSICAL STOCK FOUND AT THE TIME OF SURVEY. NO INDEPENDENT EVIDENCE IS ADDUCED IN SUPPORT TO VARIO US CLAIMS MADE BY HIM IN RESPECT OF STOCK DISCREPANCIE S NOTICED IN VARIOUS ITEMS OF FINISHED PRODUCTS AND R AW MATERIAL. HENCE IN ABSENCE OF ANY CORROBORATIVE ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 19 EVIDENCES, THE EVIDENTLY VALUE OF WHATEVER STATED B Y THE ASSESSEE COMPANY IS 'NIL'. (II) WHERE IT WAS NOT POSSIBLE TO OFFER ANY EXPLANA TION, THE ASSESSEE COMPANY TOOK ONE COMMON STAND I.E. ANOTHER COMMON STAND TAKEN BY HIM IS IT MAY BE DUE TO MANUA L ERROR OF CHARGING/WEIGHING/MIXING/DRYING OF FINISH PRODUCTS. (III) IN THE CASE OF DISCREPANCIES IN CASE OF LIQUI D ITEMS THE ASSESSEE COMPANY HAS GIVEN EXPLANATION THAT THESE ITEMS ARE IN LIQUID FORM AND SAME ARE LYING IN THE HORIZONTAL TANK. AS A MATTER OF FACT MEASUREMENT WA S TAKEN ONLY O APPROXIMATE BASIS WITHOUT ANY CALIBRAT ION OF TANK AND IS NOT CORRECT IN WHOLESOME BUT WAS AN EST IMATE. (VI) IN SOME CASES SOME OF THE ITEMS, THE ASSESSEE COMPANY HAS NOT OFFERED ANY EXPLANATION. THE ASSESSEE'S EXPLANATION IS NOT ACCEPTABLE FOR TH E SIMPLE REASON THAT THERE A SYSTEM OF MEASUREMENT OF LIQUID LYING IN CYLINDRICAL TANKS WHICH IS KNOWN AS 'DEEP' METAL MARKED RODS ARE PROVIDED BY THE MANUFACTURES MANUFACTURING AND SUPPLYING SUCH CYLINDRICAL TANKS. BASED ON THE LENGTH, DEPTH AND DIAMETER OF THE TANK A TABLE IS PREPARED BASED ON MATHEMATICAL CALCULATION . BY MEASURING THE DEEP OF THE LIQUID AND APPLYING THE MATHEMATICAL FORMULAE THE EXACT QUANTITY OF LIQUID LYING IN THE TANK CAN BE MEASURED. EVEN OTHERWISE THE ASSESS EE COMPANY ITSELF HAS ACCEPTED THAT ITS ACCOUNTING SYS TEM IS FAULTY. THE ASSESSEE HAS NOT QUESTIONED THE METHOD BUT MERELY STATED THAT IT WAS ON APPROXIMATE BASIS. SIN CE THE STOCK HAS BEEN TAKEN IN THE PRESENCE OF THE ASSESSE E COMPANY'S RESPONSIBLE EMPLOYEES, THE ASSESSEE'S ARGUMENT CANNOT BE ACCEPTED. (IV) AT PLACES THE ASSESSEE COMPANY HAS STATED THAT IT WAS EXPLAINED IN THE STATEMENT RECORDED DURING THE COURSE OF SURVEY. I HAVE GONE THROUGH THE STATEMENT S. BUT ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 20 THERE IS NOTHING IN THE STATEMENTS AS CLAIMED BY TH E ASSESSEE COMPANY. (V) THE ASSESSEE COMPANY HAS AT PLACES REFERRED TO THE PAGE NO. 3 & 4 OF THE ASSESSMENT ORDER. I HAVE GONE THROUGH THE RELEVANT PAGES WHEREIN THE SUBMISSION O F THE ASSESSEE COMPANY IN DISCUSSED BY 'FEE ASSESSING OFFICER. THE SUBMISSION IS MORE IN THE FORM OF A ST ORY RATHER THAN A LEGAL SUBMISSION SUPPORTED BY EVIDENC ES. THE SUBMISSION IS BRUSH ASIDE BY THE ASSESSING OFFI CER. 17. IN VIEW OF THE ABOVE DISCUSSION THE SUBMISSION -MADE BY THE ASSESSEE COMPANY IS LACKING IN MERIT AS WELL AS EVIDENTLY VALUE AND REQUIRED, TO BE BRUSH ASIDE AND THE ASSESSMENT ORDER MADE BY THE ASSESSING OFFICER IS REQUIRED TO BE UPHELD.' THE ID. A.R. SUBMITTED THAT THE A.O. HAS NOT VERIFI ED THE EXPLANATIONS OF THE APPELLANT WITH REGARD TO THE SO