SHRI SHRI MUKESH KUMAR GOYAL, RAIPUR V. THE DY. COMMISSIONER OF INCOME TAX,-2(1), KOLKATA

ITA 325/BIL/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6574 (ITAT-RAIPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 03-11-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D K JAIN
• Assessee Lawyers: G S AGARWAL
• Keywords: Unexplained investment; Set aside
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI PARTHA SARATHI CHAUDHU RY , JM . / I TA NO . 325 /RPR /20 1 6 / ASSESSMENT YEAR : 20 1 1 - 12 MUKESH KUMAR GOYAL, 216, DESHBANDHU COMPLEX, 2 ND FLOOR, AGRASEN CHOWK, RAMSAGAR PARA, RAIPUR PAN : ADQPG6847G ....... / APPELLANT / V/S. DY. COMMISSIONER OF INCOME TAX - 2(1), RAIPUR / RESPONDENT A SSESSEE BY : SHRI G.S. AGARWAL REVENUE BY : S HRI D.K. JAIN / DATE OF HEARING : 1 5 .01.2019 / DATE OF PRONOUNCEMENT : 17 .01.2019 2 ITA NO .325 /RPR /20 1 6 / ORDER PER ANIL CHATURVEDI, AM : TH IS APPEAL FILED BY THE ASSESSEE EMANATE OUT OF THE ORDER OF COMMISSIONER OF INCOME - TAX (A) - I, RAIPUR DATED 28 - 07 - 2016 FOR A.Y. 201 1 - 12. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER : - ASSESSEE IS A N INDIVIDUAL STATED TO BE PROPRIETOR OF M/S. DAYAL GLOBAL STEEL SUPPLIERS WHICH IS ENGAGED IN THE BUSINESS OF TRADING OF IRON AND STEEL. ASSESSEE FILED HIS RETURN OF INCOME FOR A.Y. 20 1 1 - 12 ON 19 - 09 - 2011 DECLARING TOTAL INCOME AT RS. 24,88,540/ - . THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED U/S 143( 3 ) VIDE ORDER DATED 2 6 - 03 - 2014 AND THE TOTAL INCOME WAS DETERMINED AT RS. 1,91,32,940/ - . AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A), WHO VIDE ORDER DATED 21 - 04 - 2014 (IN A PPEAL NO. 36/ CIT(A) - 13/R - 45/14 - 15 ) GRANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL B EFORE US AND HAS RAISED THE FOLLOWING GROUNDS : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THAT THE LD. CIT(A) HAS ERRED IN SUSTAINING THE ADDITION MADE BY THE LD. AO AT RS.11,47,600 ON COUNT OF UNDISCLOSED INVESTMENT U/S. 69 IN FORM OF PURCHASES. 3 ITA NO .325 /RPR /20 1 6 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THAT THE LD. CIT(A) HAS ERRED IN SUSTAINING THE ADDITION MADE BY THE LD. AO AT RS.11,47,600 ON COUNT OF SALES RETURN. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THAT THE LD. CIT(A) HAS ERRED IN SUSTAINING THE ADDITION MADE BY THE LD. A O AT R S.57,71,042/ - ON COUNT OF FREIGHT CHARGES CLAIMED. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THAT THE LD. CIT(A) HAS ERRED IN SUSTAINING THE ADDITION MADE BY THE LD. AO AT RS.95,247 ON COUNT OF FREIGHT CHARGES CLAIMED. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THAT THE LD. CIT(A) HAS ERRED IN SUSTAINING THE ADDITION MADE BY THE LD. AO AT RS.82,56,694 ON COUNT OF UNEXPLAINED INVESTMENT IN STOCK. 6. THAT THE ASSESSEE CRAVES LEAVE TO ADD, ALTER, MODIFY AND WITHDRAW ANY GROUND/G ROUNDS BEFORE OR AT THE TIME OF HEARING OF THE APPEAL. 3 . BEFORE US, AT THE OUTSET THAT THE LD . AR SUBMITTED THAT DUE TO THE SMALLNESS OF AMOUNT, THE ASSESSEE DOES NOT WISH TO PRESS GROUND NO. 4. IN VIEW OF THE AFORESAID SUBMISSION, GROUND NO. 4 OF THE ASSESSEE IS DISMISSED AS NOT PRESSED. 4 . GROUND NOS. 1 AND 2 BEING INTERCONNECTED ARE CONSIDERED TOGETHER . IT IS WITH RESPECT TO ADDITION OF RS.11,47,600/ - . 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS , ON PERUSING THE P ROFIT AND L OSS ACCOUNT , THE ASSESSING OFFICER NOTED THAT IN THE PROFIT AND LOSS ACCOUNT THE ASSESSEE HAD CLAIMED PURCHASE OF RS.42,70,79,514/ - W HEREAS, DURING THE ASSESSMENT PROCEEDINGS , ASSESSEE FILED A STATEMENT OF PURCHASE SHOWING PURCHASE OF RS.43,43,30,082/ - . THE ASSESSEE WAS THEREFORE ASKED TO EXPLAIN THE DISCREPANCIES IN THE PURCHASE FIGURES AND SHOW CAUSE 4 ITA NO .325 /RPR /20 1 6 AS TO WHY THE DIFFERENCE OF PURCHASE OF RS.11,47,660/ - NOT BE TREATED AS PURCHASE FROM UNDISCLOSED SOURCES. THE ASSESSEE INTER ALIA SUBMITTED THAT THE AMOUNT OF RS.11 ,47,660/ - REPRESENTED SALES RETURN WHICH WAS ADDED BACK TO THE TOTAL PURCHASES GIVING EQUAL EFFECT TO THE STOCK IN THE BOOKS OF ACCOUNT. WHEN THESE MATERIALS WERE SOLD AGAIN TO THE CUSTOMERS IT WAS TREATED AS SALES AND THE EFFECT WAS GIVEN TO THE STOCK BOOKS. THE STATEMENT OF THE ASSESSEE WAS NOT FOUND ACCEPTABLE TO ASSESSING OFFICER. THE ASSESSING OFFICER THEREFORE CONSIDERED RS.11,47,600/ - TO BE UNVERIFIABLE PURCHASES AND MADE ITS ADDITION. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER, THE ASSESSEE C ARRIED THE MATTER BEFORE THE CIT(A). THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF ASSESSEE UPHELD THE ORDER OF ASSESSING OFFICER. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US. 6. BEFORE US, LD. A.R. REITERATED THE SUBMISSIONS MADE BEFORE ASSESSING OFFICER AND LD. CIT(A) AND FURTHER SUBMITTED THAT THE SALES MADE EARLIER WERE RETURNED BACK BY THE CUSTOMERS AND WERE REFLECTED IN THE BOOKS AS SALES RETURN BUT HOWEVER FOR THE PURPOSE OF PRESENTATION IT WAS INCLUDED IN THE PURCHASE ON ACCOUNT OF REQUIREMENT OF EXCISE LAWS. HE POINTED TO THE COPIES OF LEDGER WHICH IS PLACED IN PAGES 65 TO 73 OF THE PAPER BOOK TO DEMONSTRATE THAT IN THE BOOKS OF ACCOUNT , ASSESSEE HAD SHOWN THE AMOUNT AS SALES RETURN BUT FOR THE PURPOSE OF PRESENTATION OF 5 ITA NO .325 /RPR /20 