Balex Pvt.Ltd., Baroda V. The Dy.CIT.,Circle-1(1), Baroda

ITA 764/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1262 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 07-06-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 04-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Rejection of books of accounts; Business income; Revised return

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD .., , !' BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER 1. ./ I.T.A. NO.764/AHD/2012 2. ./ I.T.A. NO.765/AHD/2012 ( / ASSESSMENT YEARS : 2005-06 & 2006-07 RESPECTIVELY ) 1&2. BALEX PRIVATE LIMITED 30-31, NAVI JETHARDI KARJAN-SINOR ROAD BARODA 391 240 / VS. 1&2. THE DCIT CENTRAL CIRCLE-1 BARODA $ ./ ./ PAN/GIR NO. : AAACB 7665 B ( $' / APPELLANT ) .. ( ()$' / RESPONDENT ) $'* / APPELLANT BY : SHRI TUSHAR P. HEMANI, AR ()$'+* / RESPONDENT BY : SHRI K. MADHUSUDAN, SR.DR ,+ / DATE OF HEARING 07/06/2016 -./+ / DATE OF PRONOUNCEMENT 14/06/2016 / O R D E R PER SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER : BOTH THESE APPEALS BY THE ASSESSEE ARE DIRECTED A GAINST THE SEPARATE ORDERS OF THE COMMISSIONER OF INCOME TAX(A PPEALS)-I, BARODA IDENTICALLY DATED 13/01/2012 PASSED FOR ASSESSMEN T YEARS (AYS) 2005- 06 AND 2006-07. ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 2 - 2. FIRST WE TAKE UP ASSESSEES APPEAL IN ITA NO.764 /AHD/2012 FOR AY 2005-06. 2.1. THE RELEVANT FACTS AS CULLED OUT FROM THE MAT ERIALS ON RECORD ARE AS UNDER:- 2.2. ASSESSEE IS A COMPANY STATED TO BE ENGAGED I N THE BUSINESS OF MANUFACTURING OF ALUMINUUM SECTIONS. ASSESSEE FILE D ITS RETURN OF INCOME FOR AY 2005-06 ON 29/10/2005 DECLARING TOTAL LOSS OF RS.38,90,070/-. SUBSEQUENTLY, ASSESSEE FILED REVIS ED RETURN OF INCOME ON 31/10/2006 SHOWING TOTAL INCOME AT RS.NIL AS AGAINS T LOSS OF RS.38,90,070/-. CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMENT WAS FRAMED U/S.143(3) OF THE INCOME TAX ACT, 1961 ( HEREINAFTER REFERRED TO AS 'THE ACT') VIDE ORDER DATED 19/11/2007 AND TOTAL INCOME WAS DETERMINED AT RS.1,00,73,877/- BEFORE SET OFF OF B ROUGHT FORWARD LOSS. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER(AO) , ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A), WHO VIDE ORDER DAT ED 13/01/2012 (IN APPEAL NO.CAB-I/150/07-08 ) GRANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NO W IN APPEAL BEFORE US AND HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 1. THE CIT(APPEALS) ERRED IN UPHOLDING THE CONTENT ION OF LD.AO OF ALLEGED NON-ATTENDANCE AND NON-COOPERATION FROM ASSESSEE. 2. THE CIT(APPEALS) ERRED IN UPHOLDING ADDITION T O THE TUNE OF RS.33,35,000/- U/S.68 OF THE ACT IN RESPECT OF LOAN TAKEN FROM SHANTI METALS PVT.LTD. ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 3 - 3. THE CIT(APPEALS) ERRED IN UPHOLDING ACTION OF LD.AO IN REJECTION OF BOOKS OF ACCOUNTS. 4. THE CIT(APPEALS) ERRED IN UPHOLDING ACTION OF LD .AO IN ESTIMATING NET PROFIT AT RS.6,05,998/-, BEING 1% OF SALES. 