CALLED EXCESS/DEFICIT STOCK ALTHOUGH THE SAID PAPERS HAD B EEN IMPOUNDED BY THE SURVEY TEAM AND WERE LYING WITH TH E A.O. AND ALTHOUGH THE APPELLANT OFFERED TO EXPLAIN THE SAME TO THE A.O. AT THE REMAND STAGE, HE CONTENDED THAT THERE WAS NO FURTHER EVIDENCE WHICH NEEDED TO BE PRODUCED BEFORE THE A.O. 4. THE LEARNED CIT(A) CONSIDERING THE WRITTEN SUBMI SSION OF THE ASSESSEE AND THE REMAND REPORT FILED BY THE AO AND THE MATERIALS ON RECORD DELETED THE SUBSTANTIAL ADDITION HOLDING THA T THE ASSESSEE IS ABLE TO RECONCILE THE DIFFERENCE ON ACCOUNT OF EXCE SS AND DEFICIT STOCK. ADDITION WAS ACCORDINGLY MODIFIED. FURTHER, GP ADDITION WAS RESULTANTLY MODIFIED. THE FINDINGS OF THE LEARNED C IT(A) IN PARA 8 TO 9 ARE REPRODUCED AS UNDER: 8. BEFORE ME THE LEARNED A.R. HAS FURNISHED WRITTE N SUBMISSIONS BY LETTER DATED 4 TH JUNE, 2008 ALONG WITH ITEM WISE EXPLANATION AND DETAILS CONSISTING OF 70 PAGES ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 21 EXPLAINING THE WORKING OF EXCESS/DEFICIT TO POINT O UT THAT THERE WAS NO EXCESS/DEFICIT TO THE EXTENT WORKED OU T BY THE A.O. HAVING CONSIDERED THE EXPLANATION WITH REFERENCE TO THE SUPPORTING PAPERS AND DOCUMENTS OBTAINED FROM THE IMPOUNDED RECORDS OBTAINED FROM T HE A.O. ON EACH ITEM, THE UNEXPLAINED EXCESS/DEFICIT W AS WORKED OUT BY THE ID. A.R. AS PER ANNEXURE-A ENCLOS ED TO THIS ORDER. 8.1 FROM THE DETAILS AS PER ANNEXURE-A AS WELL AS T HE SUBMISSION DATED 4TH JUNE, 2008 ALONG WITH ANNEXURE S, FILED BY THE A.R, THE FOLLOWING EXCESS AND DEFICIT OF STOCK IS OBSERVED : A) IN CASE OF RAW MATERIAL OAPSA EXCESS STOCK OF FINISHED GOODS WAS FOUND TO THE TUNE OF 3462 KG AND DEFICIT IN OAPSA USED AS RAW MATERIAL WAS FOUND TO THE TUNE OF 2382 KG. WHICH SHOULD BE REDUCED FROM EXCES S STOCK. IT HAS BEEN EXPLAINED THAT OAPSA TO THE TUNE OF 1400 KG WAS IN PRODUCTION BATCH. THAT LEAVES BALANC E DEFICIT OF 320 KG OF OAPSA WHICH SHOULD BE VALUED A T RS.42,560/- AND CONSIDERED FOR ADDITION . B ) IN CASE OF RAW MATERIAL EBAMSA THERE IS EXC ESS OF 937 KG WHICH HAS BEEN VALUED AT ; RS.70,275/- AS PER ANNEXURE-A. C) IN CASE OF ONCBSA EXCESS OF 856 KG HAS BEEN FOUND AS FINISHED PRODUCT. THIS IS ALSO USED AS A R AW MATERIAL FOR OAPSA AND AS RAW MATERIAL 9910 KG. OF IT WAS FOUND EXCESS. THUS TOTAL EXCESS IS OF 10766KG. AS PER 4 BATCHES IN PRODUCTION 10500 KG OF ONCBSA ARE IN PRODUCTION PROCESS BUT THE STAFF HAS NOT RECORDED T HE SAME IN STOCK BOOK. IF REDUCTION IS GIVEN FOR 10500 KG, NET EXCESS IS OF (10766 - 10500) = 266 KG WHOSE MONETAR Y VALUE IS RS.4682/- WHICH IS TO BE CONSIDERED FOR AD DITION. D) FOR 6N APSA DIFFERENCE IS FOUND TO BE OF 2 5KG AFTER CONSIDERING USE IN PRODUCTION. ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 22 E) FOR FOLLOWING RAW-MATERIALS,-EXCESS STOCK WA S FOUND WHICH THE APPELLANT COULD NOT EXPLAIN, SO ENTIRE DI FFERENCE IS CONSIDERED FOR ADDITION. EXCESS VALUE IN RS. SULPHURIC ACID 950 KG - 2,375/- C. S. LYE 3165KG - 16,711/- HCL - 17745KG - 17,745/- SALT - 14300KG - 8,580/- F) OUT OF DEFICIT IN STOCK IN FOLLOWING ITEMS THE APPELLANT COULD NOT EXPLAIN SO ENTIRE DIFFERENCE IS CONSIDERED FOR ADDITION. QUANTITY IN KG. VALUE IN RS . WNA - 1999 13,993/- MCB - 381 9,144/- CIP - 1100 11,000/- HYDRO - 5 300/-. G) IN CASE OF DEFICIT IN RAW MATERIAL OF OAPSA, THE APPELLANT HAS FURNISHED EXPLANATION AND IT HAS BEEN CONSIDERED AND HAS BEEN SET OFF AGAINST EXCESS STOC K OF 3462 KG FOUND IN FINISHED GOODS AS IN ITEM (A) ABOV E. H) IN CASE OF DEFICIT IN RAW MATERIALS OLEUM (8259K G) AND C. N. A. (3555KG) 8150 KG OF OLEUM AS PER PAGE 58 OF PAPER BOOK FURNISHED BY THE A. R. AND 4500 KG. O F CON. NITRIC ACID AS PER PAGE 63 OF PAPER BOOK HAVE BEEN ISSUED FOR JOB WORK, SO ONLY DIFFERENCE I.E. NET AM OUNT OF DEFICIT OF 109 KG. OF OLEUM AND EXCESS OF 945 KG. O F C. N. A. WHICH HAVE BEEN TAKEN INTO ACCOUNT IN ANNEXURE-A . 9. THE LEARNED A. R. HAS VEHEMENTLY ARGUED THAT THE MINOR DIFFERENCES WHICH STILL REMAIN ARE INEVITABLE BECAUSE OF THE NATURE OF THE PRODUCTS AND ON ACCOUN T OF MANUAL ERRORS OF CHARGING/WEIGHING/MIXING/DRYING OF FINISHED PRODUCTS. IT WAS VEHEMENTL8Y ARGUED THAT ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 23 ULTIMATELY THE STOCK HAS BEEN ACCOUNTED AND THE SAM E HAS BEEN PROPERLY DEALT WITH IN THE ACCOUNTS IN THE FORM OF SALES/CAPTIVE CONSUMPTION AND THEREFORE, SUCH DIFFE RENCE WAS OBVIOUS AND INEVITABLE LOOKING TO THE SIZE OF T HE BUSINESS CARRIED ON BY THE APPELLANT. HOWEVER, I WO ULD HOLD THAT TO THE EXTENT THE DIFFERENCE HAS BEEN EXP LAINED AT LENGTH ON EACH ITEM IN THE DETAILED LETTER DATED 4 TH JUNE, 2008 ALONG WITH SUPPORTING STATEMENTS, CHARTS AND COPIES OF THE SEIZED PAPERS LIKE CHEMISTS RECORD, STOKISTS RECORD ETC. AS WELL AS BATCH PRODUCTION R ECORDS THE DIFFERENCE IS TREATED AS EXPLAINED AND IS NOT T O BE TREATED AS UNEXPLAINED. HOWEVER, WITH REGARD TO THE DIFFERENCE STILL REMAINING AS PER THE ABOVE CHART, THE TOTAL DIFFERENCE FOR UNEXPLAINED EXCESS HAS BEEN WORKED O UT AT RS.1,55,379/- AND VALUE OF DEFICIT AMOUNTING TO RS.1,14,918/- IS TREATED AS UNEXPLAINED. I DO NOT A GREE WITH THE ARGUMENT OF THE LEARNED A.R. THAT SUCH SMA LL DIFFERENCE ALSO SHOULD NOT BE CONSIDERED AS UNEXPLA INED AS THEY ARE DUE TO REASONS LIKE MANUAL ERROR OF CHARGING/WEIGHING/MIXING/DRYING ETC. I DIRECT THE A . O. TO REDUCE THE ADDITION OF RS.15,96,807/- TO RS.1,55,37 9/-. WITH REGARD TO THE UNEXPLAINED DEFICIT OF RS.1,14,9 18/- IN STOCK ITEMS, G. P. OF 8.18% AS ADOPTED BY THE A. O. WOULD BE APPLIED WITH THE RESULT THAT A SUM OF RS.9 ,400/- WOULD RETAINED AS AGAINST THE ADDITION OF RS.1,09,0 81/- MADE BY THE A. O. THUS THE TOTAL ADDITION ON ACCOUN T OF DIFFERENCE IN STOCK SUSTAINED IS RS. 1,55,379/- AND RS.9,400/- TOTALING TO RS.1,64,779/- AS AGAINST TOT AL ADDITION OF RS.15,96,807/- PLUS RS.1,09,-81/- TOTAL ING TO RS.17,05,888/-. I DIRECT ACCORDINGLY. THIS GROUND O F APPEAL IS THEREFORE PARTLY ALLOWED. 5. THE LEARNED DR MERELY RELIED UPON THE ORDER OF T HE AO AND HAS NOT POINTED OUT ANY INFIRMITY IN THE ORDER OF THE L EARNED CIT(A). ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE ASSESSEE RE ITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND S UBMITTED THAT THE ASSESSEE RECONCILED THE ENTIRE EXCESS AND DEFIC IT STOCK AND THE ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 24 LEARNED CIT(A) ON PROPER VERIFICATION OF THE SAME A ND ON CALLING THE COMMENTS FROM THE AO RIGHTLY DELETED SUBSTANTIAL AD DITIONS. THEREFORE, THERE IS NO MERIT IN THE DEPARTMENTAL AP PEAL. HE HAS SUBMITTED THAT THE ASSESSEE HAS NOT PREFERRED ANY A PPEAL AGAINST THE PART ADDITIONS MAINTAINED BY THE LEARNED CIT(A). 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE FINDINGS OF THE AUTHORITIES BELOW. THE AO NOTED THA T DURING THE COURSE OF SURVEY QUANTITY OF THE STOCK WAS FOUND MORE THAN THE QUANTITY AVAILABLE IN THE BOOKS OF ACCOUNTS AND IN CASE OF S OME OF THE ITEMS THE QUANTITY OF THE STOCK WAS AVAILABLE WAS LESS T HAN THE QUANTITY MENTIONED IN THE BOOKS OF ACCOUNTS. THE ASSESSEE FI LED PROPER EXPLANATION BEFORE THE AO WHICH IS REPRODUCED ABOVE . THE ASSESSEE FILED FURTHER DETAILED SUBMISSIONS BEFORE THE LEARN ED CIT(A) ALONG WITH DOCUMENTS AND EVIDENCES ON WHICH COMMENTS OF T HE AO HAVE ALSO BEEN CALLED FOR. THE ASSESSEE, WITH REGARD TO EXCESS AND DEFICIT STOCK EXPLAINED EACH AND EVERY ITEM SUPPORTED BY EV IDENCES AND MATERIALS NOTED ABOVE. THE LEARNED CIT(A) ON PROPER APPRECIATION OF THE EXPLANATION AND THE MATERIAL FOUND DURING THE C OURSE OF SURVEY SPECIFICALLY DEALT WITH EACH AND EVERY ITEM OF EXCE SS AND DEFICIT OF STOCK AND CAME TO THE CONCLUSION THAT SUBSTANTIAL D IFFERENCE IS RECONCILED. THE DEPARTMENT IS IN APPEAL ON THE ABOV E GROUND. HOWEVER, NO MATERIAL OR EVIDENCE HAS BEEN FILED ON RECORD TO CONTROVERT THE FINDINGS OF THE LEARNED CIT(A) ON RE CORD. THE LEARNED DR MERELY RELIED UPON THE ORDER OF THE AO BUT HE WA S NOT ABLE TO POINT OUT ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT(A) IN MODIFYING BOTH THE ADDITIONS ON MERIT. IN THE ABSENCE OF ANY EVIDENCE AND ITA NO.3212/AHD/2008 ACIT, CIRCLE-4, AHMEDABAD VS GOPINATH CHEM-TECH LTD . 25 MATERIAL ON RECORD TO CHALLENGE THE FINDINGS OF THE LEARNED CIT(A), WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE REVENUE. THE LEARNED CIT(A) ON PROPER APPRECIATION OF THE FACTS AND EVIDENCES O N RECORD RIGHTLY DELETED THE SUBSTANTIAL ADDITIONS. IN VIEW OF THE A BOVE FACTS AND FINDING OF THE LEARNED CIT(A), WE DO NOT FIND ANY R EASON TO INTERFERE IN THE ORDER OF THE LEARNED CIT(A). THE DEPARTMENTAL A PPEAL IS ACCORDINGLY DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21-04-2011 SD/- SD/- (G. D. AGARWAL) VICE PRESIDENT (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 21-04-2011 LAKSHMIKANT/ LAKSHMIKANT/ LAKSHMIKANT/ LAKSHMIKANT/- -- - COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER DY. REGISTRAR, ITAT, AHMEDABAD