1 6 ACCOUNT IT WAS INCLUDED IN PURCHASES AND IT WAS ONLY A REPRESENTATION ISSUE HAVING NO BEARING ON INCOME. HE FURTHER SUBMITTED THAT THE TRANSACTIONS HAVE ALREADY RECORDED IN BOOKS AND NO INSTANCES OF UNDISCLOSED INVESTMENT HAVE BEEN FOUN D BY ASSESSING OFFICER AND THERE IS NO MATERIAL TO PROVE THAT THE IMPUGNED PURCHASES HAVE NOT BEEN RECORDED IN BOOKS AND FURTHER THE CORRESPONDING SALES HAVE BEEN ACCEPTED BY REVENUE . HE FURTHER SUBMITTED THAT THE BOOKS OF ACCOUNT OF ASSESSEE ARE AUDITED AND NO DISCREPANCIES HAVE BEEN POINTED OUT BY THE AUDITORS. HE THEREFORE, SUBMITTED THAT NO ADDITION IS CALLED FOR IN THE PRESENT CASE. 7. THE LD. D.R. ON THE OTHER HAND POINTED TO THE FINDINGS OF ASSESSING OFFICER WHEREIN HE HAS NOTED THAT THE ASSESSEE HAS NOT PRODUCED THE RELEVANT DETAILS FOR VERIFICATION. HE THUS, SUPPORTED THE ORDER OF LOWER AUTHORITIES. LD. A.R. IN THE REJOINDER SUBMITTED THAT ALL THE REQUIRED DETAILS WERE SUBMITTED BEFORE LOWER AUTHORITIES. 8. WE HAVE HEA RD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS IN RESPECT OF ADDITION OF RS.11,47,600/ - . IT IS THE ASSESSEES CONTENTIONS THAT THE AMOUNT REPRESENTS SALES RETURN WHICH FOR THE PURPOSE OF PRESENTATION IN TH E PROFIT AND LOSS ACCOUNT HAS BEEN INCLUDED IN THE PURCHASE OF THE ASSESSEE. THE ASSESSEE HAS PRODUCED THE COPIES OF THE LEDGER ACCOUNT WHERE THE AMOUNT HAS BEEN SHOWN AS SALES RETURN. ASSESSEE HAS ALSO PRODUCED THE 6 ITA NO .325 /RPR /20 1 6 COPIES OF THE INVOICES AND THE CONFI RMATION OF THE PARTIES WHEREIN IT HAS BEEN CONFIRMED BY THEM THAT MATERIAL HAS BEEN RETUNED BACK BY THEM TO THE ASSESSEE. IT IS ALSO A FACT THAT THE ASSESSEE HAS MAINTAINED STOCK REGISTER , THE BOOKS OF ACCOUNT ARE AUDITED AND NO DISCREPANCIES HAVE BEEN POINTED OUT BY THE AUDITORS. IT IS ALSO A FACT THAT THE SALES HAVE BEEN ACCEPTED BY THE REVENUE. BEFORE US, REVENUE HAS NOT PLACED ANY MATERIAL ON RECORD TO DEMONSTRATE THAT THE IMPUGNED PURCHASES HAVE NOT BEEN REC ORDED IN THE BOOKS OF ACCOUNT. CONSIDERING THE TOTALITY OF AFORESAID FACTS WE ARE OF VIEW THAT ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING THE ADDITION OF RS.11,47,600/ - . WE, THEREFORE, DIRECT TO DELETE THE ADDITION. THUS, THE GROUNDS OF APPEAL NOS. 1 AND 2 ARE ALLOWED. 9. G ROUND NO. 3 IS WITH RESPECT TO ADDITION OF RS.57,71,042/ - ON ACCOUNT OF FREIGHT CHARGES. 10. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD CLAIMED FREIGHT CHARGES OF RS.57,71,042/ - . ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD BORNE THE FREIGHT CHARGES PAID TO DIFFERENT TRANSPORTERS FOR TRANSPORTING THE GOODS IT HAS SOLD THEREBY PROVIDING THEM FREE DELIVERY OF GOODS. THE ASSESSEE ALSO FURNISHED THE ADDRESSES OF PART IES TO WHOM THE GOODS WERE SUPPLIED WITHOUT CHARGING TRANSPORTATION CHARGES. AFTER PERUSING THE DETAILS FURNISHED BY THE ASSESSEE THE ASSESSING OFFICER CONCLUDED THAT THE ASSESSEE HAS SUPPLIED 7 ITA NO .325 /RPR /20 1 6 GOODS FREE OF COST WITHOUT HAVING ANY CONTRACTUAL OBLIGATION. THE ASSESSING OFFICER THEREFORE, CONCLUDED THAT THE ASSESSEE HAS FAILED TO EXPLAIN THE REASON FOR MAKING FREE SUPPLY OF GOODS TO SOME SELECT CUSTOMERS. HE THEREFORE, DISALLOWED THE FREIGHT EXPENSES OF RS.57,71,042/ - . AGGRIEVED BY THE ORDER OF ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A). THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF ASSESSEE CONFIRMED THE ORDER OF ASSESSING OFFICER BY NOTING AS UNDER : 4.3 THE APPELLANT CLAIMS THAT IN SOME CASES IT BEARS TRANSPORTATION COST OF GOODS INSTEAD OF THE BUYER INCURRING EXPENSES. APPELLANT CLAIMS THAT IT IS HIS AREA OF PRACTICE WHERE THE ASSESSEE IS THE BEST JUDGE AND THE AO CANNOT QUESTION ASSESSEES JUDGMENT. HOWEVER, I TAKE NO THAT NO BUSINESSMAN WILL BE WILLING TO INCUR LOSS IN A TRANSACTION UNLESS HE HAS BEEN COMPENSATED IN SOME WAY IN THE PROCESS. IF BUSINESSMAN HAS ACTED IN HIS BEST INTEREST AND THERE IS NOT ATTEMPT TO CAUSE LOSS TO THE REVENUE, THEN THE BUSINESSMAN SHOULD BE ABLE TO EXPLAIN WHAT BENEFIT, SUCH AS GOODWILL OR RET URN IN SOME OTHER WAY HAS BEEN DERIVED BY INCURRING THIS LOSS. THE ASSESSEE HAS TO EXPLAIN HOW THE INCURRING OF LOSS WAS HELPFUL TO HIM IN HIS BUSINESS. IT HAS ALSO CONTENDED THAT IT IS NOT PROVIDING TRANSPORT FREE DELIVERY TO ONLY ONE PARTY BUT TO SEVERAL PARTIES. ASSESSEE HAS NOT FURNISHED DETAILS OF ALL THOSE TRANSACTIONS WHERE HE HAS INCURRED TRANSPORT CHARGES. WHAT IS ON RECORD HERE, IS THAT IN THE TRANSACTION LISTED BY THE AO IN THE ASSESSMENT ORDER, AS REPRODUCED ABOVE, THE APPELLANT HAS INCURRED LOS S FOR WHICH HE HAS NO EXPLANATION OTHER THAN GENERAL REPLY. THEREFORE, AO WAS JUSTIFIED IN MAKING THE DISALLOWANCE WHICH IS HEREBY SUSTAINED. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US. 8 ITA NO .325 /RPR /20 1 6 1 1 . BEFORE US, LD. A.R. REITERATED THE SUBMISSIONS MADE BEFORE ASSESSING OFFICER AND LD. CIT(A) AND FURTHER SUBMITTED THAT THE FINDINGS OF CIT(A) THAT THE ASSESSEE DID NOT FURNISH THE REQUIRED DETAILS WHERE HE HAS INCURRED TRANSPORTATION CHARGES IS INCORRECT. HE POINTED THAT THE COPIES OF THE LEDGER ACCOUNT FILED ALONG WITH THE DETAILS PLACED AT 74 TO 78 OF THE PAPER BOOK. HE FURTHER SUBMITTED THAT THE ASSESSE HAD ALSO FILED THE DETAILS OF TRANSPORT EXPENSES AND THAT ASSESSING OFFICER DID