3. FIRST (SECOND GROUND OF APPEAL) GROUND IS WITH R ESPECT TO ADDITION OF RS.33,35,000/- MADE U/S. 68 OF THE ACT. 3.1. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, A O NOTICED THAT ASSESSEE HAS ACCEPTED LOANS AGGREGATING TO RS.93,95 ,000/- FROM FIVE PARTIES (THE LIST IS REPRODUCED AT PAGE NOS.3&4 OF THE ASSESSMENT ORDER). IN RESPECT OF THOSE PARTIES, THE ASSESSEE WAS ASKED TO FURNISH CONFIRMATION LETTERS, NAMES AND ADDRESSES OF DEPOSITORS, NAME AN D ADDRESS OF THE BANK, COPY OF THE ACKNOWLEDGEMENT RETURN AND OTHER DETAIL S SO AS TO PROVE THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE T RANSACTIONS. THE AO NOTED THAT THE ASSESSEE DID NOT FURNISH THE DETAILS CALLED FOR BY THE AO. HE THEREFORE HELD THAT ASSESSEE HAS NOT DISCHARGED THE ONUS OF PROVING THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF T HE TRANSACTIONS AND, ACCORDINGLY, HE CONSIDERED THE AGGREGATE AMOUNT OF RS.93,95,000/- AS UNEXPLAINED CASH CREDIT U/S68 OF THE ACT. AGGRIEVE D BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A), W HO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, THE REMAND REPORT AND ASSESSEES REPLY TO REMAND REPORT, GRANTED PARTIAL RELIEF BY DELETING T HE ADDITION TO THE EXTENT OF RS.60,60,000/- BUT HOWEVER CONFIRMED THE ADDITIO N OF RS.33,35,000/- RECEIVED BY ASSESSEE FROM SHANTI METALS PVT.LTD. BY HOLDING AS UNDER:- ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 4 - 3.2. I HAVE CONSIDERED FACTS OF THE CASE AND APPEL LANTS SUBMISSIONS. ASSESSING OFFICER, ON VERIFICATION HAS FOUND APPELL ANTS CONTENTION ABOUT LOANS FROM FOUR PARTIES NAMELY, ASHISH APPARE LS PVT.LTD. WHITE METALS PVT.LTD., GOYAL FINCAP PVT.LTD. AND DEVENDRA KUMAR GUPTA (HUF) TOTALLING TO RS.40,60,000/-, BEING BROUGHT FO RWARD FROM EARLIER YEARS TO BE CORRECT. LOANS BROUGHT FORWARD FROM EA RLIER YEARS CANNOT BE ADDED U/S.68 IN A.Y. 2005-06. IN RESPECT OF LOA N OF RS.20,00,000/- FROM EASTERN JEWEL PVT.LTD., IT IS SEEN THAT THERE ARE TWO CREDIT ENTRIES OF RS.10,00,000/- EACH BY TWO STATED CHEQUES (I.E. THE SAME CHEQUE NUMBERS) IN APPELLANTS BANK ACCOUNT WITH CITIBANK ON 13.10.2004. ADDITION U/S.68 OF RS.20,00,000/- IN RESPECT OF LOA N FROM EASTERN JEWEL PVT.LTD. IS THEREFORE TO BE DELETED. REGARDING LOA N FROM SHANTI METALS PVT.LTD., IT IS SEEN FROM THE BALANCE SHEET OF THE PARTY THAT APPELLANTS NAME DOES NOT FIGURE IN SCHEDULE I (LOANS & ADVANC ES) TOTALLING TO RS.13,51,958/- IN THE BALANCE SHEET AS ON 31.3.2005 . AUTHORISED REPRESENTATIVE DREW ATTENTION TO APPELLANTS NAME A PPEARING IN SCHEDULE G, I.E. SUNDRY DEBTORS FOR RS.90,94,664/ -. HOWEVER, HE COULD NOT EXPLAIN AS TO HOW LOANS RECEIVED WOULD BE REFLE CTED AS SUNDRY DEBTORS IN BALANCE SHEET OF PARTY. FURTHER, IT IS A FACT THAT THE RETURNED INCOME OF SHANTI METALS PVT.LTD. WAS RS.26,490/- ON LY IN A.Y. 2005-06 AND DESPITE AOS SPECIFIC REQUISITION, COPY OF BANK STATEMENT OF SHANTI METALS PVT.LTD. SHOWING SOURCE OF RS.33,35,000/- IS NOT FILED. CREDITWORTHINESS OF THIS PARTY IS THEREFORE NOT EST ABLISHED AND ADDITION U/S.68 IN RESPECT OF LOAN FROM THIS PARTY IS JUSTIF IED. TO SUM UP, ADDITION OF RS.60,60,000/- IS DELETED AND ADDITION OF RS.33, 35,000/- IS CONFIRMED. 3.2. AGGRIEVED BY THE ORDER OF THE LD.CIT(A), A SSESSEE IS NOW IN APPEAL BEFORE US. 3.3. BEFORE US, LD.AR REITERATED THE SUBMISSIONS MA DE BEFORE THE AO AND LD.CIT(A) AND FURTHER SUBMITTED THAT AND ADDITI ON TO THE EXTENT OF RS.33,35,000/- IN RESPECT OF FUNDS RECEIVED FROM SH ANTI METALS PVT.LTD. ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 5 - WAS CONFIRMED BY THE LD.CIT(A). HE SUBMITTED THAT ASSESSEE HAS FURNISHED THE COPY OF ACKNOWLEDGEMENT OF INCOME-TAX RETURN, CONFIRMATION AND THE ANNUAL REPORT OF SHANTI METALS PVT.LTD. AND HAS THUS PROVED THE IDENTITY, GENUINENESS OF TRANSACTIONS AN D THE CREDITWORTHINESS OF THE PARTIES. HE SUBMITTED THAT THE LD.CIT(A) DI D NOT ACCEPT THE AFORESAID SUBMISSION OF THE ASSESSEE MERELY BECAUSE SHANTI METALS PVT.LTD. HAD REFLECTED THE AMOUNT UNDER THE HEAD S UNDRY DEBTORS. HE SUBMITTED THAT IT IS A PREROGATIVE OF SHANTI METALS PVT.LTD. TO REFLECT THE TRANSACTION IN THE WAY THEY WISH IN ITS BOOKS OF AC COUNT AND ON WHICH ASSESSEE DOES NOT HAVE ANY CONTROL. HE FURTHER SUB MITTED THAT THE OTHER REASON FOR CONFIRMATION OF ADDITION BY CIT(A) WAS N ON-FURNISHING OF THE BANK STATEMENT OF SHANTI METALS PVT.LTD. HE SUBMIT TED THAT WHEN ASSESSEE HAS FURNISHED THE CONFIRMATION, THE RETURN OF INCOME, BALANCE- SHEET AND PROFIT & LOSS ACCOUNT, IT HAS DISCHARGED THE ONUS CAST UPON BY THE ASSESSEE AS REQUIRED U/S.68 OF THE ACT. HE FUR THER SUBMITTED THAT TRANSACTIONS WITH SHANTI METALS PVT.LTD. ARE GENUIN E TRANSACTIONS AND IF GIVEN AN OPPORTUNITY, THE ASSESSEE WILL PRODUCE SHA NTI METALS PVT.LTD. BEFORE THE AO AND ALSO FURNISH THE NECESSARY EVID ENCES AS REQUIRED BY THE AUTHORITIES TO DISCHARGE THE ONUS CAST UPON THE ASSESSEE AS REQUIRED U/S.68 OF THE ACT. HE THEREFORE SUBMITTED THAT ONE MORE OPPORTUNITY BE GRANTED TO THE ASSESSEE TO PRODUCE THE REQUIRED BOO KS OF ACCOUNT AND OTHER DETAILS SO AS TO ESTABLISH THE GENUINENESS OF TRANSACTIONS. AS FAR AS THE GROUND OF APPEAL IN ASSESSEES APPEAL FOR AY 20 06-07 IS CONCERNED, ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 6 - HE SUBMITTED THAT SINCE THE LOAN FROM SHANTI METALS PVT.LTD. WAS CONSIDERED AS UNEXPLAINED CASH CREDIT, THE INTEREST PAID BY THE ASSESSEE ON THE LOAN WAS ALSO DISALLOWED. THE SR.DR, ON TH E OTHER HAND, SUPPORTED THE ORDER OF AO AND LD.CIT(A) AND FURTHER SUBMITTED THAT DESPITE VARIOUS OPPORTUNITIES GRANTED BY THE AO , T HE ASSESSEE DID NOT DISCHARGE THE ONUS CAST UPON THE ASSESSEE TO PROVE THE CASH CREDIT FROM SHANTI METALS PVT.LTD. AND IN SUCH A SITUATION, AO WAS JUSTIFIED IN MAKING THE ADDITION AND ALSO THE INTEREST EXPENSES CLAIMED IN AY 2006- 07. HE THUS SUPPORTED THE ORDER OF THE LD.CIT(A). 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO TH E ADDITION MADE U/S.68 OF THE ACT OF THE AMOUNT OF RS.33,35,000/- RECEIV ED BY THE ASSESSEE FROM SHANTI METALS PVT.LTD. WE FIND THAT LD.CIT(A) WHILE CONFIRMING THE ADDITION HAS INTER ALIA NOTED THAT THOUGH ASSES SEE HAS STATED THE AMOUNT RECEIVED FROM SHANTI METAL PVT.LTD. AS LOAN BUT ON THE OTHER HAND, SHANTI METALS PVT.LTD. HAS REFLECTED THE AMOU NT DUE FROM ASSESSEE AS SUNDRY DEBTORS, ASSESSEE HAD NOT FILED THE COP Y OF BANK STATEMENT OF SHANTI METALS PVT.LTD. SHOWING SOURCE OF RS.33,35,0 00/-. ON THE OTHER HAND, BEFORE US, IT IS ASSESSEES SUBMISSION THAT T HE ASSESSEE HAD FURNISHED THE DETAILS TO PROVE THE GENUINENESS OF T RANSACTION AND IF GIVEN ONE MORE OPPORTUNITY, THE ASSESSEE WOULD PRESENT SH ANTI METALS PVT.LTD. ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 7 - BEFORE THE AO AND ALSO FURNISH ALL THE OTHER NECESS ARY DETAILS REQUIRED AND ALSO PROVE THAT THE TRANSACTIONS WITH SHANTI M ETALS PVT.LTD. WAS GENUINE AND THEREFORE NO ADDITION U/S.68 WAS REQUIR ED. CONSIDERING THE AFORESAID REQUEST OF THE ASSESSEES LD.AR, IN THE I NTEREST OF JUSTICE, WE ARE OF THE VIEW THAT THE ASSESSEE BE GRANTED ONE MORE O PPORTUNITY TO PROVE THE TRANSACTIONS. WE THEREFORE RESTORE THE ISSUE B ACK TO THE FILE OF AO TO DECIDE AFRESH THE ISSUE OF ADDITION U/S.68 OF THE ACT WITH RESPECT TO THE AMOUNT RECEIVED FROM SHANTI METALS PVT.LTD. NEEDLE SS TO STATE THAT THE AO SHALL GRANT ADEQUATE OPPORTUNITY OF HEARING TO T HE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO COOPERATE BY PROMPTLY FURNISHING ALL THE REQUIRED DETAILS AND INFORMATION CALLED FOR BY THE AO AND ENSURE THE PRESENCE OF THE LENDER THROUGH ITS AUTHORIZED REPRE SENTATIVE BEFORE AO. IN CASE, THE ASSESSEE FAILS TO FURNISH THE REQUIRED DETAILS AS CALLED FOR BY THE AO, AO WOULD BE AT LIBERTY TO DECIDE THE ISSUE IN ACCORDANCE WITH LAW AND ON THE BASIS OF MATERIAL AVAILABLE ON RECOR D. SINCE THE ISSUE OF QUANTUM ADDITION IS SET ASIDE, THE GROUND OF ASSES SEE IN AY 2006-07 IN ITA NO.765/AHD/2012 (BEING THE INTEREST ON LOAN TO SHANTI METALS PVT.LTD.) BEING CONNECTED TO THE GROUND RAISED BY ASSESSEE IN AY 2005- 06, THE SAME IS ALSO SET ASIDE TO THE FILE OF AO TO DECIDE IT AFRESH. THUS, THIS GROUND IN AYS 2005-06 & 2006-07 ARE ALLOWED FO R STATISTICAL PURPOSES. 5. NEXT GROUND IN ASSESSEES APPEAL IN ITA NO.764/A HD/2012 FOR AY 2005-06 IS WITH RESPECT TO ESTIMATING NET PROFIT . ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 8 - 5.1. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, A O NOTICED THAT THE ASSESSEE HAD FILED RETURN OF INCOME ON 29/10/2005 C LAIMING BUSINESS LOSS OF RS.38,90,070/-. THE CASE OF ASSESSEE WAS SELECT ED FOR SCRUTINY ASSESSMENT AND NOTICE U/S.143(2) OF THE ACT WAS ISS UED ON 10/10/2006. THEREAFTER, THE ASSESSEE FILED A REVISED RETURN OF INCOME ON 31/10/2006 SHOWING THE TOTAL INCOME AT RS.NIL AS AGAINST THE L OSS OF RS.38,90,070/- CLAIMED IN THE ORIGINAL RETURN OF INCOME. THE AO N OTED THAT THE ASSESSEE DID NOT PRODUCE THE BOOKS OF ACCOUNT AND VOUCHERS F OR VERIFICATION NOR FURNISHED DETAILED WORKING OF INVENTORIES, THEREBY DEPRIVING THE AO TO VERIFY THE CORRECTNESS OF THE FIGURES. AO ALSO NOT ED THAT THE OTHER DETAILS CALLED FOR BY THE AO WITH RESPECT TO THE INTEREST P AYMENT TO PERSONS SPECIFIED U/S.40A(2)(B) WERE NOT FURNISHED BY THE A SSESSEE. HE THEREFORE CONCLUDED THAT THE BOOKS OF ACCOUNTS WERE NOT CORRE CT AND COMPLETE AND AFTER REJECTING THE BOOKS OF ACCOUNTS U/S.145(3) OF THE ACT, ESTIMATED NET PROFIT ON 1% OF THE TOTAL SALES AND THEREBY MADE A DDITION OF RS.6,05,998/-. AGGRIEVED BY THE ORDER OF THE ADDIT ION MADE BY THE AO, ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A), WHO UPHELD THE ORDER OF THE AO BY HOLDING AS UNDER:- 4.2. I HAVE CONSIDERED FACTS OF THE CASE AND APPEL LANTS SUBMISSIONS. IN THE SUBMISSIONS MADE DURING APPEAL, APPELLANT HAS REFER RED TO DETAILS FURNISHED BY IT; HOWEVER, APPELLANT IS SILENT ABOUT VARIOUS D ETAILS CALLED FOR BY THE ASSESSING OFFICER, WHICH WERE FURNISHED NEITHER DUR ING ASSESSMENT PROCEEDINGS NOR EVEN DURING APPELLANT PROCEEDINGS. SUCH DETAILS INCLUDE DETAILS OF SALES AND PURCHASES WITH ADDRESSES OF PA RTIES, DETAILS OF ASSETS PURCHASED WITH BILLS, DETAILS OF EXPENSES, JUSTIFIC ATION IN RESPECT OF PAYMENTS COVERED U/S.40A(2) ETC. APPELLANT HAS ALSO NOT EXP LAINED THE BASIS FOR ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 9 - REVISING THE RETURNED INCOME TO NIL FROM RETURNED L OSS OF RS.38,90,070/- AFTER SELECTION OF CASE FOR BY THE ASSESSING OFFICER, IT WAS NOT POSSIBLE FOR THE A.O. TO VERIFY WHETHER BOOKS OF ACCOUNTS WERE CORRECT OR COMPLETE AND WHETHER THE INCOME RETURNED WAS CORRECTLY COMPUTED. ASSESSING WAS THEREFORE JUSTIFIED IN INVOKING PROVISIONS OF SECTION 145(3). AS FAR AS A PPELLANTS CONTENTION REGARDING THERE BEING NO BASIS OF ADDITION IS CONCE RNED, QUANTUM WISE, ADDITION MADE @ 1% OF TOTAL SALES, I.E. RS.6,05,998 /- IS REASONABLE IN THE FACTS AND CIRCUMSTANCES OF THE CASE. IN A SITUATION LIKE THIS, ASSESSING OFFICER HAD NO OPTION BUT TO MAKE ADDITION ON ESTIMATED BASIS O NLY. ADDITION OF RS.6,05,998/- IS CONFIRMED. 5.2. AGGRIEVED BY THE ORDER OF THE LD.CIT(A), ASSES SEE IS NOW IN APPEAL BEFORE US. 5.3. BEFORE US, LD.AR REITERATED THE SUBMISSIONS MA DE BEFORE THE AO AND LD.CIT(A) AND FURTHER SUBMITTED THAT ASSESSEE H AD INDEED PRODUCED THE BOOKS OF ACCOUNT AND OTHER DETAILS CALLED FOR B Y THE AO AND IN SUPPORT OF WHICH HE POINTED OUT TO PAGE NOS.54 BEIN G THE LETTER ADDRESSED TO AO DATED 16/11/2007. HE SUBMITTED THAT THE AO H AD OVERLOOKED THE DETAILS FURNISHED AND PROCEEDED TO ESTIMATE THE NET PROFIT BY REJECTING THE BOOKS OF ACCOUNT. HE SUBMITTED THAT THE BOOKS OF A CCOUNT OF ASSESSEE ARE AUDITED AND IN SUCH A SITUATION, THE REJECTION OF B OOKS OF ACCOUNT ARBITRARILY IS NOT TENABLE IN THE EYES OF LAW. HE THEREFORE SUBMITTED THAT THE ADDITION BE DELETED. IN THE ALTERNATE, HE SUBM ITTED THAT THE NET PROFIT ON 1% OF SALES IS AT HIGHER SIDE AND SOME REASONABL E ESTIMATE MAY BE MADE. LD.SR.DR, ON THE OTHER HAND, SUPPORTED THE O RDERS OF AO AND LD.CIT(A). ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 10 - 5.3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESP ECT TO REJECTION OF BOOKS OF ACCOUNT BY THE AO ON THE GROUND OF ALLEGED NON- PRODUCTION OF THE BOOKS OF ACCOUNT BEFORE THE AO. IT IS ASSESSEES CONTENTION THAT IT HAD PRODUCED THE BOOKS OF ACCOUNT BEFORE AO AND OTHER R EQUIRED VOUCHERS. ON THE OTHER HAND, IT IS AOS CONTENTION THAT THE R EQUIRED DETAILS WERE NOT FURNISHED BY THE ASSESSEE. LD.CIT(A) WHILE UPHOLDI NG THE ACTION OF AO HAS INTER ALIA NOTED THAT DETAILS CALLED FOR BY AO WERE NEITHER FURNISHED BEFORE AO NOR DURING APPELLATE PROCEEDINGS AND FURT HER ASSESSEE HAD ALSO NOT EXPLAINED THE BASIS FOR REVISING THE RETURNED I NCOME TO NIL AS AGAINST RETURNED LOSS OF RS.38,90,070/- AFTER SELECTION OF THE CASE FOR SCRUTINY AND ISSUANCE OF NOTICE U/S.143(2) OF THE ACT. IN VIEW OF THE CONTRARY SUBMISSIONS BY THE ASSESSEE AND THE AO, WE ARE OF T HE VIEW THAT ONE MORE OPPORTUNITY BE GRANTED TO THE ASSESSEE TO PROD UCE THE ENTIRE BOOKS OF ACCOUNT, VOUCHERS, AND SUCH OTHER DETAILS REQUIR ED BY THE AO, MORE SO WHEN THE GROUND NO.1 WITH RESPECT TO UNEXPLAINED CA SH CREDIT IS ALSO REMITTED BACK TO THE FILE OF AO. WE THEREFORE REST ORE THE PRESENT GROUND OF ASSESSEE TO AO WITH A DIRECTION TO THE ASSESSEE TO CO-OPERATE WITH AO BY PROMPTLY FURNISHING ALL THE REQUIRED DETAILS CAL LED FOR BY THE AO INCLUDING THE BOOKS OF ACCOUNT, VOUCHERS, THE VALUA TION OF INVENTORIES AND SUCH OTHER DETAILS AS CALLED FOR BY HIM. THE AO SHALL THEREAFTER DECIDE THE ISSUE DE NOVO . IN CASE, THE ASSESSEE FAILS TO FURNISH THE REQUIRED INFORMATION/DETAILS, AO SHALL BE FREE TO D ECIDE THE ISSUE ON THE ITA NOS.764 AND 765/AHD/2012 BALEX PRIVATE LIMITED VS. DCIT AYS 2005-06 & 2006-07 RESPECTIVELY - 11 - BASIS OF MATERIAL AVAILABLE ON RECORD. THUS, THIS GROUND OF ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, ASSESSEES APPEALS FOR ASSESSMENT YEARS 2005-06 AND 2006-07 ARE ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 14 /06 /2016 SD/- SD/- .. () () ( R.P. TOLANI) ( ANIL CHATURVEDI ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 14 / 06 /2016 3..,.../ T.C. NAIR, SR. PS !'#$%$' / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ()$' / THE RESPONDENT. 3. 456 7 / CONCERNED CIT 4. 7 ( ) / THE CIT(A)-I, BARODA 5. 89:(56 , 56/ , 4 / DR, ITAT, AHMEDABAD 6. :<=, / GUARD FILE. / BY ORDER, )8( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 8.6.16(DICTATION-PAD 21 PAGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 10.6.16/13.6.16 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.14.6.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 14.6.16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER