The DCIT, S.K. Circle, Himatnagar V. M/s. N.G. Projects,

ITA 3571/AHD/2007

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 5741 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2010
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 12-07-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 28-08-2007
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJEEV AGRAWAL
• Keywords: Business expenditure; Source of fund; Revised return
• Section: 40A(3); 133A; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH A BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI N.S.SAINI, ACCOUNTANT MEMBER DATE OF HEARING :12-7-10 DRAFTED ON: 1 2-7-10 ITA NO.3571 /AHD/2007 ASSESSMENT YEAR :2004-05 THE DEPUTY COMMISSIONER OF INCOME TAX,S.K.CIRCLE, AMBALAL COMPLEX,BEHIND MEHTA PETROL PUMP, HIMATNAGAR. VS. N.G. PROJECT LIMITED, MEHTAPURA CROSSING, HIMATNAGAR, DISTRICT SABARKANTHA. PAN/GIR NO. : AABCN 8366 J (APPELLANT) .. (RESPONDENT) APPELLANT BY : SHRI RAJEEV AGRAWAL, D.R. RESPONDENT BY: SHRI SAKAR SHARMA. O R D E R PER N.S.SAINI , ACCOUNTANT MEMBER :- THIS IS AN APPEAL FILED BY THE REVENUE AGAINST TH E ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-IX ,AHM EDABAD DATED 4-6-2007. 2. GROUND NO.1 OF THE APPEAL READS AS UNDER :- 1. THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS ) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECT ING THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.15,91,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNRECORDED CASH PAYMENTS MADE TO SUB- - 2 - CONTRACTORS UNDER SECTION 69 OF THE INCOME TAX ACT,1961. 3. THE BRIEF FACTS OF THE CASE ARE THAT A SURVEY UN DER SECTION 133A WAS CARRIED OUT ON 17-2-2005 AT THE BUSINESS PREMIS ES OF THE ASSESSEE WHEN THE ASSESSEE DECLARED UNDISCLOSED INCOME OF RS .82,86,000 THE DETAILS OF WHICH ARE AS UNDER :- SR.NO. PARTICULAR. AMOUNT TOTAL AMOUNT 1. 1.VRINDANVAN ENTERPRISE 2. KAYYUMKHAN 3. NITISHKUMAR G. JOSHI 22,00,000 1,00,000 2,00,000 25,00,000 2. UNACCOUNTED CASH PAYMENT TO SUB-CONTRACTOR KOTADA SITE WORK IT IS PART OF OVERALL CASH GIVEN TO SHRI GULABSINGH 4,30,000 USMANBHAI AS PER OUR RECORD, IT IS RS.1,53,000/-, WHICH IS GIVEN AND RECEIVING BACK. 71,000 CASH (TO VRUNDAVAN ENTERPRISE BY SHRI GULABSINGH RATHORE) OUT OF THIS RS.4,85,000/- IS FOR A.Y. 05-06. 7,85,000 12,86,000 3. RANJIT QUARRY WORKS (20% OF 25,00,000/-) 5,00,000 5,00,000 4. BHAGIRATHSINGH S. SHEKHAWAT RS.2,63,000/- IS FOR A.Y. 2004-05 AND RS.37,37,000/- IS FOR A.Y. 05-06. 40,00,000 40,00,000 THE INCOME OF RS. 82,86,000/- WAS DECLARED BY WAY O F FILING A REVISED RETURN FURNISHED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS. - 3 - 4. THE ASSESSING OFFICER OBSERVED THAT ON VERIFICAT ION OF REPLY GIVEN BY THE ASSESSEE IN RESPECT OF ANNEXURE X-1, X -9 AND X-15, AS- 1 TO AS-19 IT IS OBSERVED THAT THE CONTENTION OF TH E ASSESSEE IS THAT IT HAD GIVEN CASH IMPREST ADVANCE MONEY TO THE SUB-CON TRACTORS AND WHEN CHEQUES WERE ISSUED BY THE COMPANY IMPREST ADV ANCE MONEY WAS RECEIVED BACK FROM THE SUB-CONTRACTORS IN CASH. NO BOOK ENTRIES WERE MADE IN THE REGULAR BOOKS OF ACCOUNT. THE ASSE SSING OFFICER OBSERVED THAT THE CASH PAYMENTS TO THE SUB-CONTRACT ORS AS PER ANNEXURE AS-1 IS AS FOLLOWS :- PG. NO. AMOUNT. NAME OF SUB-CONTRACTOR. 3 & 9 1,65,000 ASSOCIATED CORP. 13 TO 16 4,85,000 BHARAT CONSTRUCTION 2 & 41 1,30,000 VIPUL AND ASHWIN GAJERA 45 1,00,000 TOYATO PLANT 49 & 52 65,000 LAXMI CONSTRUCTION 5 & 26 3,13,000 J.K.CONSTRUCTION 8 1,50,000 KAMLESH NATVARLAL 9 1,83,000 SURESH M. PARMAR 15,91,000 THE ASSESSING OFFICER NOTED THAT ALL THESE PAYMENTS WERE NOT RECORDED IN THE BOOKS OF ACCOUNTS. THE ASSESSEE REP LIED THAT THESE WERE COLLECTED IN CASH WHEN THE PAYMENTS WERE MADE BY CHEQUES. THEREFORE, UNRECORDED PAYMENTS TO SUBCONTRACTORS OF RS.15,91,000/- ARE DISALLOWED AND ADDED IN THE INCOME UNDER SECTIO N 69 OF THE I.T. ACT. - 4 - 5. ON APPEAL BEFORE THE LEARNED COMMISSIONER OF INC OME TAX (APPEALS),THE ASSESSEE HAS MADE IMPREST PAYMENTS FR OM THE CASH BALANCE AVAILABLE IN THE REGULAR BOOKS OF ACCOUNT, THE ASSESSING OFFICER HIMSELF HAS PRODUCED THE CASH BALANCE AFTER IMPREST PAYMENTS ON PAGE NO.9 OF THE ASSESSMENT ORDER, WHICH SHOWS T HAT THE REVISED CASH BALANCE AFTER ADJUSTMENT OF IMPREST AMOUNTS ( PAYMENTS AND REFUNDS) IS AT RS. 39,84,483/-, WHERE AS THE CASH B ALANCE OF REGULAR BOOKS AS ON 31-03-2004 IS AT RS.46,86,630/-. THE DI FFERENCE OF RS.7,03,147/- IS IMPREST GIVEN TO SUBCONTRACTORS, MANAGERS/CASHIERS AND PETTY PAYMENTS. THIS SHOWS THAT THERE IS AMPLE OF CASH AVAILABLE IN THE BOOKS TO LOOK AFTER IMPREST PAYMENTS, WHICH IS MADE IN THE DUE COURSE OF BUSINESS. THUS, THE PAYMENTS ARE NOT UNEX PLAINED, AS MENTIONED BY THE ASSESSING OFFICER UNDER SECTION 69 OF THE I.T. ACT . THE LD. ASSESSING OFFICER HAS MADE THE ADDITION ONL Y ON PRESUMPTION THAT THE IMPREST PAYMENTS ARE UNEXPLAIN ED, WHEREAS THE APPELLANT HAS ADDUCED SUFFICIENT EVIDENCES, REVISED CASH WORKINGS, WHICH PROVES THAT THE IMPREST AMOUNTS WERE GIVEN OU T OF CASH BALANCE AVAILABLE IN THE REGULAR BOOKS. IT WAS THER EFORE, PRAYED THAT THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED PAYMENT OF RS.15,91,000/- BE DELETED. 6. THE ABOVE SUBMISSION OF THE ASSESSEE WAS FORWARD ED TO THE ASSESSING OFFICER BY THE COMMISSIONER OF INCOME TAX (APPEALS) ON 25-4-07 AND THE ASSESSING OFFICER WAS ASKED TO SUBM IT HIS REPORT THEREON. THE LEARNED ASSESSING OFFICER REPLIED THAT IT IS OBSERVED FROM THE BOOKS OF ACCOUNT IMPOUNDED AT THE TIME OF SURVEY THAT CERTAIN PAYMENTS WERE MADE IN CASH BY SHRI BHAGIRAT HSINGH WHO CONFESSED THAT THE PAYMENTS WERE NOT RECORDED IN TH E BOOKS OF - 5 - ACCOUNT AS PER ANNEXURE AS-1/AS-19 . DURING THE ASS ESSMENT PROCEEDINGS THE ASSESSEE REPLIED THAT CASH PAYMENTS WERE GIVEN TO CONTRACTORS AS WHEN NEEDED. WHEN CHEQUES WERE ISSUE D FOR PAYMENT TO SUBCONTRACTORS THE CASH AMOUNTS PAID WERE RECOVE RED FROM SUBCONTRACTOR, NO BOOK ENTRY WERE MADE FOR ADVANCE GIVEN IN CASH ONLY CHEQUE ENTRIES WERE RECORDED IN THE BOOKS OF A CCOUNT. AS ASSESSEE HAD NOT MADE ANY ENTRY IN THE BOOKS OF ACC OUNT FOR CASH PAYMENT GIVEN AS ADVANCE TO SUBCONTRACTORS,THEREFOR E,RS.15,91,000/- WAS RIGHTLY ADDED IN THE TOTAL INCOME OF THE ASSESS EE. 7. IN REPLY TO THE REMAND REPORT OF THE ASSESSING O FFICER THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSESSEE V IDE SUBMISSION DATED 31-5-2007 SUBMITTED THAT THE ASSESSING OFFICE R IN THE ASSESSMENT ORDER HAD MENTIONED THAT THE CASH PAYMEN TS ARE MADE BY SHRI BHAGIRATHSINGH AS RECORDED IN SEIZED ANNEXURE AS-1 TOAS-19. THE SAME ARE DECLARED BY DIRECTOR SHRI HARENDRASING HJI AND ITS PART OF DISCLOSURE OF RS. 40 LACS AND THE ADDITION OF TH E SAME AMOUNTS TO DOUBLE ADDITION. THEREFORE, RS.15.91 LACS BE SET OF F FROM THE DISCLOSURE OF RS.40 LACS AND RELIEF OF RS.37.37 LAC S BE GIVEN AND IN THIS PLACE PAYMENT OF RS.20,00,000/- TO M/S. KIRIT CONSTRUCTION CO. AND PAYMENT OF RS.15.91 LACS TOTALLING TORS.35.91 L ACS BE ADDED. THE EXTRA RELIEF OF RS.1.46 LACS IS OFFERED AS MISCELLA NEOUS. DISCLOSURE FOR ASSESSMENT YEAR 2004-05 SO THAT THERE WILL BE RELIE F OF RS.37.37 LACS AND ADDITION OF RS.37.37 LACS AND THE CONTENTS OF T HE DISCLOSURE WILL BE CHANGED AND THERE WILL BE NO EFFECT ON THE DISCL OSURE OF RS.40 LACS. 8. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE ADDITION OF RS.15,91,000/- WHILE OBSERVING AS U NDER :- - 6 - 5.4. I HAVE CAREFULLY CONSIDERED THE OBSERVATIONS OF THE A.O. WHILE MAKING THE ADDITION, SUBMISSION OF THE APPELL ANT- COMPANY BEFORE A.O. AND BEFORE ME AND ARGUMENTS OF THE LD. A.R. THE A.O. HAS MADE ADDITION FOR PAYMENT IN CA SH BY SHRI BHAGIRATHSINGH AND MADE ADDITIONOFRS.15,91,000/- ON ACCOUNT OF CASH PAYMENTS GIVEN AS ADVANCES TO SUBCONTRACTOR S RECORDED IN ANNEXURE AS-1 IS PART OF DISCLOSURE OF RS.40 LAC S MADE BY DIRECTOR SHRI HARENDRASINGH ON THE BASIS OF STATEME NT OF SHRI BHAGIRATHSINGH, WHICH IS OFFERED BY APPELLANT-COMPA NY IN THE REVISED RETURN, WHERE AMOUNT OF RS.82.86 LACS WAS O FFERED AS ADDITIONAL INCOME. THIS INCLUDED CASH PAYMENTS BY BHAGIRATHSINGH OF RS.40 LACS. THE APPELLANT HAS PLE ADED THAT THIS AMOUNTS TO DOUBLE ADDITION AS IT WAS OFFERED B Y APPELLANT IN THE DISCLOSURE OF RS.40 LACS AND AGAIN IT IS SEP ARATELY ADDED BY THE A.O. I AGREE WITH THE VIEWS OF THE APPELLANT . THE APPELLANT-COMPANY HAS MADE A DISCLOSURE OF RS. 40 L ACS ON ACCOUNT OF ADVANCE PAYMENTS TO SUBCONTRACTORS BY SH RI BHAGIRATHSINGH AS RECORDED IN ANNEXURE AS-1, WHICH IS OFFERED BY APPELLANT-COMPANY IN THE REVISED RETURN. THUS, THIS AMOUNTS TO DOUBLE ADDITION BECAUSE ONCE IT IS OFFER ED BY APPELLANT IN THE DISCLOSURE OF RS.40 LACS, IT CANNO T BE SEPARATELY ADDED BY THE ASSESSING OFFICER. THEREFORE, THE ADDI TION OF RS.15,91,000/- MADE FOR CASH PAYMENTS TO SUBCONTRAC TORS BY SHRI BHAGIRATHSINGH IS DELETED, BEING PART OF DISCL OSURE OF RS.40 LACS. 9. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTE D THE ORDER OF THE ASSESSING OFFICER AND THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSESSEE SUPPORTED THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE A SURVEY ACTION WAS CARRIED OUT UNDER SECTION 133A OF THE ACT AT THE BUSINESS P REMISES OF THE ASSESSEE ON 17-2-2005. ACCORDING TO THE LEARNED ASS ESSING OFFICER - 7 - THE ASSESSEE DISCLOSED UNDISCLOSED INCOME OF RS.40 LACS FOR THE YEAR UNDER CONSIDERATION AS UNDER :- SR.NO. PARTICULAR. AMOUNT TOTAL AMOUNT 1. 1.VRINDANVAN ENTERPRISE 2. KAYYUMKHAN 3. NITISHKUMAR G. JOSHI 22,00,000 1,00,000 2,00,000 25,00,000 2. UNACCOUNTED CASH PAYMENT TO SUB-CONTRACTOR KOTADA SITE WORK IT IS PART OF OVERALL CASH GIVEN TO SHRI GULABSINGH 4,30,000 USMANBHAI AS PER OUR RECORD, IT IS RS.1,53,000/-, WHICH IS GIVEN AND RECEIVING BACK. 71,000 CASH (TO VRUNDAVAN ENTERPRISE BY SHRI GULABSINGH RATHORE) 3,00,000 8,01,000 3. RANJIT QUARRY WORKS (20% OF 25,00,000/-) 5,00,000 5,00,000 4. BHAGIRATHSINGH S. SHEKHAWAT. 2,63,000 2,63,000 TOTAL 40,64,000 11. THE ASSESSING OFFICER OBSERVED THAT AS PER ANNE XURE AS-1 SEIZED AT THE TIME OF SURVEY THE ASSESSEE HAD MADE ADVANCE PAYMENTS IN CASH TO SUBCONTRACTORS OF RS.15,91,000/- WHICH W ERE NOT ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS BY THE ASSESSEE. THE D ETAILS OF SUCH ADVANCES ARE AS FOLLOWS :- PG. NO. AMOUNT. NAME OF SUB-CONTRACTOR. 3 & 9 1,65,000 ASSOCIATED CORP. 13 TO 16 4,85,000 BHARAT CONSTRUCTION - 8 - 2 & 41 1,30,000 VIPUL AND ASHWIN GAJERA 45 1,00,000 TOYATO PLANT 49 & 52 65,000 LAXMI CONSTRUCTION 5 & 26 3,13,000 J.K.CONSTRUCTION 8 1,50,000 KAMLESH NATVARLAL 9 1,83,000 SURESH M. PARMAR 15,91,000 12. THE ASSESSEE EXPLAINED BEFORE THE LEARNED ASSES SING OFFICER THAT IT HAD ALREADY MADE DISCLOSURE OF SUCH ADVANCE S IN THE DISCLOSURE OF RS.40 LACS MADE FOR ADVANCES GIVEN BY SHRI BHAGI RATHSINGH S. SHEKHAWAT. THE LEARNED ASSESSING OFFICER DID NOT AC CEPT THE EXPLANATION OF THE ASSESSEE AS IN HIS VIEW THE ADVA NCES MADE WERE OTHER THAN THE ADVANCES FOR WHICH DISCLOSURE WAS MA DE BY THE ASSESSEE. THEREFORE, HE MADE ADDITION OF RS.15,91,0 00/- TO THE INCOME OF THE ASSESSEE AS UNDISCLOSED INCOME. 13. IN APPEAL THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS) DELETED THE ADDITION OBSERVING THAT THE ADVANCES OF RS. 15,91,000/- ARE COVERED BY THE DISCLOSURE OF RS.40 LACS MADE BY THE ASSESSEE IN THE NAME OF BHAGIRATHSINGH SHEKHAWAT OF RS.40 LACS . ACCORDING TO THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) THE DISCLOSURE OF RS.40 LACS MADE BY THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION WAS AS UNDER :- SR.NO. NAME 1 CASH PAYMENT BY BHAGIRATHSINGH FOR FINANCIAL YEAR 2003-04 A.Y. 2004-05 PAYMENTS RECORDED TO A.Y.2004- 05 2,63,000 - 9 - KIRIT CONSTRUCTION CO. 20,00,000 PAYMENTS TO SUBCONTRACTORS AS RECORDED IN ANNEX. AS-1. 15,91,000 MISCELLANEOUS DISCLOSURE. 1,46,000 TOTAL AMOUNT. 40,00,000 14. WE FIND THAT THE REVENUE HAS NOT FILED BEFORE U S THE STATEMENT WHICH WAS ALLEGEDLY RECORDED DURING THE COURSE OF T HE SURVEY WHEREIN THE ASSESSEE MADE DISCLOSURE OF UNDISCLOSED INCOME. FURTHER, IT IS ALSO OBSERVED THAT THE REVENUE HAS BROUGHT NO MATERIAL BEFORE US TO SHOW THAT THE ADDITIONAL INCOME OF RS.40 LACS DI SCLOSED BY THE ASSESSEE IN THE RETURN COULD NOT COVER THE ADVANCE OF RS.15.91 LACS IN QUESTION. THE COPY OF AS-1WAS ALSO NOT PRODUCED BE FORE US BY EITHER OF THE PARTIES. MOREOVER, THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) HAS HELD THAT RS15.91 LACS IN QUESTION WAS COVERED BY THE DISCLOSURE OF RS.40 LACS MADE BY THE ASSESSEE I N THE NAME OF SHRI BHAGIRATHSINGH. HOWEVER, WE FIND THAT OUT OF RS.40 LACS DISCLOSED IN THE NAME OF SHRI BHAGIRATHSINGH RS.37.37 LACS RELAT ES TO THE A.Y. 2005-06 AND ONLY RS.2.63 LACS RELATES TO THE YEAR U NDER CONSIDERATION. THUS, IT IS OBVIOUS THAT AMOUNT OF RS.15.91 LACS BE ING MORE THAN RS.2.63 LACS AND THE SAME CANNOT BE HELD AS COVERED BY THE SAID AMOUNT AND THEREFORE, THE FINDING OF THE CIT(A) CA NNOT BE UPHELD. THE ORDER OF ASSESSMENT IS SILENT ABOUT THE NATURE OF TRANSACTION HELD WITH ASSOCIATED CORPORATION., BHARAT CONSTRUCTION, VIPUL AND ASHWIN GAJERA, TOYATO PLANT, LAXMI CONSTRUCTION, J .K. CONSTRUCTION, KAMLESH NATVARLAL AND SURESH M. PARMA R IN RESPECT OF WHICH ACCORDING TO THE LEARNED ASSESSING OFFICER TH E ASSESSEE HAS DISCLOSED INCOME OF RS.37.37 LACS AND THE LEARNED ASSESSING OFFICER HAS BROUGHT NO MATERIAL ON RECORD TO SHOW THAT THES E AMOUNTS WERE UTILISED IN SUCH A MANNER BY THE ASSESSEE THAT THE SAME COULD NOT HAVE - 10 - BEEN UTILIZED FOR GIVING ADVANCE IN QUESTION. THERE FORE, THE FINDING OF THE LEARNED ASSESSING OFFICER ALSO CANNOT BE UPHELD . IN ABSENCE OF FULL DETAILS FILED BEFORE US BY EITHER OF THE PARTI ES WE ARE ALSO NOT IN A POSITION TO ADJUDICATE THE ISSUE COMPLETELY. IN THE CIRCUMSTANCES, IN OUR CONSIDERED OPINION IT SHALL BE IN THE INTEREST OF JUSTICE TO RESTORE THIS ISSUE BACK TO THE FILE OF THE LEARNED ASSESSIN G OFFICER FOR PROPER VERIFICATION IN LIGHT OF THE OBSERVATIONS HEREINABO VE AND THEREFORE TO RE-ADJUDICATE THE ISSUE AS PER LAW BY PASSING A SPE AKING ORDER. WE ORDER ACCORDINGLY. THE LEARNED ASSESSING OFFICER I S FURTHER DIRECTED TO ALLOW SUFFICIENT OPPORTUNITY OF HEARING TO THE A SSESSEE BEFORE RE- ADJUDICATING THE ISSUE. WE THEREFORE, ALLOW THIS GR OUND OF APPEAL OF THE REVENUE FOR STATISTICAL PURPOSES. 15. GROUND NO.2 OF THE APPEAL READS AS UNDER: 2. THE LEARNED C.I.T.(A) ERRED IN LAW AND ON THE FA CTS OF THE CASE IN DIRECTING THE ASSESSING OFFICER TO DELE TE THE ADDITION OF RS.15,68,700/- MADE ON ACCOUNT OF DIFFERENCE IN CASH BALANCE AS PER REGULAR CASH BOOK AND CASH BALANCE AS PER CASH FLOW. 16. THE BRIEF FACTS ARE THAT THE LEARNED ASSESSING OFFICER OBSERVED THAT ASSESSEE FILED CASH POSITION SHEET DU RING THE ASSESSMENT PROCEEDINGS VIDE LETTER DATED 29-11-2006, 30-11-06 AND 18-12-2006. ALL THE THREE CASH POSITION SHEETS SHOWED DIFFERENC E. THE LEARNED ASSESSING OFFICER ISSUED SHOW CAUSE NOTICE ON12-12- 2006 THE ASSESSEE FILED REVISED CLOSING BALANCE SHOWING DIFF ERENCE OF RS.7,03,147/-. AS PER THE CASH BOOK OF THE ASSESSEE SUBMITTED BEFORE THE LEARNED ASSESSING OFFICER THE CASH BALANCE WAS RS.55,52,183/-. THE LEARNED ASSESSING OFFICER TABULATED THE CASH BA LANCE AS PER CASH BOOK AND AS PER THE CASH FLOW STATEMENT AS UNDER :- - 11 - PARTICULARS. GUJARAT RAJASTHAN CASH BALANCE AS ON 31-03- 2004. 8,65,59,687 2,44,92,224 OPENING BALANCE 48,73,987 0 TOTAL 9,14,33,674 2,44,92,224 LESS: EXPENSES. 8,59,81,491 2,44,92,224 TOTAL 5,52,52,183 0 CASH BALANCE SHOWN AS PER ASSESSEES CASH FLOW STATEMENT. 39,83,483 0 DIFFERENCE. 15,68,700 NIL 17. FURTHER, ON THE AFORESAID ISSUE THE APPELLANT V IDE LETTER DATED 18-12-2006 STATED THAT THERE IS NO DIFFERENCE IN CA SH BALANCE, CASH BALANCE AS PER REGULAR BOOKS OF ACCOUNTS IS OF RS.4 6,86,630/-,WHEREAS NOW REVISED CASH BALANCE IS OF RS.39,83,483/- AND THE DIFFERENCE OF RS.7,03,147/- IS LYING WITH SUBCONTRACTORS AS IMPRE ST, SHRI BHAGIRATHSINGH AT GATODA SITE, SHRI GULABSINGH RATH ORE AT CONSTRUCTION SITE AND RS.27,712/- IS RECOVERABLE FR OM SHRI GULABSINGH RATHORE. THUS, THE CASH BALANCE SO LYING IS PART OF ACCOUNTED CASH AND IS FOR THE PURPOSE OF BUSINESS OR GIVEN TO EMPLOYEE S. 18. IN THE ASSESSMENT ORDER THE ASSESSING OFFICER I N THE MONTH OF FEBRUARY, 2004 IN THE THIRD COLUMN OF EXPENSES AN A MOUNT OF RS.74,33,694/- HAS TAKEN, WHEREAS AS PER COMPUTERS TALLY PROGRAMME PRINT OUT THE ACTUAL AMOUNT IS OF RS. 82,99,243/-,D UE TO THIS THE DIFFERENCE IS INCREASED BY RS.8,65,549/-,IF THE SAM E IS REDUCED FROM DIFFERENCE OF RS.15,68,700/-, THE FINAL DIFFERENCE COMES TO RS.7,03,147/-.HENCE, THE DIFFERENCE IS ALREADY EXPL AINED BY THE APPELLANT. - 12 - 19. THE CASH BALANCE IS MAINLY ON ACCOUNT OF IMPRES T GIVEN TO SUBCONTRACTORS OF RS.3,68,000/-, IMPREST LYING WITH CASHIER SHRI BHAGIRATHGSINGH SHEKHAVAT RS.2,63,000/-, PERSONAL EXPENSES RECOVERABLE FROM SHRI GULABSINGH RATHORE OF RS.27,7 12/- AND IMPREST LYING WITH SHRI GULABSINGH RATHORE. THUS, THE AMOUN T OF RS.7,03,147/- IS PART OF THE EXPLAINED/ACCOUNTED CA SH BALANCE OF RS.46,86,630/- WHICH IS CLEAR FROM THE ASSESSMENT ORDER ALSO. 20. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPOR TED THE ORDER OF THE ASSESSING OFFICER AND THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSESSEE SUPPORTED THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). 21. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE THE LEARNE D ASSESSING OFFICER OBSERVED THAT THE CASH BALANCE SHOWN BY THE ASSESSE E AS PER THE BOOKS OF ACCOUNT AS ON 31-03-2004 WAS RS.39,83,483/ - AND THE CASH BALANCE ARRIVED AT BY THE LEARNED ASSESSING OFFICER FROM THE CASH FLOW STATEMENT PREPARED BY HIM WAS RS.55,52,183/-. THE DIFFERENCE OF RS.15,68,700/- WAS TREATED BY THE LEARNED ASSESS ING OFFICER AS THE UNDISCLOSED INCOME OF THE ASSESSEE AND ADDED TO THE INCOME OF THE ASSESSEE. 22. IN APPEAL THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) DELETED THE ABOVE ADDITION FOR THE REASONS GIVEN A BOVE IN THIS ORDER. 23. WE FIND THAT THE LEARNED ASSESSING OFFICER HAS WORKED OUT THE CASH BALANCE AT RS.55,52,183/- AVAILABLE WITH THE A SSESSEE ON 31-03- - 13 - 2004 AS PER THE DISCLOSED SOURCES OF THE ASSESSEE W HICH IS MORE THAN THE CASH DISCLOSED AS PER THE REGULAR BOOKS OF ACCO UNTS OF THE ASSESSEE. IN OTHER WORDS, THE FINDING OF THE LEARNE D ASSESSING OFFICER IS THAT AS PER THE DISCLOSED SOURCES OF INCOME THE ASSESSEE SHOULD HAVE POSSESSED MORE CASH THAN THE CASH DISCLOSED BY THE ASSESSEE. IN OUR VIEW THE ABOVE FINDING DOES NOT GIVE RISE TO AN Y REASON FOR MAKING ADDITION TO THE DISCLOSED INCOME OF THE ASSE SSEE. THE FINDING OF THE LEARNED ASSESSING OFFICER IS NOT TO THE EFFE CT THAT ANY ASSET WAS FOUND POSSESSED BY THE ASSESSEE SOURCE OF WHICH COULD NOT BE EXPLAINED BY THE ASSESSEE WHICH COULD HAVE GIVEN TH E LEARNED ASSESSING OFFICER A BASIS FOR MAKING ADDITION TO TH E INCOME OF THE ASSESSEE. ON THE CONTRARY TO THIS ACCORDING TO THE LEARNED ASSESSING OFFICER THE SOURCES DISCLOSED BY THE ASSESSEE IS MO RE THAN THE ASSET CLAIMED TO HAVE BEEN POSSESSED BY THE ASSESSEE. THI S CONVERSE SITUATION DOES NOT EMPOWER THE LEARNED ASSESSING OF FICER TO MAKE ADDITION OF EVEN A SINGLE RUPEE TO THE DISCLOSED IN COME OF THE ASSESSEE. FOR THE ABOVE REASON, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) IN DELETING THE ADDITION OF RS.15,68,700/-. THEREFORE, THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 24. THE GROUND NO.3 READS AS UNDER :- 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERR ED IN LAW AND ON FACTS OF THE CASE IN DIRECTING TO DEL ETE THE ADDITION OFRS.20,89,516/- MADE BY THE A.O. ON ACCOU NT OF CASH PAYMENTS MADE TO SUB-CONTRACTORS NOT PRODUC ED FOR VERIFICATION. - 14 - 25. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS DECIDED THE ISSUE BY OBSERVING AS UNDER :- 7.4. I HAVE CAREFULLY CONSIDERED THE ISSUE. THE A. O. HAS ADDED THIS AMOUNT AS THE ASSESSEE COULD NOT PRODUCE THE SUBCONTRACTORS TO WHOM CASH PAYMENTS OF RS. 20,89, 516/- WERE MADE. THE APPELLANT STATED THAT THE CASH PAYME NT TO SUBCONTRACTORS OF RS.20.89 LACS WERE WITHDRAWN BY T HE COMPANY ITSELF AND THE SAID CASH WAS USED FOR IMPRE ST PAYMENTS TO SUBCONTRACTORS AS PART OFRS.77.86 LACS, WHICH IS DISCLOSED BY THE APPELLANT-COMPANY AND OFFERED IN T HE RETURNED FILED. IT IS CLAIMED THAT THIS AMOUNT IS ONE OF THE SOURCES FOR MAKING IMPREST PAYMENT TO SUBCONTRACTORS AND AS THE IMPREST PAYMENTS TO CONTRACTORS IS OFFERED AT THE TIME OF S URVEY, THE SOURCE OF THE SAME CANNOT BE TAXED I.E. AS PER PRIN CIPLE OF INFLOW VS. OUTFLOW, ONLY ONE SIDE IS TO BE TAXED I. E. EITHER INCOME OR ITS APPLICATION. AS THE APPELLANT-COMPANY HAS OFFERED THE APPLICATION I.E. IMPREST PAYMENTS TO SU BCONTRACTORS, THE ADDITION OF CASH WITHDRAWN FROM REGULAR BOOKS O F RS.20.89 LACS AMOUNTS TO DOUBLE TAXATION AND IT WAS REQUESTE D THAT SET OFF AGAINST THE DISCLOSURE OF RS.77.86 LACS MAY BE GIVEN BY TREATING THE SAME AS ITS INCOME. I AM INCLINED TO A GREE WITH THE CLAIM OF THE APPELLANT THAT THE CASH OF RS. 20,89,5 16/- WAS WITHDRAWN/SHOWN AS PAYMENTS TO SOME SUBCONTRACTORS AND THE SAID CASH WAS USED FOR MAKING IMPREST PAYMENTS TO SUBCONTRACTORS, WHICH IS OFFERED BY THE APPELLANT-C OMPANY AT THE TIME OF SURVEY. AS THIS AMOUNT IS APPLIED TOWAR DS UNACCOUNTED PAYMENTS AND THE SAME IS OFFERED TO TAX , THERE CANNOT BE ADDITION OF SOURCE OF PAYMENTS AS IT AMOU NTS TO DOUBLE TAXATION. AS PER THE THEORY OF INFLOW AND OU TFLOW ONLY ONE CAN BE TAXED. AS THE APPELLANT-COMPANY HAS OFFE RED THE APPLICATION OF CASH WITHDRAWN FROM SUBCONTRACTORS ACCOUNTS AND PAID TAXES THEREON, THE CASH WITHDRAWN FROM SUBCONTRACTORS ACCOUNT CANNOT BE TAXED AGAIN. THER EFORE, THIS ADDITION OF RS.20,89,516/- IS DELETED ON ACCOUNT OF SET OFF AVAILABLE TO THE ASSESSEE. 26. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORT ED THE ORDER OF THE ASSESSING OFFICER AND THE LEARNED AUTHORISED REPRESENTATIVE - 15 - OF THE ASSESSEE SUPPORTED THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). 27. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE, THE LEARN ED ASSESSING OFFICER MADE ADDITION OF RS.20,89,156/- CLAIMED BY THE ASS ESSEE TO HAVE BEEN PAID TO SUBCONTRACTORS IN CASH AS THE ASSESSE E FAILED TO PRODUCE THE SUBCONTRACTORS BEFORE HIM OR FILE CONFIRMATION OR DETAILS OF PAYMENTS. THE LEARNED ASSESSING OFFICER THEREFORE, TREATED THE CASH PAYMENT OF RS. 20,89,516/- AS NON GENUINE EXPENSES AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. THE ASSESSEE BE FORE THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ADMITTED THAT WHEN SAID AMOUNT OF CASH PAYMENT TO SUBCONTRACTOR IS TREATED AS NON-PAYMENT TO SUBCONTRACTORS THEN THIS MONEY BECOMES AVAILABLE WITH THE ASSESSEE AS SOURCE OF MAKING IMPREST PAYMENT ON ACC OUNT OF WHICH THE ASSESSEE HAS DISCLOSED ADDITIONAL INCOME OF RS. 40 LACS DURING THE YEAR. THE LEARNED COMMISSIONER OF INCOME TAX (APPE ALS) AGREED WITH THE ABOVE AND HELD THAT AS THIS DISALLOWANCE O F RS. 20,89,516/- EXPLAINED SOURCE OF UNDISCLOSED PAYMENT TO THE ABOV E EXTENT AND THEREFORE, BOTH ADDITION OF SOURCE AS WELL AS UTILI SATION CANNOT BE MADE. THE ORDER OF THE LEARNED COMMISSIONER OF INCO ME TAX (APPEALS) IS TO THE EFFECT THAT WHEN ADDITION OF RS . 20,89,516/- IS SUSTAINED THEN ADDITION ON ACCOUNT OF SOURCE OF INV ESTMENT OF RS.40 LACS SHOULD HAVE BEEN REDUCED BY THIS AMOUNT. ACCO RDING TO THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) ADDITIO N OF RS.40 LACS AND ADDITION OF RS.20,89,516/- TANTAMOUNT TO DOUBLE ADDITION TO THE EXTENT OF RS.20,89,516/-. IN THIS VIEW OF THE MATTER, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ALLOWED THE SE T OFF OF THIS - 16 - DISALLOWANCE OF EXPENSES AGAINST THE SOURCE OF UNDI SCLOSED INVESTMENT OF RS.40 LACS AND THEREFORE, DELETED THE ADDITION OF RS.20,89,516/- AS DISCLOSURE OF RS.40 LACS WAS ACC EPTED IN FULL. THE LEARNED DEPARTMENTAL REPRESENTATIVE COULD NOT POINT OUT ANY ERROR IN THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). NO MATERIAL WAS BROUGHT BEFORE US BY THE REVENUE TO SH OW THAT WHY THE ABOVE AMOUNT OF RS.20,89,516/- COULD NOT BE TREATED AS SOURCE OF UNDISCLOSED INVESTMENT OF RS.40 LACS IN RESPECT OF WHICH ADDITIONAL INCOME OF RS.40 LACS WAS ALREADY ASSESSED TO TAX. I N ABSENCE OF ANY SUCH MATERIAL WE DO NOT FIND ANY INFIRMITY IN THE O RDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). IT IS CONFIRM ED AND THE GROUND OF THE REVENUE IS DISMISSED. 28. THE GROUND NO.4 READS AS UNDER :- 4. THE LD. C.I.T.(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECTING THE ASSESSING OFFICER TO DELETE T HE ADDITION OF RS.50,000/- MADE ON ACCOUNT OF UNRECORD ED JOB WORK EXPENSES PAID TO M/S. RANJIT QUARRY WORKS. 29. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME T AX (APPEALS) HAS OBSERVED AS UNDER :- I HAVE CAREFULLY CONSIDERED THE ISSUE. THE A.O. HA S PRESUMED THAT THE APPELLANT COMPANY HAS PAID JOB CHARGES FOR LABOUR WORK AT RS.50,000/- FOR JOB WORK OF 1000 TON RUBLES . THE APPELLANT STATED THAT M/S. RANJIT QUARRY WORKS IS S UPPLYING MOST OF ITS PRODUCTION TO THE APPELLANT COMPANY AND ITS SUBCONTRACTORS AND THIS PARTICULAR JOB WORK OF CRUS ING RUBLES WAS DONE FREE OF CHARGE TO KEEP GOOD BUSINESS RELAT ION AND NEITHER ANY INVOICE WAS RAISED NOR ANY PAYMENT WAS MADE. IN THE CASE OF M/S. RANJIT QUARRY WORKS IN APPEAL NO.C IT(A)- IX/DCIT CIRCLE/HMT/83/06-07 DATED 26-3-2007, REVERS E ADDITION OF JOB WORK INCOME WAS DELETED, CONSIDERIN G THE FACT - 17 - THAT THE JOB WORK WAS DONE ON GOODWILL BASIS, FREE OF CHARGE AND NO INVOICES WAS RAISED AND NO PAYMENT WAS RECEI VED. THEREFORE, THIS ADDITION OF RS.50,000/- IS ALSO DEL ETED AS THERE IS NOTHING TO SHOW THAT ANY SUCH PAYMENT WAS MADE B Y THE ASSESSEE. 30. AT THE TIME OF THE HEARING THE LEARNED DEPARTM ENTAL REPRESENTATIVE SUBMITTED THAT HE IS NOT PRESSING TH IS GROUND OF APPEAL. THEREFORE, THE SAME IS DISMISSED AS NOT PRE SSED. 31. THE GROUND NO.5 READS AS UNDER :- 5. THE LD. C.I.T(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECTING THE ASSESSING OFFICER TO DELETE T HE ADDITION OF RS.10,00,000/- MADE ON ACCOUNT OF PEAK INVESTMENT/INCOME IN THE BENAMI BANK ACCOUNT NO.541 HELD WITH ORIENTAL BANK OF COMMERCE. 32. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME T AX (APPEALS) OBSERVED AS UNDER :- I HAVE CAREFULLY CONSIDERED THE ISSUE. THE A.O. FO UND THAT A BANK ACCOUNT IN THE NAME OF LALITSINGH J.RATHOD WIT H ORIENTAL BANK OF COMMERCE WAS MAINTAINED. IT HAS BEEN ACCEPT ED BY THE DEPARTMENT THAT THE PETROL PUMP IS ACTUALLY OWN ED BY THE ASSESSEE COMPANY. THEREFORE, WHAT WAS TO BE ACTUALL Y SEEN IS WHETHER INCOME OF THE SAID PETROL PUMP HAS BEEN TAK EN INTO ACCOUNT BY THE ASSESSEE OR NOT. THE A.O. HAS MADE A DDITION OF RS.10,00,000/- I.E. THE AMOUNT, WHICH WAS TRANSFERR ED FROM ORIENTAL BANK OF COMMERCE TO THE APPELLANT-COMPANY. IN REMAND REPORT A.O. CONSIDERING THE APPELLATE ORDER IN THE CASE OF N.G. PROJECTS FOR A.Y. 2003-04, HAS RECOMMENDED AN ADDITION OF NET PROFIT OF RS.1,21,813/-. IT IS FURT HER POINTED OUT BY THE A.O. THAT DURING THE COURSE OF SURVEY UNDER SECTION 133A SHRI HARENDRASINGH DIRECTOR OF THE COMPANY HAD OFFERED ADDITIONAL INCOME OF RS.9.10 LACS OF THE BENAMI HPC L PETROL - 18 - PUMP. THE APPELLANT CLAIMED THAT IN THE CASE OF M/ S. N. G. PROJECTS IN THE APPEAL OF A.Y. 2003-04 IN THE APPEA L NO.CIT(A)-IX/ACIT/HMT/25/06-07 DATED 09-10-2006, TH E ADDITION OF PEAK AMOUNT WAS DELETED, CONSIDERING TH E SAME ORDER AND THE PEAK ENTRY IN THE BANK ACCOUNT IS FUL LY EXPLAINED, ADDITION OF RS.10,00,000/- MADE ON ACCOUNT OF PEAK IN HPCL BANK ACCOUNT IS DELETED. 33. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AT THE TIME OF HEARING THE LEA RNED DEPARTMENTAL REPRESENTATIVE VERY FAIRLY CONCEDED THAT THE ISSUE IS COVERED AGAINST THE REVENUE AND IN FAVOUR OF THE ASSESSEE BY THE CO NSOLIDATED ORDER OF THE TRIBUNAL PASSED ON 8-1-2010 IN THE CASE OF C.I. T. VS. M/S. N.G.PROJECTS AND DY.C,I.T. VS.HARENDRASINGH NARAY ANSINGH IN ITA NOS.316/AHD07 AND ITA NO.318/AHD/07 IN THE ASSESSM ENTYEAR 2003-04. WE FIND THAT THE TRIBUNAL IN THE SAID ORDE R HELD AS UNDER :- 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND MA TERIAL AVAILABLE ON RECORD. IT IS ADMITTED FACT THAT PETRO L PUMP IS RUN BY LALITSINGH J. RATHORE BENAMIDAR ON BEHALF OF THE ASSESSEE M/S. N. G. PROJECTS. ALL THE DETAILS OF THE PETROL PUMP ARE REFLECTED IN THE BANK ACCOUNT WITH OBC. IT IS ALSO ADMITTED FACT THAT INCOME FROM THE HPCL PETROL PUMP WAS NOT DISCL OSED TO THE REVENUE AUTHORITIES. THE ASSESSEE HAS SHOWN INC OME FROM THE PETROL PUMP AT RS.11,682 AND THE LD. LEARNED COMMISSIONER OF INCOME TAX(APPEALS) ESTIMATED THE S AME INCOME AT RS.20,000/-.NEITHER THE REVENUE NOR THE A SSESSEE IS IN APPEAL CHALLENGING THE AFORESAID FINDINGS OF THE LD.CIT(A) MAKING THE ADDITION ON ACCOUNT OF INCOME FROM THE P ETROL PUMP IN THE HANDS OF THE ASSESSEE. NOW THE QUESTION IS LEFT FOR CONSIDERATION WHETHER DEPOSITS IN THE BANK ACCOUNT NO.541 WITH OBC WAS UNEXPLAINED PEAK DEPOSIT. THE MATERIAL ON R ECORD AS NOTED ABOVE CLEARLY SUGGEST THAT M/S. PVC WAS PURCH ASING DIESEL FROM HPCL PETROL PUMP BELONGING TO THE ASSES SEE M/S. N.G. PROJECTS. THIS PARTY WAS SUPPLYING MATERIAL TO THE ASSESSEE FOR WHICH SEPARATE PAYMENTS ARE MADE. IT I S PROVED ON RECORD THAT M/S. PVC MADE THE PAYMENT OF RS.13,25,1 44/- IN THE ACCOUNT OF HPCL PETROL PUMP THROUGH CHEQUE ON - 19 - 15.3.2003 FOR PURCHASE OF DIESEL. THUS THE FINDINGS OF THE LD. LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ARE SU PPORTED BY THE ENTRIES CONTAINED IN THE BANK ACCOUNT NO.541 WITH OBC (PAPER-BOOK-73), BOOK ENTRY IN ACCOUNT (PAPER-BOOK- 82), BANK CERTIFICATE OF OBC (PAPER-BOOK 87) AND LE DGER ACCOUNT OF M/S. PVC PURCHASING DIESEL FROM HPCL PET ROL PUMP (PAPER-BOOK 105). THE ABOVE FACTS AND MATERIAL/EVIDENCES ON RECORD CLEARLY PROVE THAT HPC L PETROL PUMPS BANK ACCOUNT WITH OBC RECEIVED TRANSFER ENTR Y THROUGH BANKING CHANNEL OF RS.13,25,144/- WHICH WAS PAID BY M/S. PVC. ALL THESE TRANSACTIONS ARE DULY RECORDED IN THE RECORDS. THEREFORE, SUCH PEAK ENTRY CANNOT BE TREAT ED AS UNEXPLAINED DEPOSIT IN THE BANK ACCOUNT OF HPCL PET ROL PUMP. SINCE THE PEAK DEPOSIT ENTRY IS EXPLAINED THROUGH T HE EVIDENCES AND MATERIAL ON RECORD, THEREFORE, WE DO NOT FIND A NY JUSTIFICATION TO INTERFERE WITH THE FINDINGS OF THE LD.CIT(A).HOWEVER, WE MAY NOTE THAT IT IS ADMITTED FACT THAT THE BUSINESS OF HPCL PETROL PUMP WAS NEVER SHOWN BY THE ASSESSEE M/S. N.G. PROJECTS BEFORE THE AUTHORITIES BELOW. HOWEVER, LD.CIT (A) HAS TAKEN CARE OF IN MAKING THE ADDITION ON ACCOUNT OF INCOME EARNED BY THE AFORESAID PETROL PUMP, LD. CIT(A) DID NOT EXAMINE THE ISSUE OF THE INVESTMENT MADE BY THE ASSESSEE IN THE AFORESAID PETROL PUMP AT ANY P OINT OF TIME. SINCE THE INVESTMENT IN THE PETROL PUMP OWNED BY TH E ASSESSEES BENAMIDAR IN THE NAME OF LALITSINGH J.R ATHORE IS NOT EXAMINED BY THE AUTHORITIES BELOW AT ANY TIME, THEREFORE, WE DIRECT THE LEARNED ASSESSING OFFICER TO EXAMINE THE QUESTION OF INVESTMENT BY THE ASSESSEE IN THE AFORE SAID PETROL PUMP IN ACCORDANCE WITH LAW IF SO DEEMED FIT AND PR OPER. WITH THESE OBSERVATIONS, THE DEPARTMENTAL APPEAL STANDS DISMISSED ON GROUND NO.2 IN THE CASE OF M/S. N.G. PROJECTS. S INCE THE SUBSTANTIVE ADDITION IS DELETED BY LD.CIT(A) AND CO NFIRMED BY US, THEREFORE, PROTECTIVE ASSESSMENT WOULD NOT STAN D. ACCORDINGLY, THE SOLITARY GROUND IN THE CASE OF HAR ENDRA SINGH N. RATHOD IS ALSO DISMISSED. AS A RESULT, DEPARTMEN TAL APPEALS IN BOTH THE CASES ON THIS ISSUE ARE DISMISSED. RESPECTFULLY FOLLOWING THE ABOVE QUOTED ORDER OF TH E TRIBUNAL, WE DISMISS THIS GROUND OF APPEAL OF THE REVENUE. - 20 - 34. THE GROUND NO.6 READS AS UNDER:- 6. THE LD. C.I.T.(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN LAW AND ON THE FACTS OF THE CASE IN HOLDING THAT THE ADDITION TOWARDS INCOME OF HPCL PUMP OF RS. 9.1 0 LACS EARNED WHICH WAS USED FOR MAKING IMP REST PAYMENTS TO SUBCONTRACTORS MERGED WITH THE OVERDRAF T DISCLOSURE OF RS.77.86 LACS AND NO SEPARATE ADDITIO N WAS REQUIRED. 35. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS DECIDED THE ISSUE BY OBSERVING AS UNDER:- HOWEVER, CONSIDERING THE DISCLOSURE OF INCOME OF H PCL PUMP OF RS.9.10 LACS BY APPELLANT-COMPANY, THE SAME HAS TO BE TAXED IN THIS YEAR AS THE PETROL PUMP WAS STARTE D FROM DECEMBER, 2002 AND WAS SURRENDERED IN THE MONTH OF MARCH, 2004 I.E. IN A.Y. 2004-05.THE APPELLANT-COMPANY HAS STATED THAT THE INCOME OF HPCL PUMP OF RS.9.10 LACS INCLUD ES CURRENT YEARS INCOME OF RS.1,21,813/-, THEREFORE, N O SEPARATE ADDITION MAY BE MADE FOR THIS AMOUNT. IT IS FURTHER CLAIMED THAT THE INCOME OF HPCL PUMP OF RS.9.10 LACS WAS US ED FOR IMPREST PAYMENTS TO SUBCONTRACTORS AND AS THE IMPRE ST PAYMENTS TO CONTRACTORS IS OFFERED AT THE TIME OF S URVEY, THE SOURCE OF THE SAME CANNOT BE TAXED, AND IT IS TAXED IT AMOUNTS TO DOUBLE TAXATION. I AM, INCLINED TO AGREE WITH TH E CLAIM OF THE APPELLANT THAT THE INCOME OF HPCL PUMP OF RS.9. 10 LACS EARNED IS UNACCOUNTED AND THE SAID INCOME WAS USED FOR MAKING IMPREST PAYMENTS TO SUBCONTRACTORS, WHICH IS OFFERED BY THE APPELLANT COMPANY AT THE TIME OF SURVEY AND A REVISED RETURN WAS FILED. AS THIS AMOUNT IS APPLIED FOR UNA CCOUNTED PAYMENTS AND THE SAME IS DISCLOSED AS ADDITIONAL IN COME, THIS ADDITION IS MERGED WITH THE OVERALL DISCLOSURE OF R S.77.86 LACS AND NO SEPARATE ADDITION IS REQUIRED AS ITS APPLICA TION IS TAXED. 36. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE THE LEARN ED ASSESSING OFFICER - 21 - MADE ADDITION OF RS.9.10 LACS ON ACCOUNT OF INCOME FROM RUNNING OF PETROL PUMP WHICH WAS A BENAMI BUSINESS OF THE ASSE SSEE. ON APPEAL, LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) DELETED THE ABOVE ADDITION ON THE GROUND THAT THIS INCOME OF RS .9.10 LACS WAS UTILIZED FOR MAKING THE IMPREST PAYMENT AND AS THE RESULTANT ASSET I.E. IMPREST MONEY WAS ASSESSED TO TAX, THE SOURCE OF TH AT ASSET CANNOT AGAIN BE SEPARATELY ASSESSED TO TAX AS THE SAME WIL L TENTAMOUNT TO DOUBLE ASSESSMENT. IN VIEW OF THE ABOVE, THE LEARNE D COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE SEPARATE ADDITI ON OF RS.9.10 LACS. BEFORE US THE LEARNED DEPARTMENTAL REPRESENTA TIVE SUBMITTED THAT THE AMOUNT OF RS.9.10 LACS WAS SEPARATELY SHOW N IN THE BALANCE SHEET OF HPCL PUMP AND THEREFORE, THE SAME COULD NO T HAVE BEEN UTILISED BY THE ASSESSEE FOR PAYMENT TO SUBCONTRACT ORS. WE FIND THAT THE COPY OF BALANCE SHEET OF HPCL PETROL PUMP WAS NOT FILED BEFORE US. THE FINDING OF THE LEARNED COMMISSIONER OF INCO ME TAX (APPEALS) IS THAT THE BUSINESS OF THE PETROL PUMP W AS CLOSED DOWN IN MARCH,2004. NO MATERIAL WAS BROUGHT BEFORE US BY TH E REVENUE TO CONTROVERT THE ABOVE FINDING OF THE CIT(A). NO MATE RIAL WAS ALSO BROUGHT ON RECORD TO SHOW THAT RS. 9.10 LACS OF SAI D PETROL PUMP WAS UTILISED BY THE ASSESSEE IN SUCH A MANNER THAT DUE TO THE SAME, THE SAME COULD NOT HAVE BEEN UTILISED BY THE ASSESSEE I N GIVING IMPREST ADVANCES IN RESPECT OF WHICH THE ASSESSEE HAS DISCL OSED ADDITIONAL INCOME OF RS.40 LACS DURING THE YEAR UNDER CONSIDER ATION. IN ABSENCE OF ANY SUCH MATERIAL BROUGHT BEFORE US WE DO NOT FI ND ANY GOOD REASON TO INTERFERE WITH THE ORDER OF THE LEARNED C OMMISSIONER OF INCOME TAX (APPEALS). THEREFORE, THIS GROUND OF APP EAL OF THE REVENUE IS REJECTED. - 22 - 37. THE GROUND NO.7 READS AS UNDER :- 7. THE LD. COMMISSIONER OF INCOME TAX (A) ERRED IN LAW AND ON THE FACTS IN DIRECTING THE ASSESSING OFFICER TO DELETE THE DISALLOWANCE MADE AND ALLOW THE ASSESSEE S CLAIM OF DIESEL OIL EXPENSES OF RS.35,89,388/- AS BUSINESS EXPENDITURE, IGNORING THE FACT THAT THE AS SESSEE HAD NEITHER CLAIMED THE SAID EXPENDITURE EITHER IN ORIGINAL RETURN OF INCOME NOR IN THE REVISED RETURN OF INCOME. UNDER THE SIMILAR CIRCUMSTANCES, IN THE CAS E OF INFINIUM COMMUNICATION PVT. LTD. VS. I.T.O. FOR ASSESSMENT YEARS 2000-01 AND 2001-02 IN I.T.A. NOS. 3489 AND 3490/AHD/2004, THE HON'BLE I.T.A.T., AHMEDABAD, VIDE THEIR ORDER DATED 3-11-2006 UPHELD THE FINDINGS OF THE CIT (A) THAT APPEAL IS NOT MAINTAIN ABLE WHERE SUBSEQUENT SURVEY ACTION, THE ASSESSEE HAS FI LED REVISED RETURN OF INCOME. THE ASSESSEES CLAIM OF EXPENSES ALSO NOT ALLOWABLE AS HELD IN THE HON'BLE SUPREME COURT DECISION IN THE CASE OF GOETZE (INDIA ) LTD., VS. CIT (2006) 204 ITR-33 (SC). 38. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS OBSERVED AS UNDER:- I HAVE CAREFULLY CONSIDERED THE ISSUE. IN THIS CAS E A REVISED RETURN WAS FILED OFFERING ADDITIONAL INCOME AND AFT ER THAT A CLAIM OF THESE EXPENSES WERE ALREADY MADE BEFORE TH E LEARNED ASSESSING OFFICER. THIS CLAIM HAS BEEN REJECTED ON THE GROUND THAT THE ASSESSEE HAD NOT DEBITED EXPENSES IN THE R EGULAR BOOKS OF ACCOUNTS. THE APPELLANT-COMPANY CONTENDED THAT T HE DIESEL- PETROL AND OIL ARE TAKEN FROM HPCL PUMP, KNOWN AS N .G. PUMP, WHICH IS A BENAMI CONCERN OF APPELLANT-COMPAN Y. THE BILLS ARE RAISED BY HPCL PUMP IN THE NAME OF COMPAN Y, ITS SUBCONTRACTOR OR IN THE NAME OF SITE WHERE THE WORK IS CARRIED OUT. THE PAYMENTS OF SUCH PURCHASES OF DIESEL OIL E XPENSES ARE MADE BY M/S. N.G. PROJECTS LTD. BY CHEQUE FROM REGU LAR BOOKS AND AN AMOUNT OF RS.78.74 LACS IS LYING WITH HPCL P UMP. THE DIESEL OIL EXPENSES ARE DEDUCTED FROM THE WORK BILL S OF SUBCONTRACTORS NAMELY DHRUVRAJ CONSTRUCTION, MAHEND RASINGH M. RATHOD AND BHARAT CONSTRUCTION, BUT THE EXPENSES ENTRY WAS NOT PRESSED BY THE ACCOUNTANT. SIMILARLY, DIESE L OIL EXPENSES RELATED TO VARIOUS SITES, OWN DUMPERS, TRU CKS AND - 23 - VEHICLES WERE NOT RECORDED IN THE BOOKS OF M/S. N.G . PROJECTS LTD BY MISTAKE. THE SUBMISSION ALONG WITH EVIDENCES WAS FORWARDED TO A.O. FOR HIS COMMENTS AS THE HPCL PUMP . THE A.O. IN HIS REMAND REPORT HAS GIVEN GENERAL COMMENT S BUT WAS NOT ABLE TO STATE ANY REASON OR EVIDENCE AS TO WHY SUCH CLAIM SHOULD NOT BE ENTERTAINED, WHICH IS SUPPORTED BY EV IDENCES AND WHEN PAYMENT OF ENTIRE EXPENSES IS MADE FROM REGULA R BOOKS OF ACCOUNTS I.E. EXPLAINED SOURCES AND AN AMOUNT OF RS.78.74 LACS IS STILL SHOWN AS RECOVERABLE FROM HPCL PUMP, WHICH IS MUCH MORE THAN THE DIESEL OIL EXPENSES OF RS.35.89 LACS. THE APPELLANT-COMPANY ALSO FURNISHED THAT THESE EXPENSE S ARE INCURRED FOR THE PURPOSE OF ITS CONSTRUCTION ACTIVI TIES AND THE CLAIM WAS LEFT OUT MERELY BY THE MISTAKE OF ACCOUNT ANT, WHO HAS NOT PASSED THE ENTRIES IN THE BOOKS, EVEN THOUG H THE EVIDENCES WERE AVAILABLE. WITH REGARD TO, CLAIM OF EXPENSES FOR WHICH NO ENTRIES ARE PASSED IN THE BOOKS THE ASSESS EE COMPANY RELIED ON THE DECISION OF THE APEX COURT IN THE CAS E OF KEDARNATH JUTE MFG. CO. LTD. VS. CIT (82ITR-363) AN D DECISION OF GUJARAT HIGH COURT IN THE CASE OF S.R. KOSHTI 276 ITR PAGE-65. I AM INCLINED TO AGREE WITH THE CLAIM OF APPELLANT COMPANY ON THE BASIS OF FACTS, EVIDENCES AND LAW TH AT THE EXPENSES ARE INCURRED FOR THE PURPOSE OF BUSINESS, THE APPELLANT-COMPANY IS HAVING AMPLE EVIDENCES OF THE EXPENSES INCURRED AND THE PAYMENT OF EXPENSES ARE ALSO MADE FROM REGULAR BOOKS OF ACCOUNTS, WHICH IS LYING STANDING IN THE NAME OF PARTY AND MERELY AS BOOK ENTRIES WERE NOT PASSED , A GENUINE CLAIM CANNOT BE REJECTED. THEREFORE, THE A.O. IS DI RECTED TO ALLOW THE CLAIM OF DIESEL-OIL EXPENSES OF RS.35,89, 388/- AS BUSINESS EXPENDITURE. 39. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE BRIEF FACTS OF THE CASE AR E THAT THE LEARNED ASSESSING OFFICER OBSERVED THAT THE ASSESSEE CLAIME D RS. 35,89,388/- AS PETROL & DIESEL EXPENSES FOR THE PURPOSE OF BUSI NESS. ACCORDING TO THE LEARNED ASSESSING OFFICER THE AMOUNT WAS NOT DE BITED AS THE EXPENSES IN THE BOOKS OF ACCOUNT AND REJECTED THE C LAIM OF THE ASSESSEE FOR DEDUCTION OF THE SAME. THEREFORE, HE DISALLOWED - 24 - DEDUCTION FOR THE SAME. THE ASSESSEE SUBMITTED BEFO RE THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) THAT DUE TO MI STAKE OF THE ACCOUNTANT THE ENTRY FOR EXPENSES WAS NOT PASSED IN THE BOOKS OF ACCOUNTS ALTHOUGH THE PAYMENTS WERE MADE FOR THE SA ME THROUGH CHEQUES WAS ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS. THE CIT(A) AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE HE LD THAT A REVISED RETURN WAS FILED OFFERING ADDITIONAL INCOME AND AFT ER THAT A CLAIM OF THESE EXPENSES WERE ALREADY MADE BEFORE THE AO THE LEARNED ASSESSING OFFICER REJECTED THE CLAIM OF THE ASSESSE E ON THE GROUND THAT THE ASSESSEE HAD NOT DEBITED EXPENSES IN THE R EGULAR BOOKS OF ACCOUNTS. THE ASSESSEE CONTENDED THAT THE DIESEL PE TROL AND OIL ARE TAKEN FROM HPCL PUMP KNOWN AS N.G. PUMP WHICH IS A BENAMI CONCERN OF THE ASSESSEE. THE BILLS ARE RAISED BY HP CL PUMP IN THE NAME OF THE ASSESSEE, ITS SUBCONTRACTOR OR IN THE N AME OF SITE WHERE THE WORK IS CARRIED OUT. THE PAYMENTS OF SUCH PURCH ASES OF DIESEL OIL EXPENSES ARE MADE BY THE ASSESSEE BY CHEQUE FROM RE GULAR BOOKS AND AN AMOUNT OFRS.78.74 LACS WAS LYING WITH HPCL PUMP. THE DIESEL OIL EXPENSES ARE DEDUCTED FROM THE WORK BILLS OF SU BCONTRACTOR NAMELY DHRUVRAJ CONSTRUCTION, MAHENDRASINGH M RATHO D AND BHARAT CONSTRUCTION BUT THE EXPENSE ENTRY WAS NOT PASSED B Y THE ACCOUNTANT. SIMILARLY, DIESEL OIL EXPENSES RELATING TO VARIOUS SITES OWN DUMPERS, TRUCKS AND VEHICLES WERE NOT RECORDED IN THE BOOKS OF THE ASSESSEE BY MISTAKE. THE SUBMISSIONS AND EVIDENCES WERE FORWARD ED TO THE LEARNED ASSESSING OFFICER FOR HIS REMAND REPORT WHO HAD GIVEN GENERAL COMMENT BUT WAS UNABLE TO STATE ANY REASON OR EVIDENCE FOR NOT ALLOWING SUCH CLAIM OF THE ASSESSEE WHICH IS SU PPORTED BY THE EVIDENCES AND FOR WHICH PAYMENT IS MADE FROM REGULA R BOOKS OF ACCOUNTS I.E. EXPLAINED SOURCES AND AN AMOUNT OF RS .78.74 LACS WAS - 25 - SHOWN AS RECOVERABLE FROM HPCL PUMP WHICH WAS MORE THAN THE DIESEL OIL EXPENSES OF RS.35.89 LACS CLAIMED BY THE ASSESSEE. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) RELIED ON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE O F KEDARNATH JUTE MFG. CO. LTD., VS. CIT 82 ITR 363 AND THE DECISION OF HON'BLE GUJARAT HIGH COURT IN THE CASE OF S.R. KOSHTI 276 I TR 165 WHERE IT WAS HELD THAT ENTRIES IN THE BOOKS OF ACCOUNTS ARE NOT RELEVANT FOR ALLOWING AN EXPENDITURE TO THE ASSESSEE WHICH IS O THERWISE ALLOWABLE TO THE ASSESSEE. THEREFORE, HE ALLOWED THE CLAIM OF THE ASSESSEE FOR DIESEL OIL EXPENSES OF RS.35,89,388/- AS BUSINESS E XPENDITURE. THE LEARNED DEPARTMENTAL REPRESENTATIVE RELIED UPON THE ORDER OF THE LEARNED ASSESSING OFFICER. WE FIND THAT IT IS NOT I N DISPUTE THAT PAYMENT IN RESPECT OF PURCHASE OF DIESEL OIL WAS MA DE BY ACCOUNT PAYEE CHEQUE AND WERE DULY ENTERED IN THE REGULAR B OOKS OF ACCOUNT OF THE ASSESSEE. THE ONLY DISCREPANCY WAS THAT THE ASSESSEE INSTEAD OF DEBITING THE SAME IN THE PROFIT AND LOSS ACCOUNT HA S DEBITED THE SAME IN THE BALANCE SHEET AND HAS SHOWN THE SAME AS RECO VERABLE FROM HPCL PETROL PUMP. THE LEARNED COMMISSIONER OF INCOM E TAX (APPEALS) HAS CATEGORICALLY RECORDED THAT ALL THE E VIDENCES OF PURCHASES OF RS.35,89,388/- WERE FORWARDED TO THE LEARNED ASSESSING OFFICER FOR HIS REMAND REPORT. NO MATERIA L COULD BE BROUGHT ON RECORD BY THE REVENUE TO SHOW THAT ANY P ART OF EXPENSES OF RS.35,89,388/- WERE NOT SUPPORTED BY EVIDENCES O R WERE NOT UTILISED IN THE BUSINESS OF THE ASSESSEE. THE REVEN UE COULD NOT BRING ANY MATERIAL TO SHOW THAT THE DIESEL OIL EXPENSES W HICH WERE REQUIRED FOR THE ASSESSEES BUSINESS WERE ALREADY DEBITED IN THE PROFIT AND LOSS ACCOUNT OF THE ASSESSEE AND WERE ALLOWED AS DEDUCTI ON BY THE LEARNED ASSESSING OFFICER. IN ABSENCE OF ANY SUCH M ATERIAL BROUGHT - 26 - ON RECORD WE DO NOT FIND ANY GOOD REASON TO INTERFE RE WITH THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) . IN OUR CONSIDERED OPINION THE CONTENTION OF THE REVENUE TH AT GENUINE EXPENSE OF THE ASSESSEE CANNOT BE ALLOWED AS A DEDU CTION MERELY ON THE GROUND THAT DUE TO SOME ERROR THE SAID EXPENSE IS DEBITED IN THE BALANCE SHEET IN PLACE OF PROFIT AND LOSS ACCOUNT I S NOT TENABLE IN LAW. WE THEREFORE, DO NOT FIND ANY MERIT IN THIS G ROUND OF APPEAL OF THE REVENUE. THEREFORE, IT IS DISMISSED. 40. THE GROUND NO.8 READS AS UNDER :- 8. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) ERRED IN LAW AND ON THE FACTS OF THE CASE IN ACCEPT ING THE ASSESSEES ADDITIONAL GROUND IN RESPECT OF IMPREST PAYMENT OF RS.37.37 LACS PERTAINING TO ASSESSMENT Y EAR 2005-06, THOUGH THE SAME WAS INCLUDED IN THE DISCLO SURE FOR A.Y. 2004-05 BY WAY OF FILING REVISED RETURN. T HE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN ADJUDICATING THE ASSESSEES GROUND ON THIS POIN T ALSO KEEPING IN VIEW IN THE FACTS IN RESPECT OF GROUND N O.7 ABOVE. 43. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS OBSERVED AS UNDER:- I HAVE CAREFULLY CONSIDERED THE OBSERVATIONS OF T HE A.O IN THE REMAND REPORT, SUBMISSION OF THE APPELLANT COMPANY BEFORE ME AND ARGUMENTS OF THE LD. A.R. THE APPELLA NT COMPANY STATED THAT AT THE TIME OF SURVEY A DISCLOS URE OF RS.82.86 LACS WAS MADE, WHICH INCLUDED DISCLOSURE O N ACCOUNT OF IMPREST PAYMENTS TO SUBCONTRACTORS OF RS.37.86 L ACS, CASH PAYMENTS BY SHRI BHAGIRATHSINGH OF RS.40 LACS AND DISALLOWANCE UNDER SECTION 40A(3) OFRS.5 LACS ON A CCOUNT OF CASH PAYMENTS TO M/S. RANJIT QUARRY WORKS. THROUGH ADDITIONAL GROUND IT IS CLAIMED THAT DISCLOSURE OFR S.40 LACS INCLUDES AN AMOUNT OF RS.37.37 LACS, WHICH IS PERTA INING TO A.Y. 2005-06. IN THIS REGARD IT IS CLAIMED THAT REL IEF OF RS.37.37 LACS MAY BE GIVEN FROM THE INCOME OFFERED AS IT - 27 - PERTAINS TO NEXT ASSESSMENT YEAR. THE A.O. AND ADDL . C.I.T. IN REMAND REPORT HAVE POINTED OUT VARIOUS ISSUES WHICH INCLUDES AN AMOUNT OF RS.20 LACS PAID TO KIRIT CONSTRUCTION CO. ON 10- 05-2003. I HAVE GONE THROUGH THE DETAILS FILED, WHI CH CONTAINS ANNEXURE WISE, PAGE-WISE, DATE WISE REFERENCE FROM IMPOUNDED MATERIAL AND FROM THE PHOTO-COPIES OF IMPOUNDED MAT ERIAL IT IS VERIFIED THAT THE PERIOD OF PAYMENTS BY SHRI BHAGIR ATHSINGH OF RS.37.37 LACS IS PERTAINING TOF.Y.2004-05 I.E. RELE VANT TOA.Y.2005-06. IT IS VERY CLEAR FROM THE FACTS AVAI LABLE ON RECORDS THAT THE AMOUNT IN QUESTION PERTAINS TO SUB SEQUENT PERIOD I.E.A.Y.2005-06.IT IS SETTLED LAW THAT ONLY REAL INCOME PERTAINING TO THE PERIOD UNDER CONSIDERATION CAN BE TAXED. THE APPELLANT-COMPANY MAY HAVE DISCLOSED THIS AMOUNT IN THE RETURN OF INCOME UNDER MISCONCEPTION OR NOT BEING P ROPERLY ADVISED BUT THE A.O. WAS DUTY BOUND TO TAX ONLY IF THIS AMOUNT PERTAINED TO THE YEAR UNDER CONSIDERATION. HOWEVER, I ALSO AGREE WITH THE A.O. THAT AN AMOUNT OF RS.20 LACS PA ID TO KIRIT CONSTRUCTION CO. IS TO BE INCLUDED IN THE CURRENT Y EARS DISCLOSURE FOR WHICH THE LD. A.R. HAS ALSO AGREED. SIMILARLY, I HAVE HELD THAT RS.15.91 LACS DISCUSSED IN PARA NO.5 .4 IS TO BE CONSIDERED AS PART OF INCOME DISCLOSED BY SHRI BHAG IRATHSINGH AND NO SEPARATE ADDITION WAS REQUIRED. THERE ARE S OME OTHER ITEMS ALSO WHICH ARE TO BE CONSIDERED FOR ADDITION. IN VIEW OF THIS POSITION THE A.O.IS DIRECTED TO CONSIDER THESE AS PART OF DISCLOSURE OF RS.40 LACS, THEREFORE, THE A.O. IS DI RECTED TO CONSIDER THE FOLLOWING ITEMS AS INCLUDED IN THE DIS CLOSURE OF RS.40 LACS. SR.NO. NAME 1 CASH PAYMENT BY BHAGIRATHSINGH FOR FINANCIAL YEAR 2003-04 A.Y. 2004-05 PAYMENTS RECORDED TO A.Y.2004- 05 2,63,000 KIRIT CONSTRUCTION CO. 20,00,000 PAYMENTS TO SUBCONTRACTORS AS RECORDED IN ANNEX. AS-1. 15,91,000 MISCELLANEOUS DISCLOSURE. 1,46,000 TOTAL AMOUNT. 40,00,000 - 28 - THUS, EVEN THOUGH THE CLAIM OF THE APPELLANT IS COR RECT BUT THERE WILL BE NO VARIATION TO THE TOTAL INCOME ASSESSED BY THE LEARNED ASSESSING OFFICER ON ACCOUNT OF THIS GROUND IN VIEW OF DIRECT IONS GIVEN ABOVE. 44. AFTER HEARING THE RIVAL SUBMISSIONS AND PERUSIN G THE MATERIAL AVAILABLE ON RECORD, WE FIND THAT THE ASSESSEE HAS DISCLOSED ADDITIONAL INCOME OF RS.40 LACS IN THE REVISED RETURN FILED FO R THE YEAR UNDER CONSIDERATION. THE ASSESSEE TOOK AN ADDITIONAL GROU ND BEFORE THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) AND CON TENDED THERE THAT THE SAID ADDITIONAL INCOME INCLUDES AMOUNT OF RS.37.37 LACS ON ACCOUNT OF IMPREST PAYMENT TO SHRI BHAGIRATHSINGH W HICH RELATES TO THE ASSESSMENT YEAR 2005-06 AND THEREFORE THE SAME SHOULD BE REDUCED FROM THE DISCLOSED INCOME IN THE REVISED RE TURN. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FOR THE REASON S MENTIONED IN THE APPELLATE ORDER DISMISSED THE GROUND OF APPEAL OF THE ASSESSEE EVEN AFTER ADMITTING THAT RS.37.37 LACS RELATES TO THE ASSESSMENT YEAR 2005-06. THUS, THE GROUND OF APPEAL OF THE ASSESSE E WAS DISMISSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) . ON THE ABOVE FACTS, IN OUR CONSIDERED OPINION THE REVENUE COULD NOT HAVE ANY GRIEVANCE FROM THIS DECISION OF THE LEARNED COM MISSIONER OF INCOME TAX (APPEALS). WE FIND THAT IN RESPECT OF D ISCLOSED ADDITIONAL INCOME OF RS.40 LACS IN THE YEAR UNDER C ONSIDERATION, ON ASSESSMENT THE LEARNED ASSESSING OFFICER MADE ONLY A FURTHER ADDITION OF RS.15.91 LACS ON ACCOUNT OF IMPREST PAY MENT TO SUBCONTRACTORS AS PER AS-1 WHICH WAS DISPUTED BY TH E REVENUE AS GROUND NO.1 OF THIS APPEAL. WE HAVE ALREADY ADJUDI CATED THAT GROUND EARLIER IN THIS ORDER. THE LEARNED DEPARTMEN TAL REPRESENTATIVE COULD NOT POINT OUT ANY SPECIFIC PRE JUDICE WHICH WAS CAUSED TO THE REVENUE FOR THE YEAR UNDER CONSIDERAT ION BY THE ORDER - 29 - OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) RELATING TO GROUND UNDER CONSIDERATION. IN THE CIRCUMSTANCES, WE DO NOT FIND ANY MERIT IN THIS GROUND OF APPEAL OF THE REVENUE AND T HE SAME IS DISMISSED. 45. IN THE RESULT, THE APPEAL OF THE REVENUE IS PAR TLY ALLOWED FOR STATISTICAL PURPOSES. ORDER SIGNED, DATED AND PRONOUNCED IN THE COURT ON 16TH DAY OF JULY, 2010. SD/- SD/- (BHAVNESH SAINI) ( N.S. SAINI ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; ON THIS 16TH DAY OF JULY, 2010 PATKI COPY OF THE ORDER FORWARDED TO : 1. THE ASSESSEE. 2. THE DEPARTMENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS)- 5. THE DR, AHMEDABAD BENCH 6. THE GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT.REGISTRAR), ITAT, AHMEDABAD DATE INITIALS 1. DRAFT DICTATED ON 12-7-10 2. DRAFT PLACED BEFORE AUTHORITY 14-7-10 3. DRAFT PROPOSED & PLACED 14-7-10 JM BEFORE THE SECOND MEMBER 4. DRAFT DISCUSSED/APPROVED 15-7-10 JM/ AM BY SECOND MEMBER 5. APPROVED DRAFT COMES TO P.S 16-7-10 6. KEPT FOR PRONOUNCEMENT ON 16-7-10 7. FILE SENT TO THE BENCH CLERK 16-7-10 8. DATE ON WHICH FILE GOES TO THE 9. DATE OF DISPATCH OF ORDER