NOT CONDUCT ANY ENQUIRY EITHER FROM THE TRANSPORTER OR FROM CUSTOMERS. HE FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS NOT BROUGHT ANY MATERIAL ON RECORD TO DEMONSTRATE THAT THE SALES WERE NOT MADE OR THE EXPENSES WERE NOT INCURRED BY THE ASSESSEE OR WERE BORNE BY THE PURCHASER. HE FURTHER SUBMITTED THAT IT IS THE BUSINESS DECISION OF THE ASSESSEE AS TO HOW THE CONDUCT THE BUSINESS AND ASSESSING OFFICER CANNOT QUESTION OF BUSINESS DECISION AND FOR THIS PROPOSITION HE RELIED ON THE DECISION OF HONBLE APEX COURT IN THE CASE OF COMMISSIONER O F INCOME TAX VS. M/S. WALCHAND & CO. (PVT.) LTD. REPORTED IN 1967 AIR 1435 AND ALSO PLACED ON RECORD THE COPY OF AFORESAID DECISION. HE THEREFORE SUBMITTED THAT NO ADDITION IS CALLED FOR IN THE PRESENT CASE. 1 2 . THE LD. D.R. ON THE OTHER HAND SUPPORTE D THE ORDER OF LOWER AUTHORITIES. 9 ITA NO .325 /RPR /20 1 6 1 3 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS IN RESPECT OF DISALLOWANCE OF TRANSPORTATION EXPENSES. IT IS REVENUES CASE THAT NO BUSINESS MAN WILL INCUR LO SS IN A TRANSACTION UNLESS HE HAS BEEN COMPENSATED IN SOME WAY IN THE PROCESS AND THEREFORE REVENUE HAS DISALLOWED THE EXPENSES. WE FIND THAT THE SALES MADE BY THE ASSESSEE TO THE PARTIES FOR WHOM THE ASSESSEE HAS BORNE TRANSPORTATION EXPENSES HAVE NOT BE EN HELD TO BE NON - GENUINE BY THE REVENUE AUTHORITIES . FURTHER IT IS NOT THE CASE OF REVENUE THAT THE AFORESAID PARTIES TO WHOM THE SALES HAVE BEEN MADE ARE RELATED PARTIES OF THE ASSESSEE. WE FURTHER FIND THAT BEFORE LOWER AUTHORITIES ASSESSEE HAD FURNIS HED THE DETAILS ABOUT THE TRANSPORTATION AND THE CUSTOMERS AND NO INQUIRY HAS BEEN MADE BY THE REVENUE AUTHORITIES F ROM THE TRANSPORTER OR FROM THE CUSTOMERS TO VERIFY THE GENUINENESS OF TRANSPORTATION . WE FURTHER FIND THAT HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. DALMIA CEMENT (BHA R AT) LTD. (2002) 254 ITR 377 ( D EL) HAS HELD THAT THE REASONABLENESS OF EXPENDITURE FOR THE PURPOSE OF BUSINESS HAS TO BE JUDGED FROM THE POINT OF VIEW OF THE BUSINESSMAN AND NOT THE REVENUE. IT HA S FURTHER HELD THAT REVENUE CANNOT JUSTIFIABLY CLAIM TO PUT ITSELF IN THE ARMCHAIR OF A BUSINESSMAN OR IN THE POSITION OF THE BOARD OF DIRECTORS AND ASSUME THE SAID ROLE TO DECIDE AS TO HOW MUCH IS A REASONABLE EXPENDITURE HAVING REGARD TO THE CIRCUMSTANCE S OF THE CASE . CONSIDERING THE TOTALITY OF AFORESAID FACTS AND RELYING ON THE AFORESAID DECISION OF HONBLE DELHI HIGH COURT WE ARE OF VIEW THAT ASSESSING OFFICER WAS NOT JUSTIFIED IN DISALLOWING 10 ITA NO .325 /RPR /20 1 6 THE FREIGHT EXPENSES OF RS.57,71,042/ - . WE, THEREFORE, DIR ECT TO DELETE THE ADDITION. THUS, THE GROUND OF APPEAL NO . 3 IS ALLOWED. 1 4 . G ROUND NO. 5 IS WITH RESPECT TO ADDITION OF RS.82,56,694/ - . 1 5 . DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD TAKEN LOAN FROM PUNJAB NATIONAL BANK AGAINST THE HYPOTHECATION OF THE STOCK. THE ASSESSEE HAD FILED STOCK STATEMENT WITH THE BANK AND A CCORDING TO WHICH THE VALUE OF STOCK OF GOODS WITH ASSESSEE WAS OF RS.2,97,96,359/ - AS AGAINST THE VALUE OF STOCK FURNISHED BEFORE REVENUE AUTHORITIES OF RS.1,50,47,914/ - . THE ASSESSEE WAS ASKED TO EXPLAIN THE DISCREPANCIES OF STOCK TO EXTENT OF RS.1,47,48,445/ - . THE ASSESSEE SUBMITTED THAT THERE WAS A CLERICAL MISTAKE WHEREIN THE STOCK OF SALE WAS VALUED AT RS.72,13,056/ - INSTEAD O F RS.7,21,305/ - DUE TO WHICH THERE WAS A DIFFERENCE OF RS. 64,91,750/ - . IT WAS FURTHER SUBMITTED THAT IN ORDER TO MAINTAIN CREDIT LIMIT THE ASSESSEE HAS INFLATED VALUE OF STOCK IN THE STOCK STATEMENT FURNISHED TO THE BANK AND THAT THE STOCK STATEMENT FURNI SHED TO BANK WAS ON ESTIMATE BASIS. THE SUBMISSIONS OF THE ASSESSEE WERE NOT FOUND ACCEPTABLE TO ASSESSING OFFICER. THE EXPLANATION OF THE ASSESSEE HAVING INFLATED THE STOCK STATEMENT SUBMITTED TO BANK FOR GETTING EXCESS OVER DRAFT FACILITY WAS ALSO NOT FOUND ACCEPTABLE TO ASSESSING OFFICER. THE ASSESSING OFFICER THEREAFTER RELYING ON THE DECISION OF KOLKATA BENCH OF TRIBUNAL IN THE CASE OF ESTEE EXPORTS (P) LTD. VS. INCOME TAX 11 ITA NO .325 /RPR /20 1 6 OFFICER IN IT APPEAL NO. 424/KOL/2012 MADE ADDITION OF RS.82,56,694/ - U/S. 69 C OF THE ACT. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A) WHO UPHELD THE ORDER OF ASSESSING OFFICER . AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US. 1 6 . BEFORE US, LD. A.R. REITERATED THE SUBMISSIONS MADE BEFORE ASSESSING OFFICER AND LD. CIT(A) AND FURTHER SUBMITTED THAT THE ASSESSEES BOOKS OF ACCOUNT ARE AUDITED AND CLOSING STOCK IS ALSO VERIFIED BY THE AUDITORS. HE FURTHER SUBMITTED THAT BOOK FIGURES ARE SUPPORTED BY THE PURCHASE AND SALE BILLS AND NO DISCREPANCIES HAVE BEEN FOUND AND NO INSTANCES OF UNRECORDED PURCHASES HAVE BEEN F OUND BY ASSESSING OFFICER. HE FURTHER SUBMITTED THAT THE STOCK STATEMENT SUBMITTED TO BANK WAS ON ESTIMATE BASIS AND THE INFLATED STOCK STATEMENT FURNISHED TO THE BANK WAS TO OBTAIN HIGHER BANK LOAN AND NO ADDITION CAN BE MADE ON THE BASIS OF INFLATED STO CK STATEMENT SUBMITTED TO BANK AND FOR WHICH HE PLACED RELIANCE ON THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. RIDDHI STEEL AND TUBES (P.) LTD. REPORTED IN (2014) 220 TAXMAN 148 (GUJARAT) AND THE DECISION OF KOL KATA TRIBUNAL IN THE CASE OF INCOME TAX OFFICER VS. MS. JEARUL HAQUE IN ITA NO. 1766/KOL/2011 FOR A.Y. 2008 - 09 ORDER DATED 20 - 11 - 2015. HE ALSO PLACED ON RECORD OF THE COPIES OF AFORESAID DECISIONS. HE THEREFORE SUBMITTED THAT THE ADDITION BE DELETED. 