Dhirubhai Girdharbhai & Sons, Tal.Anand V. The Income tax Officer,Ward-3, Anand

ITA 4463/AHD/2007

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6700 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 26-04-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 19-12-2007
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: H P MEENA
• Assessee Lawyers: J P SHAH
• Keywords: Unexplained investment; Corroborative evidences
• Section: 133A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH AHMEDABAD (BEFORE S/SHRI G. D. AGARWAL, VP AND BHAVNESH SAINI , JM) ITA NO.4463/AHD/2007 A. Y.: 2003-04 M/S. DHIRUBHAI GIRDHARBHAI & SONS, AT. P. O. SARSA, TALUKA ANAND VS THE INCOME TAX OFFICER, WARD 3, ANAND PA NO. AABFD 6892 O (APPELLANT) (RESPONDENT) APPELLANT BY SHRI J. P. SHAH, AR RESPONDENT BY SHRI H. P. MEENA, SR. DR O R D E R PER BHAVNESH SAINI: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED CIT(A)-IV , BARODA DATED 24 TH SEPTEMBER, 2007 FOR ASSESSMENT YEAR 2003-04 CHALLEN GING THE ADDITION OF RS.29,89,699/- MADE ON THE BASIS OF DIF FERENCE BETWEEN SODA BOOK AND PURCHASE REGISTER. 2. THE ASSESSEE RAISED ADDITIONAL GROUND OF APPEAL CHALLENGING THE VALIDITY OF THE ASSESSMENT ORDER ON THE GROUND THAT NOTICE U/S 143(2) OF THE IT ACT WAS SERVED BEYOND THE PERIOD O F LIMITATION. THE LEARNED COUNSEL FOR THE ASSESSEE SOUGHT TIME TO FIL E SOME EVIDENCES OR MATERIALS IN SUPPORT OF THE AFORESAID ADDITIONAL GROUND OF APPEAL. HOWEVER, DURING THE COURSE OF ARGUMENTS HE DID NOT PRESS THE ADDITIONAL GROUND OF APPEAL STATING THAT ON VERIFIC ATION OF FACTS NO ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 2 CASE IS MADE OUT TO PRESS THE ADDITIONAL GROUND OF APPEAL. REQUEST FOR ADMISSION OF ADDITIONAL GROUND WAS DISMISSED AS NOT PRESSED. 3. ON THE MAIN GROUND OF APPEAL OF THE ASSESSEE, TH E FACTS OF THE CASE ARE THAT A SURVEY U/S. 133A OF THE IT ACT WAS CARRIED OUT ON THE PREMISES OF THE ASSESSEE ON 3-09-2002. NO DISCREPAN CY IN THE STOCK AVAILABLE WAS FOUND. NO DISCLOSURE OF ANY INCOME WA S MADE. HOWEVER, A DIFFERENCE IN THE PURCHASE REGISTER AND SODA DIARY WAS FOUND. AS PER PURCHASE REGISTER THE TOTAL PURCHASES WERE MADE VALUED AT 1,75,446 KGS. AS PER THE SODA DIARY THE T OTAL PURCHASES SHOULD HAVE BEEN 3,98,900 KGS. THIS DIFFERENCE OF 2 ,23,454 KGS. VALUED AT RS.29,89,699/- WAS TO BE RECONCILED. THE AO AFTER CARRYING OUT VERIFICATION FROM THIRD PARTIES AND ALSO CROSS CHECKING THE INFORMATION AVAILABLE AFTER THE SURVEY REACHED AT T HE CONCLUSION THAT THE ASSESSEE WAS UNABLE TO RECONCILE THE DIFFERENCE IN STOCK AS PER THE SODA DIARY AND THE STOCK REGISTER. HE THEREFORE , ADDED THE DIFFERENCE TO THE INCOME OF THE ASSESSEE. THE ADDIT ION MADE WAS OF RS.29,89.699/-. 4. IN APPEAL BEFORE THE LEARNED CIT(A), THE ASSESSE ES COUNSEL WAS GIVEN OPPORTUNITY TO RECONCILE THE DIFFERENCE. THE ASSESSEE FILED A SHEET OF PAPER WHEREIN HE STATED AS UNDER: QUANTITY AS PER SODA DIARY 3,98,900 KGS. PURCHASES: 1) ACTUAL PURCHASE FROM SAME PERSON 1,23,643 KGS ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 3 2) ACTUAL PURCHASE FROM CHANGE OF PERSON 2,14,320 KGS 3,37,963 KGS. SODA CANCELLED 32,000 KGS. NET DIFFERENCE IN PURCHASE 28,937 KGS. TOTAL 3,98,900 KGS. IN MAKING HIS FURTHER SUBMISSIONS, WHEREIN HE HAS E XPLANATORY STATEMENT SHOWING STOCK REGISTER, SODA DIARY, ACTUA L PURCHASE HE STATED THE FOLLOWING: TOTAL QUANTITY AS PER SODA DIARY 3,98,900 KGS. ACTUAL PURCHASES: I) SAME PERSON FROM WHOM SODA RECORDED 1,39,549.30 KGS. II) CHANGE OF PERSON 1,98,413.80 KGS. III) SODA CANCELLED 32,000.00 KGS. IV) NET DIFFERENCE PURCHASE 28,936.90 KGS. TOTAL 3,98,900.00 KGS. VIDE HIS LETTER DATED 30.11.2006, THE ASSESSEE REIT ERATED THE ABOVE DETAILS AND VIDE LETTER DATED 9-3-2007 THE ASSESSEE SUBMITTED THE FOLLOWING DETAILS: I) PURCHASE COMPARED WITH SODA DIARY 3,09,026.20 KGS. II) OTHER PURCHASE NOT COMPARED WITH SODA DIARY 88,225.80 KGS. III) PURCHASE FROM PARTNERS 62,984.70 KGS. TOTAL 4,60,236.70 KGS. VIDE LETTER DATED 6-8-2007, THE ASSESSEE SUBMITTED THE FOLLOWING DETAILS: ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 4 SODA DIARY TOTAL KGS. ACTUAL PURCHASE KGS. AS PER SODA DIARY 3,98,900.00 4,60,236.70 ACTUAL PURCHASES: SAME PERSON FROM WHO SODA RECORDED CHANGE OF PERSON (PERSONS BELONGING TO SAME FAMILY) SODA CANCELLED NET DIFFERENCE SHORTAGE IN ABOVE PURCHASE OTHER PURCHASE NOT TAKEN AND HENCE NOT COMPARED WITH SODA DIARY PURCHASE FROM PARTNERS 1,39,549.30 1,98,413.80 32,000.00 28,936.90 NIL NIL 1,39,549.30 1,98,413.80 --- --- 59,286.70 62,984.70 TOTAL QUANTITY KGS. 3,98,900.00 4,60,236.70 5. THE LEARNED CIT(A) HOWEVER, DID NOT ACCEPT THE C ONTENTION OF THE ASSESSEE AND DISMISSED THIS GROUND OF APPEAL. H IS FINDINGS IN PARA 3.7 TO 3.9 ARE REPRODUCED AS UNDER: 3.7 FROM THE ABOVE, IT CAN BE SEEN THAT THE APPELL ANT HAS BEEN UNABLE TO RECONCILE THE DIFFERENCE BETWEEN THE SODA DIARY AND THE PURCHASE REGISTER. THE APPELLANT HAS ALSO NOT BEEN ABLE TO RECONCILE THE ACTUAL PURCHASE S MADE BY IT. IF THE RECONCILIATION ATTEMPTED BY THE APPELLANT VIDE ITS LETTER DATED 6.8.2007 IS ACCEPTED THEN THE FOLLOWING EMERGES: TOTAL PURCHASES AS PER STOCK REGISTER 1,75,446 K GS. CHANGE OF PERSONS 1,98,413 ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 5 PURCHASE FROM PARTNERS 62,985 OTHER PURCHASES NOT TAKEN IN SODA DIARY 59,287 4,96,131 AS PER BOOKS THE TOTAL PURCHASE IS 460237 KGS. THER EFORE, THERE IS A DIFFERENCE BETWEEN THE PURCHASES AS PER THE BOOKS OF ACCOUNTS AND PURCHASES SAID TO HAVE BEEN MADE FROM VARIOUS PARTIES. 3.8 IT IS OBVIOUS FROM THE ABOVE FACT THAT THE APPE LLANTS BOOKS OF ACCOUNTS AND THE DETAILS OF PURCHASES MADE BY THE APPELLANT FIRM CANNOT BE RELIED UPON. THE SURVE Y TOOK PLACE ON 3.09.2002. THE DETAILS HAVE BEEN CALLED FO R IN 2007. THERE IS ABSOLUTELY NO JUSTIFICATION FOR THER E, TO BE A DISCREPANCY IN THE FIGURES FILED TIME TO TIME. IT I S OBVIOUS THAT THE APPELLANT HAS BEEN SUBMITTING DETAILS WHIC H DO NOT HAVE A RELIABLE BASIS. THE SAME WAS NOTED BY TH E ASSESSING OFFICER AND THEREFORE, THE ADDITION WAS M ADE. THEREFORE, THE DETAILS SUBMITTED BY THE APPELLANT C ANNOT BE RELIED UPON. FURTHER THE DISCREPANCY BETWEEN THE SAUDA DIARY AND PURCHASE REGISTER OF 2,23,454 KGS. STANDS UNEXPLAINED. 3.9 SINCE THE APPELLANT HAS FAILED TO PROVIDE AN EXPLANATION OF THE DISCREPANCY BETWEEN THE SODA DIA RY AND THE PURCHASE REGISTER, I DO NOT THINK THIS IS A FIT CASE FOR INTERFERING WITH THE ADDITION OF RS.29,89,699/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF DIFFERENCE IN PURCHASE AS PER PURCHASE REGISTER AND PURCHASE AS P ER THE SODA DIARY. 6. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND R EFERRED TO PB-84 WHICH IS STATEMENT RECORDED DURING THE COURSE OF SU RVEY AND SUBMITTED THAT THE ASSESSEE EXPLAINED THE DIFFERENC E BETWEEN THE PURCHASE REGISTER AND THE SODA BOOK. HE HAS ALSO RE FERRED TO PB-9 ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 6 WHICH IS THE DETAIL PREPARED DURING THE COURSE OF S URVEY SHOWING THE DIFFERENCE AS PER STOCK REGISTER AND SODA DIARY AND POINTED OUT THAT THE SAME IS ALSO REPRODUCED BY THE AO IN THE ASSESS MENT ORDER AND WOULD DISCLOSE THAT MANY TRANSACTIONS RECORDED ON S ODA DIARY HAVE BEEN RECORDED IN THE STOCK REGISTER LEAVING MINOR D IFFERENCE IN THE SAME:- LIKE FIRST ENTRY AS PER SODA DIARY CONTAINS DETAILS OF PURCHASES OF 16000 KGS AND AS PER STOCK REGISTER THE QUANTITY PURCHASED IS 15906 KGS. THERE IS A DIFFERENCE OF 94 KGS ONLY. HE HAS SUBMITTED THAT MANY TIMES SODA IS ENTERED FOR MAKING PURCHASE S BUT ACTUAL QUANTITY AT THE TIME OF PURCHASE WOULD BE LESS OR M ORE, THEREFORE, ACTUAL PURCHASES ARE RECORDED IN THE PURCHASE REGIS TER/STOCK REGISTER. HE HAS SUBMITTED THAT SODA FIGURE IS, THEREFORE, AL WAYS IN ROUND FIGURE BUT ACTUAL PURCHASES ARE NOTED IN EXACT QUANTITY. T HEREFORE, SUCH DIFFERENCE SHALL HAVE TO BE IGNORED. HE HAS FURTHER SUBMITTED THAT SOMETIMES SODA TRANSACTIONS FOR PURCHASES ARE ENTER ED INTO BUT NO PURCHASES ARE ACTUALLY MADE, THEREFORE, NO ADDITION SHOULD BE MADE ON THAT COUNT. HE HAS SUBMITTED THAT THE ASSESSEE H AS SHOWN MORE ACTUAL PURCHASES IN THE BOOKS OF ACCOUNTS AS WAS EX PLAINED BEFORE THE LEARNED CIT(A) AND NET DIFFERENCE SHORTAGE IN P URCHASES WAS STATED TO BE IN 28936.90 KGS. HE HAS SUBMITTED THAT SEVERAL PURCHASES WERE MADE BUT ENTIRE SALES ARE MADE TO M/ S. BHAGAWANDAS SOBHABLAL JAIN AT SAGAR, MADHYA PRADESH WHICH WAS ALSO EXPLAINED BEFORE THE AO. SUCH PARTY USED TO IN TIMATE THE ESTIMATED REQUIREMENT OF BIDI PATTY FOR MANUFACTURI NG OF BIDI AND THE ASSESSEE USED TO ENTER INTO SODA TRANSACTIONS BUT A CTUAL PURCHASES MADE WERE ENTERED INTO THE PURCHASE/STOCK REGISTER. HE HAS SUBMITTED THAT ACTUAL DETAILS AND AFFIDAVIT OF THE PARTIES WERE FILED FOR ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 7 VERIFICATION TO EXPLAIN THAT SOME OF THE TRANSACTIO NS WERE CANCELLED AND SOME OF THE NAMES WERE CHANGED. SOME OF THE PAR TIES FILED AFFIDAVITS AND WERE ALSO PRODUCED AND THEIR STATEME NTS WERE RECORDED. HE HAS SUBMITTED THAT NO EXCESS STOCK WAS FOUND DURING THE COURSE OF SURVEY; THEREFORE, ADDITION IS CLEARL Y UNJUSTIFIED. HE HAS RELIED UPON THE DECISION OF THE HONBLE GUJARAT HIG H COURT IN THE CASE OF CIT VS GURUBACHHAN SINGH J. JUNEJA 302 ITR 63 IN WHICH IT WAS HELD THAT IN ABSENCE OF ANY MATERIAL ON RECORD TO SHOW THAT THERE WAS ANY UNEXPLAINED INVESTMENT MADE BY THE AS SESSEE WHICH WAS REFLECTED BY THE ALLEGED UNACCOUNTED SALE S, THE FINDING OF THE TRIBUNAL THAT ONLY THE GP ON THE SAI D AMOUNT CAN BE BROUGHT TO TAX DOES NOT CALL FOR ANY INTERFERENC E. 6.1 HE HAS ALSO RELIED UPON THE DECISION OF THE HON BLE GUJARAT HIGH COURT IN THE CASE OF CIT VS PRESIDENT INDUSTRI ES 258 ITR 654 IN WHICH IT WAS HELD AS UNDER: HELD, DISMISSING THE APPLICATION FOR REFERENCE, THAT THE AMOUNT OF SALES COULD NOT REPRESENT THE INCOME OF THE ASSESSEE WHO HAD NOT DISCLOSED THE SALES. THE SALES ONLY REPRESENTED THE PRICE RECEIVED BY THE SELLER OF THE GOODS; ONLY THE REALIZATION OF THE EXCESS OVER THE COST INCURRED COULD FORM PART OF THE PROFIT INCLUDED IN THE CONSIDERATION FOR THE SALES. SINCE THERE WAS NO FINDING TO THE EFFECT THAT INVESTMENT BY WAY OF INCURRING THE COST IN ACQUIRING THE GOODS WHICH WERE SOLD HAD BEEN MADE BY THE ASSESSEE AND THAT THAT INVESTMENT WAS ALSO NOT DISCLOSED, ONLY THE EXCESS OVER THE COST INCURRED COULD BE TREATED AS PROFIT. ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 8 6.2 HE HAS ALSO RELIED UPON THE DECISION OF THE HON BLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS S. M. OMER 201 ITR 608 IN WHICH IT WAS HELD THAT ENTIRE RECEIPT CANNOT REPRESENT NET INCOME. HE HAS ALSO RELIED UPON THE DECISION OF THE HONBLE AL LAHABAD HIGH COURT IN THE CASE OF ASHOK KUMAR RASTOGI VS CIT 100 CTR 2 04 IN WHICH IT WAS HELD THAT WITHOUT REFERENCE TO ANY SUPPORTING EVIDENCE OR MATERIAL ITO CANNOT MAKE ANY ADDITION AS UNEXPLAINE D INVESTMENT NOTWITHSTANDING SEIZURE OF CERTAIN DOCUM ENTS FROM THE ASSESSEE. 6.3 THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER SU BMITTED THAT SINCE THE ASSESSEE EXPLAINED THE DIFFERENCE IN THE SODA REGISTER AND THE PURCHASE REGISTER, THEREFORE, ADDITION SHOULD B E DELETED OR AT THE MOST NET PROFIT RATE MAY BE APPLIED OR THE DIFFEREN CE WHICH COULD NOT BE EXPLAINED BEFORE THE LEARNED CIT(A) IN 28936 KGS . MAY BE CONSIDERED FOR THE PURPOSE OF ADDITION. 7. ON THE OTHER HAND, THE LEARNED DR RELIED UPON TH E ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT FINDING OF FAC T RECORDED BY THE AUTHORITIES BELOW HAVE NOT BEEN REBUTTED THROUGH EV IDENCE ON RECORD BECAUSE NO PROPER RECONCILIATION IS FILED. HE HAS S UBMITTED THAT THE ASSESSEE MADE FALSE EXPLANATION, THEREFORE, THE ADD ITION IS JUSTIFIED. 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT SURV EY U/S 133A OF THE IT ACT WAS CARRIED OUT ON 3-09-2002 AT THE BUSINESS PR EMISES OF THE ASSESSEE IN WHICH IT WAS FOUND THAT SUBSTANTIAL PUR CHASE OF TOBACCO WAS MADE FROM 3 PARTIES AND DURING THE COURSE OF SU RVEY STATEMENT ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 9 WAS PREPARED AND DISCREPANCIES WERE FOUND BETWEEN S ODA DIARY AS WELL AS ACTUAL MATERIAL RECEIVED DURING THE SURVEY OPERATION. COPY OF SUCH STATEMENT IS FILED AT PAGE 9 OF THE PAPER BOOK WHICH IS ALSO REPRODUCED AT PAGE 4 AND 5 OF THE ASSESSMENT ORDER TO SHOW THAT THE DIFFERENCE WAS OF RS.29,89,699/-. THE EXPLANATION O F THE ASSESSEE WAS CALLED FOR ON THE BASIS OF THE MATERIAL FOUND D URING THE COURSE OF SURVEY ABOUT THE DISCREPANCIES IN THE PURCHASES AS PER SODA DIARY AND STOCK REGISTER AND THE ASSESSEE FILED REPLY TO THE SHOW-CAUSE NOTICE IN WHICH IT WAS EXPLAINED THAT THE ASSESSEE MADE SALES TO M/S. BHAGAWANDAS SOBHALAL JAIN AND AT THEIR INSTANCE BID I PATTY AND TOBACCO WAS PURCHASED. THE SAID PARTY GAVE ESTIMATE D REQUIREMENTS TO THE ASSESSEE FOR WHOLE OF THE YEAR. IT WAS ALSO EXPLAINED THAT IN THE SODA DIARY THE ORAL PROMISES TO PURCHASE THE MATERI AL IS RECORDED BUT WHENEVER ACTUAL ITEMS ARE PURCHASED THE SAME ARE RE CORDED IN THE BOOKS OF ACCOUNTS AND PURCHASE REGISTER. SINCE THE SURVEY IS CONDUCTED ON 3-09-2002, THEREFORE PROVISIONS OF SEC TION 292 C OF THE IT ACT WOULD APPLY TO THE ASSESSMENT YEAR UNDER APP EAL WHICH READS AS UNDER: PRESUMPTION AS TO ASSETS, BOOKS OF ACCOUNT, ETC. 292C. [(1)] WHERE ANY BOOKS OF ACCOUNT, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUA BLE ARTICLE OR THING ARE OR IS FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON IN THE COURSE OF A SEARCH UNDER SECTION 132 [OR SURVEY UNDER SECTION 133A ], IT MAY, IN ANY PROCEEDING UNDER THIS ACT, BE PRESUMED ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 10 (I) THAT SUCH BOOKS OF ACCOUNT, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING BELONG OR BELONGS TO SUCH PERSON; (II) THAT THE CONTENTS OF SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS ARE TRUE; AND (III) THAT THE SIGNATURE AND EVERY OTHER PART OF SU CH BOOKS OF ACCOUNT AND OTHER DOCUMENTS WHICH PURPORT TO BE IN THE HANDWRITING OF ANY PARTICULAR PERSON OR WHICH MAY REASONABLY BE ASSUMED TO HAVE BEEN SIGNED BY, OR TO BE IN THE HANDWRITING OF , ANY PARTICULAR PERSON, ARE IN THAT PERSONS HANDWRITING, AND IN THE CASE OF A DOCUMENT STAMPED, EXECUTED OR ATTESTED, THAT IT WAS DULY STAMPED AND EXECUTED OR ATTESTED BY THE PERSON BY WHOM IT PURPORTS TO HAVE BEEN SO EXECUTED OR ATTESTED.] [(2) WHERE ANY BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSETS HAVE BEEN DELIVERED TO THE REQUISITIONING OFFICER IN ACCORDANCE WITH THE PROVISIONS OF SECTION 132A , THEN, THE PROVISIONS OF SUB-SECTION (1) SHALL APPLY AS IF SUCH BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSETS WHICH HAD BEEN TAKEN INTO CUSTODY FROM THE PERSON REFERRED TO IN CLAUSE (A) OR CLAUSE (B) OR CLAUSE (C), AS THE CASE MAY BE, OF SUB-SECTION (1) OF SECTION 132A , HAD BEEN FOUND IN THE POSSESSION OR CONTROL OF THAT PERSON IN THE COURSE OF A SEARCH UNDER SECTION 132 .] ACCORDING TO THE ABOVE PROVISION AMENDMENT IS MADE MAKING THE ABOVE PROVISION APPLICABLE TO THE SURVEY U/S 133A W ITH EFFECT FROM 1-06-2002. THEREFORE, IT HAS TO PRESUME THAT THE CO NTENTS OF SODA DIARY AND PURCHASE REGISTER AND OTHER DOCUMENTS FOU ND IN SURVEY FROM THE ASSESSEE ARE TRUE AND CORRECT. THUS, ONUS WOULD BE UPON ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 11 THE ASSESSEE TO EXPLAIN THE ITEMS RECORDED IN THE M ATERIAL FOUND DURING THE COURSE OF SURVEY, OTHERWISE, ADDITION CA N BE MADE ON THE BASIS OF INCRIMINATING DOCUMENTS FOUND DURING THE C OURSE OF SURVEY. SUCH A PRESUMPTION IS OF COURSE REBUTTABLE. THE ASS ESSEE IN ORDER TO EXPLAIN THE CONTENTS OF SODA DIARY EXPLAINED THAT T HERE IS A MINOR DIFFERENCE IN SOME OF THE ENTRIES OF SODA DIARY WHI CH ARE IN ROUND FIGURE AS COMPARED WITH THE ACTUAL ENTRIES OF THE S TOCK REGISTER. THEREFORE, SUCH DIFFERENCE SHALL HAVE TO BE IGNORED . WE FIND FORCE IN THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSES SEE BECAUSE SODA ENTRY WAS A PROMISE TO DELIVER THE MATERIAL TO THE ASSESSEE AT FUTURE DATE BUT WHEN ACTUAL MATERIAL IS PURCHASED, THE ACT UAL FIGURES ARE RECORDED IN THE PURCHASE/STOCK REGISTER. WHEN NO AC TUAL PURCHASE MADE NO ENTRY WOULD APPEAR IN PURCHASE/STOCK REGIST ER. THEREFORE, SUCH DIFFERENCES SHALL HAVE TO BE IGNORED BECAUSE T HE ACTUAL PURCHASES ARE RECORDED IN THE BOOKS OF ACCOUNTS ON THE BASIS OF SODA REGISTER. THE ASSESSEE FURTHER EXPLAINED THAT THE F IGURE OF SOME PERSONS ARE RECORDED FROM WHOM SODA ARE RECORDED. T HEREFORE, SUCH EXPLANATION IS ACCEPTABLE. THE ASSESSEE FURTHER EXP LAINED THAT THERE IS CHANGE OF PERSONS BELONGING TO SAME FAMILY FOR W HICH THE ASSESSEE FILED EXPLANATION AND AFFIDAVITS, FURTHER SOME SODA WERE CANCELLED FOR WHICH ALSO AFFIDAVITS WERE FILED AS W ELL AS SOME PARTIES WERE PRODUCED. SOME OF THE STATEMENTS ARE ALSO FILE D IN THE PAPER BOOK WHICH SUPPORTS THE CONTENTION OF THE ASSESSEE. THUS, THE EXPLANATION OF THE ASSESSEE APPEARS TO BE BONA FIDE THAT THERE WAS NO SUBSTANTIAL DIFFERENCE IN THE SODA REGISTER AND THE PURCHASE REGISTER. THIS FACT IS ALSO SUPPORTED BY THE FACT T HAT DURING THE COURSE OF SURVEY NO EXCESS STOCK WAS FOUND. THEREFORE, EXP LANATION OF THE ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 12 ASSESSEE SHALL HAVE TO BE ACCEPTED FOR RECONCILING THE DETAILS NOTED IN THE SODA REGISTER AND PURCHASE REGISTER. HOWEVER , THE ASSESSEE SUBMITTED BEFORE THE LEARNED CIT(A) STILL THERE WAS A NET DIFFERENCE/SHORTAGE IN THE PURCHASES AT 28936.90 KG S. FOR WHICH NO EXPLANATION IS FILED BEFORE US. ULTIMATELY, THE ASS ESSEE EXPLAINED BEFORE THE AUTHORITIES THAT ACTUAL PURCHASES RECORD ED ARE MORE IN THE PURCHASE REGISTER BUT NO RECONCILIATION IS FILED FO R SHORTAGE OF 28936.90 KGS. FOR WHICH ADDITION SHALL HAVE TO BE M AINTAINED BY FOLLOWING THE PROVISION OF SECTION 292C OF THE IT A CT BECAUSE ASSESSEE WAS UNABLE TO EXPLAIN SUCH DIFFERENCE. THE DECISIONS CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE WOULD NOT S UPPORT THE CASE OF THE ASSESSEE IN VIEW OF THE SPECIFIC INCRIMINATI NG DOCUMENTS/MATERIALS FOUND DURING THE COURSE OF SURV EY AGAINST THE ASSESSEE. THEREFORE, CONSIDERING THE TOTALITY OF TH E FACTS AND CIRCUMSTANCES NOTED ABOVE, WE ARE OF THE VIEW THE A DDITION SHALL HAVE TO BE RESTRICTED TO THE UNEXPLAINED PURCHASES OF 28936.90 KGS. ONLY WHICH WAS ALSO ADMITTED IN THE STATEMENT BEFOR E THE LEARNED CIT(A) AS AGAINST 223.454 KGS. ACCORDINGLY, WE MOD IFY THE ORDERS OF THE AUTHORITIES BELOW AND DELETE SUBSTANTIAL ADDITI ON. THE AO IS DIRECTED TO RESTRICT THE ADDITION TO THE DIFFERENCE IN STOCK AS PER SODA DIARY AND STOCK REGISTER IN 28936.90 KGS ONLY AND S HALL MAKE REASONABLE ADDITION ON ACCOUNT OF UNEXPLAINED PURCH ASES/STOCK. ITA NO.4463/AHD/2007 M/S. DHIRUBHAI GIRDHARBHAI & SONS VS ITO, WARD-3, A NAND 13 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED PARTLY. ORDER PRONOUNCED IN THE OPEN COURT ON 29-04-2011 SD/- SD/- (G. D. AGARWAL) VICE PRESIDENT (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 29-04-2011 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