Jain Rice Mills, Kurukshetra V. JCIT, Kurukshetra

ITA 701/CHANDI/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8300 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 09-03-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 26-06-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: RAKESH JAIN SHRI GUNJEET SINGH
• Keywords: Loose papers; Bad and doubtful debts
• Section: 143(3); 133A; 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS.RANO JAIN, ACCOUNTANT MEMBER ITA NO. 701/CHD/2012 ASSESSMENT YEAR: 2007-08 M/S JAIN RICE MILLS, VS THE JCIT, AMIN ROAD, KURUKSHETRA RANGE, KURUKSHETRA. KURUKSHETRA. PAN: AAEFJ0706E (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RAKESH JAIN SHRI GUNJEET SINGH RESPONDENT BY : SHRI S.K.MITTAL, DR DATE OF HEARING : 28.03.2016 DATE OF PRONOUNCEMENT : 31.03.2016 O R D E R PER BHAVNESH SAINI,JM THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) KARNAL DATED 16.03.20 12 FOR ASSESSMENT YEAR 2007-08. 2. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE MATERIAL ON RECORD AND CONSIDE RED THE FINDINGS OF THE AUTHORITIES BELOW. 3. THE LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS GROUND NO. 1(A) OF THE APPEAL, THE SAME IS THEREFOR E, DISMISSED AS NOT PRESSED. 2 4. THE REMAINING GROUNDS OF APPEAL FROM GROUND NO. 1(B) TO GROUND NO. 6 READ AS UNDER : 1.(B) THE ACTION OF THE CIT(A) IN UPHOLDING THE ASSE SSMENT ORDER FOR AN ADDITION OF RS 44,28,447/- ATTRIBUTABLE TO UND ER BILLING OF PADDY IS BEING CHALLENGED ON FACTS AND LAW AND EVEN T HE QUANTUM OF ADDITIONS ARE BEING CONTESTED. 2. THE ACTION OF THE CIT(A) IN UPHOLDING THE ASSESSM ENT ORDER FOR AN ADDITION OF RS 1,98,202/- ATTRIBUTABLE TO INVOKIN G THE PROVISIONS OF SECTION 40A(2) IS BEING CHALLENGED ON FACTS AND LAW AND EVEN THE QUANTUM OF ADDITIONS ARE BEING CONTESTED. 3. THE ACTION OF THE CIT(A) IN UPHOLDING THE ASSESSMEN T ORDER FOR AN ADDITION OF RS 7,75,001/- ATTRIBUTABLE TO B AD DEBTS IS BEING CHALLENGED ON FACTS AND LAW AND WITHOUT CONS IDERING THE RATIO - DECENDI OF THE DECISION OF VIJAYA BANK (SUPREME COURT). 4. THE ACTION OF THE CIT(A) IN UPHOLDING THE ASSESSMEN T ORDER FOR AN ADDITION OF RS 33,00,029/- ATTRIBUTABLE TO SALE OF RICE BRAN AT THE LOWER RATE IS BEING CHALLENGED ON FACTS AND L AW AND EVEN THE QUANTUM OF ADDITIONS ARE BEING CONTESTED. 5. THE ACTION OF THE CIT(A) IN UPHOLDING THE ASSESSM ENT ORDER FOR AN ADDITION OF RS 147478.40/-( BEING 10% OF RS 14,74,784/- ) ATTRIBUTABLE TO ADHOC DISALLOWANCE FOR THE WAGES E XPENSES IS BEING CHALLENGED ON FACTS AND LAW AND EVEN THE QUANT UM OF ADDITIONS ARE BEING CONTESTED. 6. THE ACTION OF THE CIT(A) IN UPHOLDING THE ASSESSMENT ORDER FOR VARIOUS ADDITIONS WITHOUT EXAMINING THE IMPACT FOR TH E 'SURRENDERED AMOUNT' OF RS 40,00,000/- AND THE 'TELESCO PING EFFECT' THEREOF IN THE ADDITIONS SUSTAINED. 3 5. THE FACTS OF THE CASE ARE THAT ASSESSEE FIRM HAS BEEN ENGAGED IN THE BUSINESS OF MANUFACTURING AND S ALE OF RICE, TRADING OF PADDY AND RICE AND MILLING OF P ADDY ON JOB WORK BASIS. THE ASSESSEE FILED RETURN OF IN COME AT RS. 77,314/- WHICH WAS REVISED DECLARING NET LOS S OF RS. 3,92,016/- DUE TO CLAIM OF INTEREST PAYABLE TO THE PARTNERS. THE SURVEY ACTION UNDER SECTION 133A OF THE INCOME TAX ACT WAS CARRIED OUT AT THE BUSINESS PREM ISES OF THE ASSESSEE FIRM ON 19.01.2007. THE ASSESSEE DECLARED ADDITIONAL INCOME OF RS. 40 LACS TO COVER UP ALLEGED DISCREPANCIES IN THE BOOKS OF ACCOUNT, LOOS E PAPERS, DOCUMENTS AND STOCK ETC. DETECTED DURING SURVEY. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT THE ADDITIONAL INCOME OF RS. 40 LACS DECLARED AND CREDITED IN THE PROFIT & L OSS ACCOUNT AND AFTER EXCLUDING THE SAME, THERE IS A TR ADING LOSS OF RS. 39,22,687/-. THE ASSESSING OFFICER FUR THER NOTED THAT ASSESSEE HAD BEEN DECLARING MARGINAL INC OME YEAR AFTER YEAR WHICH SHOWS THAT ASSESSEE HAS BEEN SUPPRESSING ITS INCOME IN EARLIER YEARS AS WELL. 6. THE ASSESSING OFFICER REFERRED TO DOCUMENT D-1 A ND D-2 WHICH WERE IMPOUNDED DURING SURVEY. THESE DOCUMENTS REVEALED UNDISCLOSED ENTRIES WHICH WERE N OT ENTERED IN THE BOOKS OF ACCOUNT. THE TOTAL UNDISCL OSED CASH RECEIVED AS PER THESE DOCUMENTS WORKED OUT TO RS. 95,91,294/-. THE ASSESSING OFFICER NOTED THAT ASSE SSEE HAS NOT FILED ANY EXPLANATION WITH REFERENCE TO THI S 4 UNACCOUNTED CASH RECEIVED EXCEPT TO SAY THAT SAME A RE COVERED BY ADDITIONAL INCOME OF RS. 40 LACS SURREND ERED DURING THE COURSE OF SURVEY. THE ASSESSING OFFICER ADDED THE PEAK OF CREDITS OF ENTRIES RECORDED IN TH ESE DOCUMENTS WHICH WORKED OUT TO RS. 6,03,692/- AND ADDED TO THE INCOME OF THE ASSESSEE AS UNDISCLOSED INCOME PERTAINING TO RICE TRADING SINCE ASSESSEE FA ILED TO OFFER ANY EXPLANATION IN THIS REGARD. 7. THE ASSESSING OFFICER NOTED THAT ASSESSEE SOLD 18212.5 QTLS. SUPER FINE PADDY AT AN AVERAGE RATE O F RS. 482/- TO RS. 548/- TO M/S VIJAY TRADERS, COMMISSION AGENT, DELHI AND @ RS. 537/- TO RS.548/- TO M/S AKA SH ENTERPRISES, DELHI, WHEREAS THE SAME PADDY WAS PURCHASED AT RATES VARYING RS. 666/- TO RS. 841/- P R QUINTAL FROM 07.04.2006 TO 07.01.2007. THE ASSESSI NG OFFICER FURTHER NOTED THAT AS LATE AS ON 06.01.2007 AND 07.01.2007, SUPER FINE PADDY WEIGHING 1318.49 QTL. WAS PURCHASED @ RS. 775/- TO 778/- PER QUINTAL FROM M/S BALA SUNDRI RICE MILLS, INDRI. IN VIEW OF THESE FA CTS, ASSESSING OFFICER ASKED THE EXPLANATION OF THE ASSE SSEE THAT SUPER FINE PADDY WAS SHOWN TO BE SOLD AT 75% O F THE PREVAILING PRICE OF SUPER FINE PADDY IN THE MAR KET WHICH RESULTED IN CLAIM OF LOSS OF RS. 44,28,447/- ON PURCHASE AND SALE OF SUPER FINE PADDY WEIGHING 18212.50 QTLS WHICH WAS PURCHASED AT THE AVERAGE RA TE OF RS. 754/- PR QUINTAL FOR RS. 1,37,32,225/- AND W AS CLAIMED TO BE SOLD FROM 31.01.2007 TO 31.03.2007 FO R 5 RS. 93,03,778/- ONLY. THE ASSESSING OFFICER REJECT ED THE CONTENTION OF THE ASSESSEE AND HELD THAT THE ASSESS EE SUPPRESSED THE SALE VALUE OF SUPER FINE PADDY SUBSEQUENT TO THE DATE OF SURVEY IN ORDER TO SET OF F THE ADDITIONAL INCOME DECLARED DURING THE COURSE OF SUR VEY. THE ASSESSING OFFICER, THEREFORE, MADE ADDITION OF RS. 44,28,447/-. 7(I) THIS ADDITION WAS CHALLENGED BEFORE LD. CIT(APPEALS) AND IT WAS SUBMITTED THAT ASSESSEE MAINTAINED PROPER BOOKS OF ACCOUNT AND CONFIRMATION S OF MOST OF THE PARTIES HAVE BEEN FILED. THE PAYMENT S ARE GOT VERIFIED FROM THE BANK ACCOUNTS. ALL THE DISPAT CH OF THE GOODS WERE ALSO CROSS-VERIFIED FROM THE DELIVER Y CHALLANS, STOCK REGISTER AND TRANSIT BILL AND STATU TORY SALES TAX PAPERS ALONGWITH GOODS TRANSFER THROUGH T HE VEHICLE ETC. THE SUMMONS WERE ISSUED TO THE TRANSPORTERS WHO HAVE ALSO COMPLIED WITH THE NOTICE . EVEN PAYMENT AND SALES OF PADDY AND RICE BRAN WERE VERIFIED FROM THE BOOKS OF ACCOUNT OF THE PURCHASER S. ALL PARTIES WITH WHOM THE DEALINGS HAVE BEEN MADE ARE ASSESSED TO TAX AND ALSO MAINTAINED PROPER BOOKS OF ACCOUNT. THE ASSESSING OFFICER MADE THE ADDITION O N ACCOUNT OF PADDY BY ADOPTING MARKET RATE OF RS. 754 /-. ON THE OTHER HAND, ASSESSING OFFICER ACCEPTED SALE OF 592.93 QTLS. MADE BY ASSESSEE AT THE AVERAGE RATE O F RS. 650/- EXECUTED AT THE PREVAILING MARKET RATE AND AL SO COMPLETELY IGNORED BY THE ASSESSING OFFICER. 6 8. THE LD. CIT(APPEALS) CONFIRMED THE REJECTION OF THE BOOKS OF ACCOUNT UNDER SECTION 145(3) AS WAS MADE B Y ASSESSING OFFICER ON ACCOUNT OF SURVEY CONDUCTED IN THE CASE OF ASSESSEE AND INCRIMINATING DOCUMENTS FOUND DURING THE COURSE OF SURVEY AND SURRENDER MADE BY T HE ASSESSEE. AS REGARDS THE ADDITION ON MERIT, LD. CIT(APPEALS) NOTED THAT ASSESSEE HAS SHOWN THE SALE PRICE AT LESSER AMOUNT AS AGAINST THE PURCHASE MADE OF THE SAME SUPERFINE PADDY AT A HIGHER RATE. THE LD. CIT(APPEALS) ALSO NOTED THAT ASSESSING OFFICER HAS VERIFIED FROM THE ANAJ MANDI, KURUKSHETRA THAT PADD Y WAS NEVER LESS THAN RS. 732/- PER QUINTAL WHEREAS ASSESSEE HAS SOLD THE SUPERFINE PADDY AT A LESSER R ATE. THE LD. CIT(APPEALS) DID NOT ACCEPT CONTENTION OF T HE ASSESSEE THAT ASSESSEE MAINTAINED PROPER BOOKS OF ACCOUNT AND ALL THE PAYMENTS ARE VERIFIED THROUGH T HE BANK ACCOUNTS ALONGWITH DELIVERY CHALLANS AND STOCK REGISTER ETC. THE LD. CIT(APPEALS) ALSO NOTED THAT IN EARLIER YEAR ALSO, VERY MEAGER INCOME HAVE BEEN SHO WN ON THIS ACCOUNT. IT WAS ALSO NOTED THAT ASSESSEE I N COLLISION WITH THESE PARTIES, HAVE SHOWN LESSER CONSIDERATION AND ACCORDINGLY, CONFIRMED THE ADDITI ON OF RS. 44,28,447/- ON WHICH ASSESSEE HAS RAISED GROUND NO. 1(B) OF THE GROUNDS OF APPEAL. 9. THE ASSESSING OFFICER ALSO NOTED THAT ASSESSEE H AS PURCHASED 1979.31 QUINTALS SUPERFINE PADDY FROM SIS TER CONCERN M/S ATMA RAM DAMAN KUMAR, KURUKSHETRA 7 FROM 14.10.2006 TO 31.10.2006 @ RS. 840/- PER QUINT AL AMOUNTING TO RS. 16,62,891/- INCLUDING BARDANA VAT ETC. HOWEVER, FROM THE CASH-BOOK OF M/S ATMA RAM DAMAN KUMAR WHO HAVE PURCHASED PADDY FROM M/S ATMA RAM NEM KUMAR ON THE SAME DATES AS ABOVE MUCH BELOW THE RATE OF RS. 840/-. THE DETAILS ARE NOTED IN THE IMPUGNED ORDERS WHICH VARY FROM RS. 729/- TO RS. 76 2/- . IT WAS, THEREFORE, NOTED THAT THE ASSESSEE INFLA TED THE PURCHASES IN VIOLATION OF PROVISIONS OF SECTION 40A (2) OF THE INCOME TAX ACT AND INCURRED EXCESSIVE AND UNREASONABLE COST OF THE PADDY PURCHASES AND ACCORDINGLY, MADE THE ADDITION OF RS. 1,98,202/-. THE ASSESSEE FILED REPLY BEFORE ASSESSING OFFICER ALONG WITH FOUR BILLS OF PADDY OF M/S RAJESH KUMAR JASWANT KUMAR, COMMISSION AGENT BUT ASSESSING OFFICER NOTED THAT GENUINENESS OF THESE BILLS CANNOT BE VERIFIED. THE ASSESSEE REITERATED THE SAME SUBMISSIONS BEFORE LD. CIT(APPEALS) AND IT WAS SUBMITTED THAT ASSESSING OF FICER HAS IGNORED THAT VAT IS NOT INCLUDED IN THE COST PR ICE AND THAT SURRENDER IS ALREADY MADE OF RS. 40 LACS F OR DISCREPANCIES. THEREFORE, NO FURTHER ADDITION IS L IABLE TO BE MADE. THE LD. CIT(APPEALS) DID NOT ACCEPT CONTENTION OF THE ASSESSEE AND NOTED THAT ASSESSEE MADE PURCHASES FROM SISTER CONCERN AT HIGHER PRICE AND ACCORDINGLY CONFIRMED THE ADDITION AND DISMISSED TH IS GROUND OF APPEAL OF THE ASSESSEE ON WHICH ASSESSEE HAS RAISED GROUND NO. 2 OF THE GROUNDS OF APPEAL. 8 10. THE ASSESSING OFFICER FURTHER NOTED THAT ASSESS EE HAS INCURRED BAD DEBTS OF RS. 7,75,001/- IN RESPECT OF THREE PARTIES NAMELY M/S P.LAL TRADERS, HODEL, M/S RATNA RICE INDUSTRIES P. LTD. AND M/S SOHAN RICE MI LLS, AMRITSAR. IT WAS NOTED THAT THESE DEBTS WERE INCUR RED IN FINANCIAL YEAR 2000-01, YET TILL DATE ASSESSEE F AILED TO FILE ANY DOCUMENTARY EVIDENCE IN RESPECT OF ANY EFF ORTS MADE TO RECOVER THESE BAD DEBTS. FURTHER PARTIES F AILED TO APPEAR IN OFFICE OF THE ASSESSING OFFICER, THERE FORE, BAD DEBTS HAVE NOT BEEN PROVED. ITO, WARD-2, PATIA LA ALSO REPORTED THAT THESE ENTRIES ARE NOT APPEARING IN THE BALANCE SHEET OF M/S RATNA RICE INDUSTRIES. THE ASSESSING OFFICER AS PER INFORMATION OBTAINED FROM THE PARTIES UNDER SECTION 131 ALSO NOTED THAT NO BALANC E IS OUTSTANDING AGAINST THE ASSESSEE FIRM AND ACCORDING LY, BAD DEBTS WERE DISALLOWED AND ADDITION WAS MADE. TH E ASSESSEE SUBMITTED BEFORE LD. CIT(APPEALS) THAT BAD DEBTS HAVE BEEN WRITTEN OFF AS IRRECOVERABLE IN THE ACCOUNTS OF THE ASSESSEE, THEREFORE, SAME IS ALLOWA BLE DEDUCTION. THERE IS NO LIABILITY ON THE PART OF TH E ASSESSEE TO PROVE THAT EVERY POSSIBLE EFFORT HAS BE EN MADE TO RECOVER BAD DEBTS. THE LD. CIT(APPEALS), HOWEVER, DID NOT ACCEPT CONTENTION OF THE ASSESSEE BECAUSE THE PARTIES HAVE CONFIRMED THAT NOTHING WAS OUTSTANDING IN RESPECT OF THE ASSESSEE FIRM IN THEI R BOOKS OF ACCOUNT AS ON 31.03.2007. THE ASSESSEE IS IN GROUND NO. 3 OF THE APPEAL ON THIS ISSUES. 9 11. THE ASSESSING OFFICER IN THE ASSESSMENT ORDER A LSO NOTED THAT THE YIELD OF RICE BRAN RETURNED AT 8.44% OF PADDY MILLED 134269 QUINTALS IS CORRECT. THE ASSES SEE HAS SHOWN THE SALE OF RICE BRAN 13890 QTLS. AT LOWE R RATE I.E. RS. 422.41 PER QUINTAL, WHEREAS MARKET RATE WA S RS. 660/- PER QUINTAL. THE ASSESSEE VALUED CLOSING STO CK AT 1200 QTLS. RICE BRAN AT RS. 6,60,000/- AT THE RATE OF RS. 550/- PER QUINTAL WHICH IS MUCH HIGHER THAN THE SAL E RATE AT RS. 422.41 PER QUINTAL AND COMPARABLE CASES WOULD PROVE THAT ASSESSEE HAS SOLD RICE BRAN AT MUC H LOWER THAN THE MARKET RATE TO INCUR HEAVY LOSS TO C OVER UP SURRENDER OF RS. 40 LACS. THE CHART OF VALUATIO N OF COMPARABLE CASE IS REPRODUCED IN THE IMPUGNED ORDER . THE ASSESSEE WAS SHOW CAUSED AS TO WHY SALE OF RICE BRAN MAY NOT BE ADDED TO THE TAXABLE INCOME @ RS. 660/- AND SUPPRESSION OF SALES WAS CALCULATED AT RS . 33,00,029/-. THE ASSESSEE SUBMITTED THAT SALE PRIC E OF RICE BRAN DEPENDS ON CONTENTS OF OIL, QUALITY OF PA DDY AND METHOD OF MILLING I.E. KACHA RICE AND SELA RICE . PURCHASE REGISTER OF RICE BRAN OF M/S GOYA AGO CALL ED FOR UNDER SECTION 131 OF THE INCOME TAX ACT. PERUS AL OF THE REGISTER SHOWS THAT ASSESSEE SOLD RICE BRAN AT ALMOST UNIFORM RATE OF RS. 4,10,415- AND RS. 435/- PER QUINTAL THROUGH OUT THE YEAR. THE ASSESSING OFFICE R ADOPTED THE RATE OF RS. 660/- PER QUINTAL TO BE REASONABLE IN VIEW OF THE COMPARABLE CASES AND MADE THE ADDITION OF RS. 33,00,029/-. 10 12. THE ASSESSEE CHALLENGED THE ADDITION BEFORE LD. CIT(APPEALS) AND IT WAS SUBMITTED THAT ASSESSING OF FICER HAS ACCEPTED THE VALUATION OF CLOSING STOCK AT RS. 550/- PER QUINTAL AND ASSESSEE HAD ALREADY MADE SURRENDER OF RS. 40 LACS THEREFORE, NO ADDITION SHOULD BE MADE. THE LD. CIT(APPEALS) DID NOT ACCEPT THE CONTENTION OF T HE ASSESSEE AND ON THE SAME REASONING AS HAVE BEEN GIV EN BY THE ASSESSING OFFICER, CONFIRMED THE ADDITION. THE ASSESSEE IS ON GROUND NO. 4 CHALLENGING THE CONFIRMATION OF THE ADDITION. 13. THE ASSESSING OFFICER ALSO CONSIDERED OTHER EXPENSES IN ASSESSMENT ORDER INCLUDING THE WAGES WH ICH IS CLAIMED BY ASSESSEE AT RS. 14,74,784/-. THE ASSESSING OFFICER NOTED THAT THESE EXPENSES ARE NOT EXPLAINED WITH REFERENCE TO THE ORIGINAL VOUCHERS A ND MODE OF PAYMENT, THEREFORE, DISALLOWANCE SHOULD BE MADE. THE ASSESSEE CLAIMED THAT THESE EXPENSES HAV E BEEN SUPPORTED BY INTERNAL VOUCHERS. THE ASSESSING OFFICER, HOWEVER, DID NOT ACCEPT CONTENTION OF THE ASSESSEE AND IN VIEW OF THE DOCUMENTS FOUND DURING THE COURSE OF SEARCH, DISALLOWED 25% OF THE WAGES EXPEN SES AND MADE ADDITION OF RS. 5,64,479/-. THE ASSESSEE CHALLENGED THE ADDITION BEFORE LD. CIT(APPEALS) AND IT WAS SUBMITTED THAT ADDITION IS UNJUSTIFIED. THE WA GES WERE INCURRED FOR LOADING AND UNLOADING OF RICE AND PADDY, STOCKING OF PADDY ETC. PAYMENTS ARE MADE AT REGULAR INTERVALS. THE ADDITION IS, THEREFORE, NOT 11 JUSTIFIED. THE LD. CIT(APPEALS) IN PRINCIPLE CONFI RMED THE ADDITION. HOWEVER, CONSIDERING IT TO BE EXCESS IVE IN NATURE, RESTRICTED THE DISALLOWANCE TO 10% OF THE EXPENDITURE CLAIMED AND CONFIRMED THE ADDITION OF R S. 1,47,478/- ON WHICH ASSESSEE IS IN GROUND NO. 5. 14. THE ASSESSEE ON GROUND NO. 6 CHALLENGED THE ORD ER OF LD. CIT(APPEALS) IN CONFIRMING THE ABOVE ADDITIO NS WITHOUT GIVING TELESCOPING BENEFIT OF RS. 40 LACS B EING SURRENDERED AMOUNT. 15. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PARTIES. THE LD. COUNSEL FOR THE ASSESSEE REITERAT ED THE SUBMISSIONS MADE BEFORE AUTHORITIES BELOW AND REFER RED TO PB-1/29 WHICH IS SURRENDER LETTER MADE FOR SURRENDERING ADDITIONAL INCOME OF RS. 40 LACS IN ASSESSMENT YEAR UNDER APPEAL TO COVER UP AL ALLEGED DISCREPANCIES IN THE BOOKS OF ACCOUNT, LOOSE PAPERS , DOCUMENTS, STOCK BY-PRODUCT AND OTHER RECORDS. PB- 1/19 IS PROFIT & LOSS ACCOUNT IN WHICH ASSESSEE ACT UALLY SURRENDERED RS. 40 LACS AS MISCELLANEOUS INCOME FOR THE PURPOSE OF TAXATION. PB-2/1 IS THE DETAILS OF PADD Y SUPERFINE IN ASSESSMENT YEAR UNDER APPEAL TO SHOW T HAT OPENING STOCK WAS HAVING VALUATION OF RS. 650/- PER QUINTAL AND PURCHASES HAVE BEEN MADE @ RS. 665/- PE R QUINTAL. THE LD. COUNSEL FOR THE ASSESSEE FURTHER REFERRED TO PB-2/9 TO 11 WHICH IS DETAILS OF PURCHA SE ACCOUNT OF PADDY SUPERFINE IN SUPPORT OF THE SAME CONTENTION THAT AVERAGE PURCHASE RATE WAS RS. 650/- TO 12 RS. 665/- PER QUINTAL. THE LD. COUNSEL FOR THE ASS ESSEE, THEREFORE, SUBMITTED THAT THE HIGHER RATES MENTIONE D IN THE IMPUGNED ORDERS ARE TOTALLY WRONG. HE HAS REFE RRED TO PB-2/27-29 TO SHOW THAT THE SELLING OF SUPERFINE PADDY WAS RS. 511/- ON AVERAGE BASIS AS AGAINST THE WRONG FIGURES TAKEN BY THE ASSESSING OFFICER. HE H AS SUBMITTED THAT THE RATES VARYING OF THIS COMMODITY BECAUSE OF THE YIELD OBTAINED AND IT BEING PERISHAB LE IN NATURE AND PROCESSING OF THE COMMODITY. HE HAS SUBMITTED THAT PADDY CANNOT BE HELD FOR A LONG PERI OD THEREFORE, RATES GIVEN BY THE ASSESSING OFFICER ARE TOTALLY INCORRECT. HE HAS REFERRED TO PB-3/25 WHIC H IS LIST OF SUNDRY CREDITORS FOR PRECEDING FINANCIAL YE AR 2005-06 IN WHICH ASSESSEE WAS HAVING SUNDRY CREDITO RS IN A SUM OF RS. 2.10 CR. HE HAS REFERRED TO PB-1/2 2 WHICH IS LIST OF SUNDRY CREDITORS AT THE END OF THE FINANCIAL YEAR I.E. 2006-07 IN A SUM OF RS. 25.15 L ACS. HE HAS SUBMITTED THAT ASSESSEE SOLD STOCK OF SUPERF INE PADDY AT THE LESSER RATE BECAUSE ASSESSEE WAS IN NE ED OF MONEY TO CLEAR THE CREDITORS. THESE FACTS WOULD PR OVE THAT ASSESSEE AFTER REALIZING THE AMOUNT OF SALE CONSIDERATION, HAS IMMEDIATELY PAID TO THE CREDITOR . PB-2/8 IS THE PADDY SUPERFINE ACCOUNT PRIOR TO SURV EY AND AFTER SURVEY AND SUBMITTED THAT SAME RATES HAVE BEEN SHOWN WHICH HAVE BEEN WRONGLY TAKEN BY THE ASSESSING OFFICER AT DIFFERENT FIGURES. HE HAS SUB MITTED THAT SINCE PADDY CANNOT BE HELD FOR A LONG PERIOD, THEREFORE, IT WAS SOLD IMMEDIATELY AND IN SUPPORT O F THE 13 CONTENTION, FILED STUDY ON RICE KNOWLEDGE BANK ON RECORD TO PROVE THAT HIGHER MOISTURE CONTENTS RESUL T IN MORE LOSSES. THE LD. COUNSEL FOR THE ASSESSEE SUBM ITTED THAT ALL THESE REASONS HAVE NOT BEEN CONSIDERED BY THE AUTHORITIES BELOW AND ADDITIONS HAVE BEEN MADE WITH OUT ANY JUSTIFICATION. THE LD. COUNSEL FOR THE ASSESSE E FURTHER SUBMITTED THAT ASSESSING OFFICER MADE FURTH ER ADDITION ON ACCOUNT OF RICE BRAN SOLD AT THE LESSER PRICE. HE HAS RELIED UPON ORDER OF ITAT CHANDIGARH BENCH I N THE CASE OF SHAKTI RICE AND GENERAL MILLS, KURUKSHE TRA VS ITO IN ASSESSMENT YEAR 2007-08 IN ITA 764/2011 A ND ITA 726/2011 DATED 30.03.2012 IN WHICH ONE OF THE PARTY, AS CONSIDERED BY ASSESSING OFFICER TO BE COMPARABLE CASE IN THE CASE OF M/S SHIV GANESH INDUSTRIES, SHAHBAD, HAS BEEN CONSIDERED BY AUTHORI TIES BELOW AND THE LD. CIT(APPEALS) HELD RS. 450/- PER QUINTAL TO BE REASONABLE RATE OF SALE OF RICE BRAN. THE ASSESSEE'S APPEAL AS WELL AS DEPARTMENTAL APPEAL HA VE BEEN DISMISSED BY THE TRIBUNAL CONFIRMING THE RATE OF RS. 450/- PER QUINTAL. THE LD. COUNSEL FOR THE ASS ESSEE FURTHER SUBMITTED THAT FOR MAKING ADDITION UNDER SECTION 40A(2), NO COMPARABLE CASE HAVE BEEN CITED AND THIS ADDITION IS ALREADY COVERED BY THE SURRENDERED AMOUNT. 15(I) THE LD. COUNSEL FOR THE ASSESSEE, WITH REGAR D TO BAD DEBTS SUBMITTED THAT IT WAS OLD AMOUNT NOT BEIN G COMING FROM THE PARTIES. THEREFORE, IT WAS WRITTEN OFF 14 IRRECOVERABLE IN THE BOOKS OF ACCOUNT OF THE ASSESS EE WHICH FACT HAVE NOT BEEN DISPUTED BY THE ASSESSING OFFICER. THESE AMOUNTS PERTAIN TO THREE PARTIES WH ICH WERE COMING FROM FINANCIAL YEAR 2000-01 AND SINCE N O AMOUNT IS RECOVERED THEREFORE, IT WAS WRITTEN OFF A S IRRECOVERABLE. HE HAS REFERRED TO PB-2/3 TO 7 WHIC H IS ASSESSMENT ORDER FOR PRECEDING ASSESSMENT YEAR 2006-07 UNDER SECTION 143(3) DATED 26.12.2008 IN WH ICH ALL THE THREE PARTIES NAMELY M/S P. LAL TRADERS, M/ S RATNA RICE INDUSTRIES AND M/S SOHAN RICE MILLS HAVE BEEN CONSIDERED BY ASSESSING OFFICER FROM WHOM NO AMOUNT WAS BEING RECOVERED, THEREFORE, ASSESSING OFFICER ADDED THE INTEREST @ 12%. HE HAS SUBMITTED THAT THE ASSESSEE PREFERRED APPEAL BEFORE ITAT CHANDIGAR H BENCH AND THE TRIBUNAL IN ITA 122 OF 2008 ALLOWED T HE APPEAL OF THE ASSESSEE VIDE ORDER DATED 23.06.2009, COPY OF THE SAME IS FILED AT PB-2/77-79. HE HAS FURTHER SUBMITTED THAT ASSESSING OFFICER DID NOT CONFRONT A NY MATERIAL COLLECTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THEREFORE, NO ADDITION COULD BE MADE AGAINST THE ASSESSEE AND ALSO RELIED UPON DECISION OF THE SUPREME COURT IN THE CASE OF T.R.F. LTD. VS CIT 323 ITR 397. THE LD. COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT WAGES HAVE BEEN DISALLOWED WITHOUT A NY JUSTIFICATION AND IS ADHOC IN NATURE. THE LD. COUN SEL FOR THE ASSESSEE SUBMITTED THAT ALL ADDITIONS ARE, THER EFORE, LIABLE TO BE DELETED AND THE SAME ARE ALSO COVERED BY THE SURRENDERED AMOUNT OF RS. 40 LACS AND IN ALTERNATE 15 CONTENTION, SUBMITTED THAT IF ALL THE ADDITIONS ARE MAINTAINED, IT WOULD GIVE GP RATE OF 9.93% WHICH IS HIGHLY UNREASONABLE, EXCESSIVE AND EXORBITANT AND AGAINST THE HISTORY OF THE ASSESSEE. HE HAS GIVEN COMPARATIVE CHART OF GP AND NP FOR PRECEDING YEAR S ALES WHICH IS REPRODUCED AS UNDER : JAIN RICE MILL COMPARATIVE GROSS PROFIT RATE & N ET PROFIT RATE FOR THE IMPUGNED YEAR, 3 PRE CEDING YEAR & 1 SUCCEEDING YEAR 16. THE LD. COUNSEL FOR THE ASSESSEE, THEREFORE, SUBMITTED THAT EVEN IF SOME ADDITION IS LIABLE TO B E MADE WHEN BOOKS OF ACCOUNT HAVE BEEN REJECTED, SLIG HTLY HIGHER GP RATE MAY BE APPLIED FOR THE PURPOSE OF MA KING THE ADDITION. ON THE OTHER HAND, LD. DR RELIED UPO N ORDERS OF THE AUTHORITIES BELOW. 17. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IT IS NOT IN DISPUT E THAT ASSESSEE MADE SURRENDER OF RS. 40 LACS DURING THE COURSE OF SURVEY TO COVER UP ALL DISCREPANCIES IN T HE A.Y. SALES PURCHASES GROSS PROFIT G.P. RATE NET PROFIT N.P. RATE CLOSING STOCK 2004-05 78368611.52 70296982.37 4705096.26 6.00% 38282,97 0.05% 22932803.50 2005-06 72368611.52 58696866.86 47316640.19 6.49% 43855.17 0.06% 17848850.00 2006-07 91059991.44 94969012.21 5436860.93 5.97% 32675.49 0.04% 31135547.25 .2007 -08 (IMPUGNED YEAR 98219163.58 67905865.56 1597013.77 1.63% 77313.75 0.08% 9801905.00 2008-09 971614480.00 74916930.33 6651604.62 5.36% 66268.34 0.07% 25200998.00 16 BOOKS OF ACCOUNT, LOOSE PAPERS, DOCUMENTS, STOCK, B Y- PRODUCTS AND OTHER RECORDS. THE ASSESSEE ALSO SURRENDERED THE SAME AMOUNT IN PROFIT & LOSS ACCOUN T AS MISCELLANEOUS INCOME FOR THE PURPOSE OF TAXATION . THE LD. COUNSEL FOR THE ASSESSEE FROM THE PAPER BOO K-2 POINTED OUT THAT THE OPENING STOCK OF SUPERFINE PAD DY IS VALUED AT RS. 650/- PER QUINTAL AND PURCHASES HAVE ALSO BEEN @ RS. 665/- PER QTL. THEREFORE, AVERAGE RATE OF THE PURCHASES COMES TO RS. 650/- TO RS. 665/- PER QUINT AL AND AVERAGE SELLING RATE WAS ALSO RS. 511/- PER QUI NTAL. THESE DOCUMENTS FILED IN THE BOOKS OF ACCOUNT HAVE NOT BEEN DISPUTED BY THE LD. DR THROUGH ANY MATERIAL ON RECORD, THEREFORE, RATES GIVEN BY THE ASSESSING OFF ICER IN THE ASSESSMENT ORDER OF SALE AND PURCHASE OF SUPERF INE PADDY WOULD BE INCORRECT. FURTHER, THE ASSESSING OF FICER REFERRED TO DOCUMENT D-1 AND D-2 WHICH WERE IMPOUNDED DURING THE COURSE OF SURVEY AND FOUND THA T THERE WERE UNDISCLOSED CASH RECEIVED, THEREFORE, PE AK OF THE CREDIT OF THE ENTRIES RECORDED IN THESE DOCUMEN TS WERE ADDED IN A SUM OF RS. 6,03,692/-, HOWEVER IT W AS DELETED BY LD. CIT(APPEALS) BECAUSE THE SAME WOULD BE COVERED BY THE SURRENDERED AMOUNT ( THE ASSESSING OFFICER IN THE COMPUTATION TOOK THIS FIGURE AT RS. 6,05,090/-). THE ASSESSEE ALSO EXPLAINED THAT THE PRICE OF THE SUPERFINE PADDY DEPENDS UPON YIELD, PERISHAB LE ITEM IN NATURE AND ITS PROCESS AND SINCE PADDY CANN OT BE HELD FOR A LONG TIME THEREFORE, RATES WOULD DEPE ND ON THE SAME AT THE TIME OF SALE OR PURCHASE. THE 17 ASSESSEE ALSO FILED STUDY BY RICE KNOWLEDGE BANK IN SUPPORT OF THE SAME. THE ASSESSEE MAINTAINED BOOKS OF ACCOUNT AND CONFIRMATION OF THE PARTIES WERE FILED. PAYMENTS ARE STATED TO BE MADE THROUGH BANKING CHANNEL AND STOCK HAVE BEEN MAINTAINED AT THE SAME RATE. THE DISPATCH OF THE GOODS AND PURCHASES BY T HE PARTIES HAVE NOT BEEN DISPUTED. THEREFORE, THESE F ACTS WOULD SHOW THAT THE SURVEY PARTY WAS SATISFIED WITH THE SURRENDER OF RS.40 LACS ON ACCOUNT OF DISCREPANCIES IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. THEREFORE, N O FURTHER ADDITIONS SHOULD HAVE BEEN MADE AGAINST THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE FURTHER EXPLAINED THAT ON ACCOUNT OF HUGE SUNDRY CREDITS APPEARING IN THE BOOKS OF ACCOUNT OF THE ASSESSEE I N PRECEDING ASSESSMENT YEAR, ASSESSEE SOLD THE SUPERF INE PADDY AT A LOWER RATE TO CLEAR THE DEBTS. THIS FAC T IS CLEARLY PROVED FROM THE LIST OF THE SUNDRY CREDITOR S OF EARLIER YEARS AND IN ASSESSMENT YEAR UNDER APPEAL. THEREFORE, EXPLANATION OF THE ASSESSEE IS ACCEPTED THAT PADDY WAS SOLD AT SLIGHTLY LOWER RATE BECAUSE OF TH E BUSINESS EXIGENCIES. THE LD. COUNSEL FOR THE ASSES SEE ALSO FILED A CHART IN THE PAPER BOOK TO SHOW THAT R ATE OF THE PURCHASES OF SUPERFINE PADDY BEFORE AND AFTER SURVEY WAS AT THE SAME RATE. THEREFORE, EXPLANATIO N OF THE ASSESSEE SHOULD HAVE BEEN CONSIDERED IN PROPER PERSPECTIVE AND HUGE ADDITIONS SHOULD NOT BE MADE AGAINST THE ASSESSEE. 18 17(I) FURTHER, AS REGARDS RICE BRAN SOLD BY ASSESSE E, THE ASSESSING OFFICER CONSIDERING THE COMPARABLE CASES IN THE CASE OF M/S GARG RICE MILLS, M/S AGGARWAL RICE MILLS AND M/S SHIV GANESH INDUSTRIES, ADOPTED THE REASONABLE RATE OF RS. 660/- PER QUINTAL FOR THE PU RPOSE OF MAKING ADDITION AGAINST THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE, HOWEVER, RELIED UPON DECI SION OF THE ITAT CHANDIGARH BENCH IN THE CASE OF SHAKTI RICE & GENERAL MILLS (SUPRA) IN WHICH THE AUTHORITIES BE LOW HAVE CONSIDERED ONE OF THE SIMILAR CASE, IN THE CAS E OF M/S SHIV GANESH INDUSTRIES, SHAHBAD AND LD. CIT(APPEALS) DIRECTED TO ADOPT THE REASONABLE RATE OF RS. 450/- PER QUINTAL ON SALE OF RICE BRAN WHICH HAVE B EEN CONFIRMED BY THE TRIBUNAL BY DISMISSING CROSS APPEA LS. THEREFORE, ON THAT ACCOUNT ALSO, IT IS CLEAR THAT ASSESSING OFFICER HAS ADOPTED VERY HIGHER FIGURE OF SALE OF RICE BRAN. THEREFORE, THIS ADDITION IS ALSO LIA BLE TO BE DELETED SUBSTANTIALLY. 18. WE MAY ALSO NOTE HERE THAT ASSESSEE HAS FILED COMPARATIVE CHART OF GP AND NP OF ASSESSMENT YEAR UNDER APPEAL AS WELL AS OF PRECEDING AND SUBSEQUENT YEARS TO SHOW THAT NP RATE IS HIGHER AS COMPARED TO EARLIER YEARS BUT THERE IS HUGE FALL IN GP RATE. W HEN BOOKS OF ACCOUNT HAVE BEEN REJECTED BY THE AUTHORIT IES BELOW THEREFORE, INSTEAD OF MAKING HUGE ADDITIONS O F RS. 44,28,447/- AND RS. 33,00,029/-, IT WOULD HAVE BEEN REASONABLE AND APPROPRIATE FOR THE AUTHORITIES BELO W TO 19 COMPUTE THE INCOME OF THE ASSESSEE REASONABLY CONSIDERING HISTORY OF THE ASSESSEE. THEREFORE, IN OUR VIEW, IT WOULD HAVE BEEN BETTER FOR THE AUTHORITIES BELOW TO APPLY HIGHER GP RATE TO COMPUTE REASONABLE INCOM E OF THE ASSESSEE INSTEAD OF MAKING HUGE ADDITIONS AGAIN ST THE ASSESSEE, PARTICULARLY IN VIEW OF THE FACT THAT THE EXPLANATION OF THE ASSESSEE, AS NOTED ABOVE, CLEARL Y SHOW THAT THE ADDITIONS ON ACCOUNT OF SUPERFINE PAD DY AND RICE BRAN WERE NOT WHOLLY JUSTIFIED. WHEN ALL THESE ADDITIONS ARE TAKEN INTO CONSIDERATION, IT WOULD GI VE THE PROFIT RATE OF 9.93% AS EXPLAINED BY ASSESSEE WHICH WOULD BE TOTALLY UNJUSTIFIED CONSIDERING HISTORY OF THE ASSESSEE. THE EXPLANATION GIVEN BY THE ASSESSEE CL EARLY SHOW THAT BOTH THESE ADDITIONS WERE WHOLLY INAPPROPRIATE AND WERE UNJUSTIFIED BECAUSE RATES GI VEN BY THE AUTHORITIES BELOW WERE TOTALLY DIFFERENT AND UNREASONABLE. 19. CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES AND HISTORY OF THE ASSESSEE, WE ARE O F THE VIEW THAT INSTEAD OF MAKING ADDITION OF RS. 44,28,4 47/- AND RS. 33,00,029/-, IT WOULD BE APPROPRIATE THAT WHEN BOOKS OF ACCOUNT HAVE BEEN REJECTED, THE AUTHORITIE S BELOW SHOULD APPLY SLIGHTLY HIGHER GP RATE FOR THE PURPOSE OF COMPUTING INCOME OF THE ASSESSEE IN ORDE R TO MEET THE ENDS OF JUSTICE. WE, ACCORDINGLY, SET ASI DE AND MODIFY THE ORDERS OF AUTHORITIES BELOW DELETING THE ABOVE ADDITIONS AND DIRECT THE ASSESSING OFFICER TO 20 ADOPT GP RATE OF 3% AGAINST THE SALES DECLARED BY T HE ASSESSEE AND COMPUTE THE INCOME OF THE ASSESSEE ACCORDINGLY. THESE GROUNDS ARE, THEREFORE, PARTLY ALLOWED. 19(I) AS REGARDS ADDITION MADE OF RS. 1,98,020/- UNDER SECTION 40A(2) OF THE ACT, ASSESSING OFFICER HAS NO T CITED ANY COMPARABLE CASE FOR THE PURPOSE OF MAKING ADDIT ION AND FURTHER ADDITION OF RS. 1,47,478/- ON ACCOUNT O F 10% DISALLOWANCE OUT OF WAGES EXPENSES IS ALSO WHOL LY INAPPROPRIATE BECAUSE THE ASSESSEE HAS ALREADY MADE SURRENDER OF RS. 40 LACS. WE MAY ALSO NOTE HERE TH AT WHEN WE HAVE DIRECTED THE AUTHORITIES BELOW TO APPL Y PROFIT RATE OF 3% FOR THE PURPOSE OF COMPUTING INCO ME OF ASSESSEE AFTER REJECTION OF THE BOOKS OF ACCOUNT, T HESE ADDITIONS WOULD NOT BE WARRANTED BECAUSE THE APPLICATION OF HIGHER GP WOULD TAKE CARE OF THE SAM E. WE RELY UPON DECISION OF THE ALLAHABAD HIGH COURT I N THE CASE OF BANWARI LAL BANSHIDHAR 229 ITR 229 IN WHICH IT WAS HELD THAT WHEN GP RATE IS APPLIED, IT WOULD TAKE CARE OF OTHER DISALLOWANCE OF EXPENSES. WE, ACCORDINGLY, SET ASIDE THE ORDERS OF AUTHORITIE S BELOW AND DELETE THE ADDITION OF RS. 1,98,202/- AND RS. 1,47,478/-. THESE GROUNDS OF APPEAL OF THE ASSESSE E ARE ACCORDINGLY, ALLOWED. 19(II) AS REGARDS THE ADDITION MADE ON ACCOUNT OF BAD DEBTS OF RS. 7,75,001/-, THE AUTHORITIES BELOW NOTED THAT ASSESSEE HAS INCURRED BAD DEBTS IN RESPECT OF M/S 21 P.LAL TRADERS RS. 2,28,333/-, M/S RATNA RICE INDUST RIES RS.3,42,898/- AND M/S SOHAL RICE MILLS RS.2,03,770/ -. THE AUTHORITIES BELOW NOTED THAT ASSESSEE HAS NOT PROVED THAT WHAT EFFORTS HAVE BEEN MADE FOR RECOVER Y OF THESE BAD DEBTS. FURTHER, AS PER INFORMATION RECEI VED BY ASSESSING OFFICER, THERE WERE NO SUCH BALANCES APPEARING IN THEIR CASES. AFTER AMENDMENT IN SECTI ON 36(1)(VII), THE ASSESSEE NEED NOT TO PROVE AS TO WH AT EFFORTS HAVE BEEN MADE FOR RECOVERY OF THE BAD DEBT S. MERE WRITE OFF OF THE BAD DEBTS AS IRRECOVERABLE IN THE ACCOUNTS OF THE ASSESSEE FOR THE PREVIOUS YEAR IS ENOUGH. WE RELY UPON DECISION OF THE HON'BLE SUPRE ME COURT IN THE CASE OF T.R.F.LTD. (SUPRA). THE LD. C OUNSEL FOR THE ASSESSEE ALSO REFERRED TO ASSESSMENT ORDER OF PRECEDING ASSESSMENT YEAR 2006-07 IN THE PAPER BOOK UNDER SECTION 143(3) IN WHICH ASSESSING OFFICER CONSIDERED THE SAME PARTIES HAVING SAME AMOUNT OUTSTANDING AGAINST THEM AND MADE DISALLOWANCE OF INTEREST @ 12%. THIS ADDITION WAS DELETED BY THE TRIBUNAL. THEREFORE, THERE IS NO QUESTION OF AUTHO RITIES BELOW IN NOTING THAT THERE IS NO SUCH BALANCE APPEA RING AS OUTSTANDING AGAINST THEM. THEREFORE, THERE WAS NO JUSTIFICATION TO MAKE THIS ADDITION. WE ACCORDINGL Y, SET ASIDE ORDERS OF AUTHORITIES BELOW AND DELETE THE AD DITION OF RS. 7,75,001/-. THIS GROUND OF APPEAL IS THEREF ORE, ALLOWED. 22 20. CONSIDERING ABOVE DISCUSSION, WE DELETE THE ADDITIONS ON GROUND NOS. 2, 3 AND 5 AND ON GROUND N O. 1(B) AND 4, ADDITIONS MADE BY AUTHORITIES BELOW ARE DELETED. HOWEVER, ASSESSING OFFICER IS DIRECTED TO COMPUTE INCOME ON THESE GROUNDS OF APPEAL BY APPLYI NG GP RATE OF 3% AS DIRECTED ABOVE. WE MAKE IT CLEAR THAT THE ULTIMATE INCOME COMPUTED BY THE ASSESSING OFFIC ER SHALL NOT BE LESS THAN THE SURRENDERED AMOUNT OF RS . 40 LACS DURING THE COURSE OF SURVEY. 21. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (RANO JAIN) (BHAVN ESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 31 ST MARCH,2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT,DR ASSISTANT REGISTRAR, ITAT/CHD