12 ITA NO .325 /RPR /20 1 6 1 7 . THE LD. D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF LOWER AUTHORITIES. 1 8 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS IN RESPECT OF ADDITION OF RS. 82,56,694/ - . IT IS ASSESSEES CASE THAT THE STOCK STATEMENT SUBMITTED TO THE BANK WAS INFLATED TO GET MORE CREDIT FROM THE BANK. IT IS ALSO ASSESSEES SUBMISSION THAT THE BOOKS OF ACCOUNT OF ASSESSEE ARE AUDITED AND NO DISCREPANCIES HAVE BEEN POINTED OUT BY THE AUDITORS AND THE SAME METHOD HAS BEEN CONTINUOUSLY FOLLOWED BY THE ASSESSEE FOR VALUING THE STOCK. THE AFORESAID CONTENTIONS OF ASSESSEE HAVE NOT BEEN CONTROVERTED BY REVENUE. WE FIND THAT HONBLE GUJARAT HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. RIDDHI STEEL A ND TUBES (P.) LTD. (SUPRA) HAS HELD T HAT ONLY ON ACCOUNT OF INFLATED STATEMENT FURNISHED TO BANKING AUTHORITIES FOR AVAILING OF LARGER CREDIT FACILITIES , NO ADDITION CAN BE MADE U/S. 69 C OF THE ACT . WE ALSO FIND THAT THE CO - ORDINATE BENCH OF KOLKATA TRIBU NAL IN THE CASE OF INCOME TAX OFFICER VS. MS. JEARUL HAQUE (SUPRA) AFTER CONSIDERING THE VARIOUS DECISIONS HAS HELD THAT NO ADDITION CAN BE MADE MERELY ON THE BASIS OF INFLATED HIGHER VALUE OF STOCK SUBMITTED TO THE BANK. BEFORE US REVENUE HAS NOT PLACED ANY CONTRARY BINDING DECISION IN ITS SUPPORT NOR HAS PLACED ANY MATERIAL ON RECORD TO DEMONSTRATE THAT THE AFORESAID DECISIONS REL IED UPON BY ASSESSEE HAVE BEEN OVER RULED OR SET ASIDE BY HIGHER JUDICIAL AUTHORITY. FU RTHER, REVENUE ALSO COULD NOT 13 ITA NO .325 /RPR /20 1 6 DEMONS TRATE AS TO WHY THE RATIO OF THE DECISIONS RELIED UPON BY ASSESSEE CANNOT BE APPLIED TO ASSESSEES CASE. CONSIDERING THE TOTALITY OF THE AFORESAID FACTS WE ARE OF THE VIEW THAT THE ADDITION IS NOT SUSTAINABLE IN THE PRESENT CASE AND THUS, T HE GROUND OF AP PEAL NO. 5 OF ASSESSEE IS ALLOWED. 1 9 . IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON 17 TH DAY OF JANUARY, 2019. SD/ - SD/ - PARTHA SARATHI CHAUDHURY ANIL CHATURVEDI JUDICIAL MEMBER ACCOUNTANT MEMBER / RAIPUR ; / DATED : 17 TH JANUARY, 2019 . RK / COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR, I.T.A.T., RAIPUR //TRUE COPY// / BY ORDER, / PRIVATE SECRETARY , / ITAT, RAIPUR . 14 ITA NO .325 /RPR /20 1 6 DATE 1 DRAFT DICTATED ON 1 5 .01.2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 1 6 .01 .201 9 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER