ITO, Kota V. BABU LAL SOMANI, Kota

ITA 931/JPR/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2053 (ITAT-JAIPUR)
• Duration Of Justice: 3 year(s) 9 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2017
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 29-11-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AJAY CHANDRA CIT DH LS
• Keywords: Rejection of books of accounts; Unexplained expenditure; Business income; Income from undisclosed sources; Loose papers; Period of limitation; Source of fund; Block assessment; Time period of passing order
• Section: 69C; 40A(3); 143(3); 133A; 14A; 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS [KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI VIKRAM SINGH YAD AV, AM VK;DJ VIHY LA-@ ITA NO. 931/JP/13 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2009-10 THE ITO , WARD-2(1), KOTA. CUKE VS. SHRI BABU LAL S OMANI, PROP. M/S SOMANI & COMPANY AND SOMANI CARRIER, BUNDI ROAD, KOTA. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO.: ATBPS9231K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI AJAY CHANDRA (CIT) FU/KZKFJRHDH VKSJ LS@ ASSESSEE BY : NONE LQUOKBZ DH RKJH[K@ DATE OF HEARING : 04/08/2017 ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT: 18/09/2017. VKNS'K@ ORDER PER SHRI VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LD. CIT(A), KOTA DATED 30.09.2013 FOR A.Y. 2009-10. NONE APPEA RED ON BEHALF OF THE ASSESSEE. GIVEN THAT THE APPEAL WAS FILED ON 29.11. 2013, THEREAFTER IT WAS FIRST LISTED FOR HEARING ON 29.01.2014 AND SINCE TH EN, THE MATTER HAS COME UP FOR HEARING ON NUMEROUS OCCASIONS BUT NO HEARING HA S TAKEN PLACE, IT WAS DECIDED THAT NO USEFUL PURPOSE WOULD BE SERVED IN A DJOURNING THE MATTER ANY FURTHER. ACCORDINGLY, BASED ON MATERIAL AVAILABLE ON RECORD AND TAKEN INTO CONSIDERATION THE CONTENTIONS OF THE LD. DR, THE AP PEAL IS BEING DISPOSED OFF ON MERITS. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 2 2. BRIEFLY THE FACTS OF THE CASE ARE THAT SURVEY UN DER U/S 133A WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASSESSEE ON 01. 10.2008. GIVEN THE NATURE AND COMPLEXITY OF ACCOUNTS, LOOSE PAPERS AND INCRIM INATING DOCUMENTS FOUND DURING THE COURSE OF SURVEY, THE MATTER WAS REFERRE D FOR SPECIAL AUDIT U/S 142(2A) OF THE I.T. ACT. THE ASSESSMENT PROCEEDINGS WERE THEREAFTER COMPLETED BY PASSING AN ORDER UNDER SECTION 143(3) OF THE ACT WHEREIN AN ADDITION OF RS. 2,42,47,241/-WAS MADE BY THE ASSESS ING OFFICER UNDER VARIOUS HEADS AS AGAINST THE RETURN INCOME OF RS. 11,54,207 /- 3. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS GIVEN CERTAIN RELIEF TO THE ASS ESSEE AGAINST WHICH THE REVENUE IS IN APPEAL BEFORE US. 4. IN ITS APPEAL, THE REVENUE HAS TAKEN AS MANY AS 10 GROUNDS OF APPEAL. IN MOST OF THE GROUNDS, WE FIND THAT THE MATTER REL ATING TO REJECTION OF BOOKS OF ACCOUNTS, DETERMINATION OF SUPPRESSED TURNOVER, ESTIMATION OF PROFITS AND WHERE THE PROFITS ARE SO ESTIMATED, CAN THERE BE SE PARATE ADDITIONS MADE UNDER VARIOUS SPECIFIC HEADS HAVE BEEN TAKEN BY THE REVENUE. FOR THE SAKE OF DISCUSSIONS, WE HAVE TAKEN ALL THESE GROUNDS OF APPEAL TOGETHER. THEREAFTER, OTHER REMAINING GROUNDS HAVE BEEN ADJUD ICATED UPON. WHETHER THE BOOKS OF ACCOUNTS HAVE BEEN REJECTED 5. THE FIRST AND FOREMOST QUESTION THAT ARISES FOR CONSIDERATION IN ALL THESE GROUNDS OF APPEAL IS WHETHER THE BOOKS OF ACCOUNTS OF THE ASSESSEE HAVE BEEN REJECTED IN THE INSTANT CASE OR NOT. THE LD. CIT(A) HAS GIVEN A FINDING THAT IN SUBSTANCE THE AO NEVER RELIED ON THE BOOKS OF ACCOUNTS OF THE ASSESSEE, AND TIME AND AGAIN, THIS FACT WAS MENTION ED BY THE AO IN THE ASSESSMENT ORDER. IT WAS ACCORDINGLY HELD BY THE LD . CIT(A) THAT AO HAS IN SUBSTANCE REJECTED THE BOOKS OF ACCOUNTS AND AFTER DOING SO, THE AO SHOULD ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 3 HAVE COMPUTED ESTIMATED INCOME BY ESTIMATING TURNOV ER OF THE ASSESSEE AND SHOULD HAVE APPLIED NET PROFIT RATE FOR COMPUTING T HE INCOME OF THE ASSESSEE. 6. IN THIS REGARD, WE REFER TO THE REMAND REPORT O F THE AO, WHEREIN HE HAS SUBMITTED HIS COMMENTS ON THE REJECTION OF BOOKS OF ACCOUNTS, DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT( A) WHICH ARE AS UNDER:- IN ITS COUNTER COMMENTS, THE A.O. HAS MENTIONED A S UNDER:- AS IT HAS ALREADY BEEN STATED IN ASSESSMENT ORDER THAT THE ASSESSMENT WAS MADE ON THE BASIS OF ASSESSEES BOOKS OF ACCOUN T AND IMPOUNDED DOCUMENTS. THE REGULAR BOOKS OF ACCOUNT HAS NOT BEEN REJECTED BY THE A.O. AND HEAD WISE ADDITION HAS BEEN MADE ON THE BASIS OF IMPOUNDED BOOKS AND DOCUMENTS AND OTHER IRREGULA RITIES NOTICED DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN THE REGULAR BOOKS OF ACCOUNT OF ASSESSEE. THE UNRECORDED EXPENSES/PURCHASE FOUND IN IMPOUNDED DOCUMENTS HAS BEEN CONSIDERED BY THE SPECIAL AUDITO R IN AUDIT REPORT WITH THE REMARKS THAT THEY HAVE ENTERED THES E EXPENSES/ PURCHASES IN BOOKS JUST TO PREPARE CORREC T CASH INFLOW/ OUTFLOW STATEMENT AND THE TAXABILITY OF THOSE EXPENSES/ PURCHASE SHALL BE SEEN IN LIGHT OF THE PROVISION OF SECTION 69C OF THE IT ACT AT THE TIME OF ASSESSMENT. FURTHER DURING THE C OURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAS REPEATEDLY SAID MOSTLY IN EACH REPLY OF QUERY THAT HIS BOOKS OF ACCOUNT SHOULD BE REJECTED AS DONE IN PAST ASSESSMENT YEARS, EXCEPT IN TWO POINTS OF ADDITION HE HAS NOT EVEN DISPUTED THE QUANTUM OF ADDITION WHICH INDICATES TH AT HE WAS AGREED WITH THE QUANTUM OF ADDITIONS BUT ONLY HE HAS REPEA TEDLY ARGUED TO REJECT THE BOOKS OF ACCOUNT AS DONE IN THE ASSESSME NT OF THE PREVIOUS ASSESSMENT YEARS AND REQUESTED TO APPLY THE NP RAT E. ALL THE REPLIES FILED BY ASSESSEE DURING THE COURSE OF ASSESSMENT P ROCEEDINGS HAVE BEEN REPRODUCED IN EVERY ADDITION IN WHICH THE ASSE SSEE HAS REPEATED THE SAME ABOUT APPLICABILITY OF NP RATE AND REJECTI ON OF BOOKS. THE CONTENTION OF ASSESSEE FOR REJECTION OF BOOKS O N THE BASIS OF THE JUDGMENT OF HONBLE ITAT IS ALSO NOT SEEMS CORRECT BECAUSE THE JUDGMENT OF THE HONBLE ITAT IS NOT APPLICABLE ON T HIS ASSESSMENT AS AO HAS NOT REJECTED THE BOOKS OF THE ASSESSEE AND H AS MADE THE ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 4 ADDITIONS ON THE BASIS OF IMPOUNDED BOOKS AND DOCUM ENTS AND REGULAR BOOKS OF ACCOUNT OF ASSESSEE. FURTHER, THE DEPARTME NT HAS MOVED AN APPEAL BEFORE THE HONBLE RAJASTHAN HIGH COURT AGAI NST SAID ORDER OF THE HONBLE ITAT. 7. IN THIS REGARD, WE ALSO REFER TO THE FINDING OF THE LD. CIT(A) WHEREIN HE HAS UPHELD THE ACTION OF THE AO IN REFERRING THE MA TTER FOR SPECIAL AUDIT U/S 142(2A) OF THE ACT. THE LD CIT(A) HAS UPHELD THE ACTION OF THE AO RELYING ON THE FINDING OF THE COORDINATE BENCH IN ASSESSEES O WN CASE IN THE PREVIOUS ASSESSMENT YEARS. THE RELEVANT FINDINGS OF THE COO RDINATE BENCH ARE CONTAINED AT PARA 4.12 OF THE LD. CIT(A) ORDER WHIC H ARE REPRODUCED AS UNDER:- 4.12 THIS ISSUE CAME UP BEFORE HONBLE TRIBUNAL IN THE CASE OF ASSESSEE ITSELF IN THE APPEALS OF PREVIOUS ASSESSME NT YEARS. THE HONBLE TRIBUNAL OBSERVED AS UNDER:- THE FACTS IN THIS CASE ARE SIMILAR TO THE FACTS IN THE CASE OF SHRI RITESH SOMANI. WHILE DECIDING THE APPEAL IN THE CASE OF SH RI RITESH SOMANI IN ITA NO. 592 TO 597/JP/2011 AND 618 TO 623/JP/2011, VIDE ORDER DATED 30.11.2012, WE HAVE HELD THAT REFERENCE FOR SPECIAL AUDIT IS IN ACCORDANCE WITH THE PROVISIONS OF LAW. FOLLOWING TH AT ORDER WE DISMISS THE ABOVE GROUND OF APPEAL. IN THE CASE OF SHRI RITESH SOMANI, WHILE HOLDING TH AT THE A.O. WAS JUSTIFIED IN REFERRING THE MATTER FOR SPECIAL AUDIT U/S 142(2A) OF THE ACT, THE HONBLE ITAT MADE THE FOLLOWING ELABORATE OBSER VATIONS:- BEFORE US, THE LD. AR HAS RELIED UPON THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. BA JRANG TEXTILES (SUPRA). IN THIS CASE, THE A.O. ISSUED THE DIRECTIO NS TO GET THE ASSESSEES ACCOUNTS AUDITED ON 29 TH DECEMBER, 1999 WHEN ONLY ONE DAY WAS LEFT FOR COMPLETION OF THE BLOCK ASSESSMENT . THE A.O. ALSO DIRECTED THE SPECIAL AUDITOR TO PREPARE THE BOOKS O F ACCOUNTS IN THE FORM OF CASH BOOK, LEDGER ON THE BASIS OF THE DOCUM ENTS/ PAPERS SEIZED DURING THE COURSE OF SEARCH AS PER HIS DIRECTIONS. THE AUDITOR WAS ALSO REQUIRED TO PREPARE THE TRADING AND PROFIT ACCOUNT AND FURTHER TO DETERMINE THE UNDISCLOSED INCOME OF THE BLOCK PERIO D. THE HONBLE HIGH ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 5 COURT OBSERVED THAT APPARENTLY THE ORDER WAS FOR PR EPARING FRESH BOOKS RATHER THAN TO CONDUCT THE SPECIAL AUDIT. HONBLE H IGH COURT OBSERVED THAT NO AUTHORITY HAS BEEN GIVEN TO THE ASSESSEE DI RECT THE PREPARATION OF FRESH BOOKS BY REFERRING THE MATTER TO THE AUDIT OR UNDER SPECIAL AUDIT. THE AUDIT IS FOR THE PURPOSE OF SATISFYING O NE ABOUT THE AUTHENTICITY AND CREDIBILITY OF THE ACCOUNTS PREPAR ED BY THE ASSESSEE BUT NOT FOR PREPARING THE NEW ACCOUNT BOOKS AS PER DIRECTION OF THE A.O. IN THE INSTANCE CASE THE A.O. ASKED THE SPECIA L AUDITOR TO DO THE SPECIAL AUDIT IN VIEW OF THE PROVISIONS OF RULE 14A . RULE 14A SAYS THAT REPORT OF THE AUDIT IS TO BE GIVEN IN THE FORM NO. 6B. FORM NO. 6B MENTIONS ABOUT VARIOUS ITEMS ON WHICH THE SPECIAL A UDITOR HAS TO GIVE HIS REPORT. SUCH ITEMS CONTAINED IN THE FORM NO. 6B WAS ALSO INTIMATED TO THE SPECIAL AUDITOR. IT IS TRUE THAT THE A.O. RE QUIRED THE AUDITOR TO EXAMINE ALL THE ACCOUNT BOOKS, BILLS, VOUCHERS, LOO SE PAPERS, DOCUMENTS, BANK STATEMENT ETC. AND TO PREPARE THE C ASH INFLOW/OUTFLOW STATEMENTS, CASH BOOKS, LEDGER, TRAIL BALANCE, FINA L ACCOUNTS, TRADING AND PROFIT AND LOSS ACCOUNT, BALANCE SHEET ETC. FOR DIFFERENT ASSESSMENT YEARS AS MENTIONED ABOVE WITH THE AIM TO ENABLE THE DEPARTMENT TO ARRIVE AT THE TRUE STATE OF AFFAIRS OF VARIOUS CONC ERNS IN WHICH THE ASSESSEE IS ASSOCIATED EITHER AS A PROPRIETOR OR PA RTNER. THE BASIC PURPOSE WAS FOR EXAMINED OF THE BOOKS OF ACCOUNTS AND TO GIVE THE COMMENTS ON DIFFERENT ISSUES INCLUD ING THE VIOLATION OF PROVISIONS OF SECTION 269SS, 269T AND SECTION 40A(3) OF THE IT ACT. THE A.O. HAS MENTIONED IN THE LETTER THAT AUDIT IS TO BE CARRIED OUT IN VIEW OF THE PROVISION S OF RULE 14A. ONE HAS TO READ ENTIRE LETTER TOGETHER AND FROM THI S LETTER ONE CANNOT INFER THAT THE A.O. REFERRED THE MATTER FOR SPECIAL AUDIT FOR GETTING THE BOOKS OF ACCOUNTS PREPARED. THE FACTS IN THE INSTANT CASE ARE DISTINGUISHABLE FROM THE FACTS OF CIT VS. BAJRANG TEXTILES (SUPRA) IN WHICH THE AUDIT WAS REFERRED JU ST ONE DAY PRIOR TO THE LIMITATION PERIOD. THE FACTS AND CIRCUMSTANCES OF THE CASE OF ASSESSEE FOR ASSESSMENT YEAR 2009-10 ARE SIMILAR WITH THE FACTS AND CIRCUMS TANCES OF THE CASE OF ASSESSEE FOR A.Y. 2004-05 TO 2008-09 FOR WHICH THE HONBLE ITAT HAS DECIDED AS ABOVE SO FAR AS THIS GROUND IS CONCERNED . ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 6 FOLLOWING THE DECISION OF HONBLE TRIBUNAL (THE FAC TS BEING IDENTICAL THE ISSUE IS DECIDED IN FAVOUR OF REVENUE AND AGAINST T HE ASSESSEE). THIS GROUND OF APPEAL IS DISMISSED. 8. IN LIGHT OF ABOVE, IN THE INSTANT CASE, IT IS C LEAR THAT THE BASIC PURPOSE FOR REFERRING THE MATTER TO THE SPECIAL AUDITOR WAS TO EXAMINE THE BOOKS OF ACCOUNTS AND TO GIVE HIS COMMENTS ON VARIOUS ISSUES AND NOT TO GET THE BOOKS OF ACCOUNTS PREPARED. IT IS THEREFORE IN CONSONANCE WITH THE COMMENTS OF THE AO IN THE REMAND PROCEEDINGS AS NOTED ABOVE THAT TH E UNRECORDED EXPENSES/PURCHASE FOUND IN IMPOUNDED DOCUMENTS HAS BEEN CONSIDERED BY THE SPECIAL AUDITOR IN AUDIT REPORT WITH THE REMARK S THAT THEY HAVE ENTERED THESE EXPENSES/ PURCHASES IN BOOKS JUST TO PREPARE CORRECT CASH INFLOW/ OUTFLOW STATEMENT. 9. THE PROVISIONS OF SECTION 145(3) OF THE ACT PRO VIDES THAT WHERE THE ASSESSING OFFICER IS NOT SATISFIED ABOUT THE CORREC TNESS OR COMPLETENESS OF THE ACCOUNTS OF THE ASSESSEE, OR WHERE THE METHOD OF AC COUNTING PROVIDED IN SUB- SECTION (1) HAS NOT BEEN REGULARLY FOLLOWED BY THE ASSESSEE, OR INCOME HAS NOT BEEN COMPUTED IN ACCORDANCE WITH THE STANDARDS NOTIFIED UNDER SUB- SECTION (2), THE ASSESSING OFFICER MAY MAKE AN ASSE SSMENT IN THE MANNER PROVIDED IN SECTION 144. THERE HAS TO BE A SPECIFIC FINDING GIVEN BY THE AO IN TERMS OF SATISFACTION OF ANY OR ALL OF THE ABOVE CO NDITIONS BEFORE HE REJECTS THE BOOKS OF ACCOUNTS OF THE ASSESSEE. FURTHER, THE AO HAS TO SPECIFY THE REASONS AS TO WHY HE FEELS THAT THE RESULTS DECLARED BY THE BOOKS OF ACCOUNTS ARE NOT ACCEPTABLE. HOWEVER, IN THE REMAND PROCEEDINGS, AS WE HAVE NOTED ABOVE, THE AO HAS DRAWN REFERENCE TO HIS FINDINGS DURING T HE COURSE OF ASSESSMENT PROCEEDINGS THAT THE REGULAR BOOKS OF ACCOUNT HAS N OT BEEN REJECTED AND HEAD WISE ADDITION HAS BEEN MADE ON THE BASIS OF IM POUNDED BOOKS AND DOCUMENTS AND OTHER IRREGULARITIES NOTICED DURING T HE COURSE OF ASSESSMENT PROCEEDINGS IN THE REGULAR BOOKS OF ACCOUNT OF ASSE SSEE. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 7 10. FURTHER, SECTION 142(2A) OF THE ACT PROVIDES T HAT IF ANY STAGE OF THE PROCEEDINGS BEFORE HIM, THE ASSESSING OFFICER, HAVI NG REGARD TO THE NATURE AND COMPLEXITY OF THE ACCOUNTS, VOLUME OF THE ACCOU NTS, DOUBTS ABOUT THE CORRECTNESS OF THE ACCOUNT, MULTIPLICITY OF THE TRA NSACTIONS IN THE ACCOUNTS OR SPECIALIZED NATURE OF BUSINESS ACTIVITIES OF THE AS SESSEE AND THE INTEREST OF THE REVENUE, IS OF THE OPINION THAT IT IS NECESSARY TO DO SO, HE MAY WITH THE PREVIOUS APPROVAL OF THE PRINCIPAL CIT DIRECT THE A SSESSEE TO GET THE ACCOUNTS AUDITED BY AN ACCOUNTANT AND TO FURNISH A REPORT OF SUCH AUDITED ACCOUNTS IN THE PRESCRIBED FORM DULY SIGNED AND VERIFY BY SUCH ACCOUNTANT SETTING FORTH SUCH PARTICULARS AS MAY BE PRESCRIBED AND SUCH OTHE R PARTICULARS OF THE ASSESSING OFFICER MAY REQUIRE. 11. IN THE INSTANT CASE, A SURVEY U/S 133A WAS CAR RIED OUT ON 01.10.2008 AT THE BUSINESS PREMISES OF THE ASSESSEE. ON THE B ASIS OF NATURE AND COMPLEXITY OF THE ACCOUNTS, LOOSE PAPERS AND INCRIM INATING DOCUMENTS FOUND DURING THE COURSE OF SURVEY, THE CASE WAS REFERRE D FOR SPECIAL AUDIT U/S 142(2A) BY CIT, KOTA. THE ASSESSING OFFICER HAS STA TED AT PARA-3 OF HIS ASSESSMENT ORDER AS TO THE PRECISE REASONS AS TO WH Y THE CASE WAS REFERRED FOR SPECIAL AUDIT AND THE SAME IS REPRODUCED AS UND ER:- 3. IN THIS CONTEXT, IT WAS NOTICED THAT DURING THE COURSE OF HEARING DATED 21.11.2011, THE A/R OF THE ASSESSEE, SHRI HAR ISH DHYANI, CA ALONG WITH SHRI VINOD DUGGAR, ACCOUNTANT APPEARED. THEY INSPECTED THE IMPOUNDED RECORDS. IN THEIR PRESENCE, THIS OFFICE T RIED TO WORK OUT UNRECORDED SALES, UNRECORDED INVESTMENTS AND OTHER UNDISCLOSED INCOME ETC. THE A/R AND ACCOUNTANT OF THE ASSESSEE WERE ASKED TO GET THE ENTRIES VERIFIED AS APPEARING IN IMPOUNDED MATE RIAL VIS-A-VIS REGULAR BOOKS OF ACCOUNT OF THE ASSESSEE, BUT THEY HAVE FAI LED AND COULD NOT GET THE SAME VERIFIED. AFTER GOING THROUGH MATERIAL /ENTRIES AVAILABLE IN THE IMPOUNDED RECORDS WITH THIS OFFICE AS WELL AS L OOKING TO THE VOLUME OF IMPOUNDED RECORD COMPLEXITY THEREIN, IT HAS BEEN DECIDED THAT IT IS NECESSARY TO GET SPECIAL AUDIT CONDUCTED IN THIS CASE BY AN ANOTHER CHARTERED ACCOUNTED U/S 142(2A) OF THE IT A CT, 1961 IN ORDER TO SEGREGATE THE TRANSACTIONS FROM THE INC RIMINATING ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 8 DOCUMENTS IMPOUNDED DURING THE SURVEY PROCEEDINGS, WHICH WERE NOT ASCERTAINED FROM THE REGULAR BOOKS OF ACCO UNT. 12. THE A.O. IN THE ASSESSMENT ORDER HAS STATED TH AT THE SPECIAL AUDITOR IN HIS REPORT SUBMITTED ON 18.06.2012 HAD POINTED OUT A NUMBER OF DEFECTS IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. FURTHER, TH E ASSESSING OFFICER AT PARA 6 OF HIS ASSESSMENT ORDER STATED AS UNDER: THE ASSESSMENT PROCEEDINGS ARE BEING CONCLUDED AS PER DETAILS PRODUCED, ON THE BASIS OF DOCUMENTS IMPOUNDED DURING THE COURSE OF SURVEY, ON THE BASIS OF BOOKS OF ACCOUNTS, TRADING, PROFIT AND LOSS ACCO UNT, BALANCE SHEET PRODUCED BY THE ASSESSEE AND WITH THE HELP OF RE-CASTED BOOK S OF ACCOUNTS AND SPECIAL AUDIT REPORT TO ASCERTAIN CORRECT SALES, PURCHASES , UNRECORDED AND EXCESSIVE EXPENDITURE RECORDED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. 13. IN LIGHT OF ABOVE, IT IS CLEAR THAT BASED ON N ATURE AND COMPLEXITY OF ACCOUNTS, VOLUME OF LOOSE PAPERS, INCRIMINATING DOC UMENTS FOUND DURING THE COURSE OF SURVEY AND TO IDENTIFY AND SEGREGATE THE TRANSACTIONS FROM THE INCRIMINATING DOCUMENTS IMPOUNDED DURING THE SURVEY PROCEEDINGS WHICH WERE NOT ASCERTAINED FROM THE REGULAR BOOKS OF ACCO UNT, SPECIAL AUDIT WAS REFERRED TO BY THE CIT, KOTA. THE SPECIAL AUDITOR H AS POINTED OUT A NUMBER OF DEFECTS IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE AN D THE UNRECORDED EXPENSES PURCHASES, SALES AND OTHER INCOME AS FOUND OUT BASED ON EXAMINATION OF THE DOCUMENTS SO IMPOUNDED HAVE BEEN INCORPORATED IN THE RE-CASTED BALANCE SHEET AND PROFIT AND LOSS ACCOUNT FOR THE LIMITED PURPOSES OF DEPICTING A CLEAR PICTURE OF FUND FLOW OF THE AS SESSEE. THE ASSESSING OFFICER HAS CONSIDERED THE DEFECTS SO OBSERVED BY THE SPECI AL AUDITOR IN HIS REPORT AND AFTER GIVING AN OPPORTUNITY TO THE ASSESSEE MAD E SPECIFIC ADDITIONS/DISALLOWANCE AS WE HAVE NOTED ABOVE. 14. HOWEVER, WE FIND THAT THERE IS NO SPECIFIC FIN DING WHICH HAS BEEN RECORDED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER RECORDING HIS ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 9 SATISFACTION AS TO REJECTION OF THE BOOKS OF ACCOUN TS AND THE RESULT SO DECLARED BY THE ASSESSEE. IT IS TRUE THAT THE MATTER WAS REF ERRED FOR SPECIAL AUDIT U/S 142(2A) BUT THAT BY ITSELF WILL NOT RESULT IN AN IM PLIED FINDING OF THE AO ABOUT HIS NON-SATISFACTION ABOUT THE BOOKS OF ACCOUNTS AN D REJECTION THEREOF. AS NOTED BY THE COORDINATE BENCH AS WELL, THE BASIC PU RPOSE FOR SPECIAL AUDIT WAS FOR EXAMINATION OF THE BOOKS OF ACCOUNTS AND TO GIVE SPECIFIC COMMENTS ON SPECIFIC ISSUES AND IT CANNOT BE INFERRED THAT T HE MATTER FOR SPECIAL AUDIT WAS REFERRED FOR GETTING THE WHOLE OF THE BOOKS OF ACCOUNT RECASTED AND PREPARATION THEREOF AFRESH. THE DEFECTS SO POINTED OUT BY THE SPECIAL AUDITOR HAVE BEEN INCORPORATED IN THE RECASTED BOOKS OF ACC OUNTS EFFECTIVELY MEANS TAKING INTO CONSIDERATION THE RESULTS ALREADY DECLA RED BY THE ASSESSEE IN RESPECT OF ITS DECLARED TRANSACTIONS AND THE RESULT S AS PER UNRECORDED TRANSACTIONS RELATING TO PURCHASE AND SALES AND OTH ER INCOME, PRESENTING AN OVERALL POSITION REGARDING THE BUSINESS RESULTS IN RELATION TO ACTIVITIES CARRIED OUT BY THE ASSESSEE. THEREFORE, WE ARE OF THE CONS IDERED VIEW THAT MERELY BECAUSE THE MATTER WAS REFERRED FOR SPECIAL AUDIT A ND THE AO HAS MADE CERTAIN ADDITIONS BASED ON THE OBSERVATIONS OF THE SPECIAL AUDITOR, IT CANNOT BE HELD THAT THE AO HAS REJECTED THE BOOKS OF ACCOUNT OF THE ASSESSEE. THERE HAS TO BE A SPECIFIC FINDING GIVEN BY THE AO IN TERMS O F SATISFACTION OF ANY OR ALL OF THE CONDITIONS AS SPECIFIED UNDER SECTION 145(3) BE FORE HE REJECTS THE BOOKS OF ACCOUNTS OF THE ASSESSEE. FURTHER, THE AO HAS T O SPECIFY THE REASONS AS TO WHY HE FEELS THAT THE RESULTS DECLARED BY THE ASSES SEE AS PER THE BOOKS OF ACCOUNTS ARE NOT ACCEPTABLE. 15. NOW, LETS LOOK AT THE MATTER FROM ANOTHER PE RSPECTIVE. IN ABSENCE OF THE SPECIFIC FINDING OF REJECTION OF BOOKS OF ACCOU NTS BY THE AO, CAN IT BE INFERRED THAT THE AO HAS REJECTED THE BOOKS OF ACCO UNTS OF THE ASSESSEE. IN THIS REGARD, WE REFER THE RECASTED PROFIT/LOSS ACCO UNT FOR THE YEAR ENDED MARCH 31, 2009 WHICH IS AVAILABLE ON RECORD. THE A NALYSIS THEREOF IN TERMS OF ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 10 RECORDED TRANSACTIONS AND UNRECORDED TRANSACTIONS D EPICTS THE FOLLOWING POSITION: PARTICULARS TOTAL AS PER RECASTED PROFIT/LOSS ACCOUNT (RS) UNRECORDED TRANSACTIONS (RS) RECORDED TRANSACTIONS (RS) % OF RECORDED TRANSACTI ONS A B C = A-B D= C/A*100 SALES 1,52,64,043 28,73,377 (98,948+14,02,856+ 12,27,248+144,325) 12,390,666 81.18% TRANSPORTATI ON RECEIPTS 35,79,117 195,889 33,83,228 94.52% LOADING RECEIPTS 759,302 10,000 749,302 98.68% TOTAL TURNOVER 1,96,02,462 30,79,266 1,65,23,196 84.29% 16. AS IT IS APPARENT FROM ABOVE TABLE, TURNOVER T O THE EXTENT OF 84.29% IS AS PER THE RECORDED TRANSACTIONS IN THE BOOKS OF AC COUNTS OF THE ASSESSEE WHICH HAS BEEN CONSIDERED BY THE AO AND ONLY THE BA LANCE TURNOVER TO THE EXTENT OF 15.71% IS AS PER UNRECORDED TRANSACTIONS WHICH HAS BEEN FOUND OUT BASED ON THE IMPOUNDED DOCUMENTS. AND THERE ARE COR RESPONDING EXPENSES AS RECORDED IN THE BOOKS OF ACCOUNTS WHICH HAVE BEE N CONSIDERED BY THE AO OTHER THAN THOSE WHICH HAVE BEEN DISCOVERED AND REP ORTED AS PER SPECIAL AUDIT. IN LIGHT OF THE SAME, CAN IT BE INFERRED THA T THE AO HAS REJECTED THE WHOLE OF THE BOOKS OF ACCOUNTS OF THE ASSESSEE. IN OUR VIEW, SUCH A CONCLUSION WOULD BE WHOLLY UNTENABLE AND INCORRECT IN THE PRESENT FACTS OF THE ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 11 CASE. THE REASONS FOR THE SAME IS THAT FIRSTLY, TH E AO HAS NOT MADE ANY ADJUSTMENT IN RELATION TO THE BOOKS RESULTS SO DECL ARED BY THE ASSESSEE IN RESPECT OF REPORTED TRANSACTIONS AND INFACT, HAS AC CEPTED THE SAME. WHEN THE BOOK RESULTS RELATING TO MORE THAN 84% OF TURNO VER HAVE BEEN ACCEPTED, CAN IT BE INFERRED THAT THE BOOKS OF ACCOUNTS, BASI S WHICH THE BOOK RESULTS HAVE BEEN SO DECLARED, HAVE BEEN REJECTED AND THE A NSWER TO THE SAME CANNOT BE IN AFFIRMATIVE. IN OUR VIEW, ALL THE AO HAS DONE IS THAT HE HAS ACCEPTED THE BOOK RESULTS IN RESPECT OF RECORDED TR ANSACTIONS AND IN ADDITION, THE UNRECORDED TRANSACTIONS RELATING TO SALES/INCOM E, UNRECORDED PURCHASE AND OTHER EXPENDITURE HAVE ALSO BEEN BROUGHT TO TAX . IN ANY CASE, THERE CANNOT BE A PRESUMPTION REGARDING REJECTION OF BOOK S OF ACCOUNTS IN ABSENCE OF SPECIFIC EXERCISE OF POWERS UNDER SECTION 145(3) OF THE ACT. 17. FURTHER WE FIND THAT THERE IS NO SPECIFIC FIND ING WHICH HAS BEEN GIVEN BY THE LD. CIT(A) WHEREIN IN EXERCISE OF HIS CO-TER MINUS POWERS, HE IS OF THE OPINION THAT THE BOOKS OF ACCOUNTS CANNOT BE RELIED UPON AND DESERVE TO BE REJECTED IN THE INSTANT CASE. ALL THE LD CIT(A) HAS STATED IS THAT THE AO HAS IN SUBSTANCE REJECTED THE BOOKS OF ACCOUNTS AND AFTER DOING SO, THE AO SHOULD HAVE COMPUTED ESTIMATED INCOME BY ESTIMATING TURNOV ER OF THE ASSESSEE AND SHOULD HAVE APPLIED NET PROFIT RATE FOR COMPUTING T HE INCOME OF THE ASSESSEE. CAN REJECTION OF BOOKS OF ACCOUNTS BE AT THE INSTAN CE OF THE ASSESSEE 18. BEFORE DEPARTING, WE WOULD ALSO LIKE TO TOUCH UPON ANOTHER PERSPECTIVE WHICH WE HAVE NOTICED IN THE INSTANT CASE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IN RESPONSE TO EACH OF THE QUERIES RAI SED BY THE AO IN RELATION TO OBSERVATIONS OF THE SPECIAL AUDITOR, THE ASSESSEE H AS REPEATEDLY STATED THAT HIS BOOKS OF ACCOUNT SHOULD BE REJECTED AS DONE IN PAST ASSESSMENT YEARS. THE QUESTION THAT ARISES FOR CONSIDERATION WHETHER THE POWERS TO BE EXERCISED UNDER SECTION 145(3) CAN BE EXERCISED AT THE REQUES T OF THE ASSESSEE. TO RECAPITULATE, SECTION 145(3) PROVIDES THAT WHERE TH E ASSESSING OFFICER IS NOT ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 12 SATISFIED ABOUT THE CORRECTNESS OR COMPLETENESS OF THE ACCOUNTS OF THE ASSESSEE, OR WHERE THE METHOD OF ACCOUNTING PROVIDE D IN SUB-SECTION (1) HAS NOT BEEN REGULARLY FOLLOWED BY THE ASSESSEE, OR INC OME HAS NOT BEEN COMPUTED IN ACCORDANCE WITH THE STANDARDS NOTIFIED UNDER SUB-SECTION (2), THE ASSESSING OFFICER MAY MAKE AN ASSESSMENT IN THE MANNER PROVIDED IN SECTION 144 OF THE ACT. IT IS FOR THE ASSESSEE TO DECLARE ITS RESULTS AND OFFER ITS BOOKS OF ACCOUNTS FOR VERIFICATION AND THEN, IT IS FOR AO TO DETERMINE WHETHER THE BOOK RESULTS SO DECLARED ARE CORRECT OR NOT OR THE BOOKS OF ACCOUNTS HAVE TO BE REJECTED AS NOT DEPICTING CORRECT STATE OF AF FAIRS OF THE ASSESSEE. IN OUR CONSIDERED VIEW, THERE IS NOTHING IN THE SAID PROVI SIONS WHEN EMPOWER THE ASSESSEE TO REQUEST THE AO TO REJECT HIS BOOKS OF A CCOUNTS. 19. FURTHER, EACH YEAR IS SEPARATE YEAR AND THE PR INCIPLE OF RES-JUDICATA DOESNT APPLY IN THE INCOME TAX PROCEEDINGS. AND W E AGREE WITH THE VIEW OF THE AO THAT THE CONTENTION OF ASSESSEE FOR REJECTIO N OF BOOKS ON THE BASIS OF THE PAST DECISIONS OF THE COORDINATE BENCH ALSO NOT SEEMS CORRECT BECAUSE THE JUDGMENT OF THE COORDINATE BENCH IS NOT APPLICA BLE ON THIS ASSESSMENT AS AO HAS NOT REJECTED THE BOOKS OF THE ASSESSEE AND H AS MADE THE ADDITIONS ON THE BASIS OF REGULAR BOOKS OF ACCOUNT OF ASSESSEE A S WELL AS TAKING INTO CONSIDERATION DOCUMENTS IMPOUNDED DURING THE COURSE OF SURVEY AND THE REPORT OF THE SPECIAL AUDITOR THEREON. 20. IN LIGHT OF ABOVE DISCUSSIONS AND IN THE ENTIR ETY OF FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT THE BOOKS OF ACCOUNTS HAVE NOT BEEN REJECTED IN THE INSTANT CASE. THE FINDING S OF THE LD CIT(A) TO THIS EXTENT IS SET-ASIDE AND THE FINDINGS OF THE AO ARE CONFIRMED. ESTIMATION OF NET PROFIT VIS-A-VIS SPECIFIC DISALLO WANCES/ADDITIONS DONE BY THE AO 21. IN GROUND NO. 3, THE REVENUE HAS CHALLENGED TH E ACTION OF THE LD CIT(A) IN HOLDING THAT AO HAD REJECTED BOOKS OF ACCOUNT OF THE ASSESSEE AND, ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 13 THEREFORE, ADDITION OF ONLY RS. 5,03,251/- IS REQUI RED TO BE MADE BY APPLYING NET PROFIT RATE OF 10% ON UNDISCLOSED SALES AND 9% ON DISCLOSED SALES OF ASSESSEE AS AGAINST THE FOLLOWING ADDITIONS MADE BY A.O. IN VIEW OF VARIOUS DISCREPANCIES IN IMPOUNDED BOOKS OF ACCOUNT VIS-A-V IS REGULAR BOOKS OF ACCOUNT OF THE ASSESSEE:- S.N. BRIEF PARTICULARS OF ADDITION ACCOUNTS (RS.) I) UNEXPLAINED EXPENDITURE U/S 69C 20,88,402/- II) EXPENSES CLAIMED EXCESSIVE/BOGUS 2,63,189/- III) DIFFERENT IN LEDGERS U/S 69B 28,30,670/- IV) UNRECORDED MARBLE & GRANITE PURCHASE & SALES 14 ,02,856/- VI) UNRECORDED LOADING RECEIPTS FROM RAILWAYS 1,95, 889/- VII) UNRECORDED SALES OF MARCH 2009 OF DABORA/BALLA ST TO RAILWAY 12,27,248/- VIII) UNRECORDED PURCHASES/LABOUR AND TRANSPORTATIO N CHARGES OF LIME 8,49,286 IX) UNRECORDED INCOME FROM CRUSHER HIRE CHARGES 10, 000/- X) UNEXPLAINED EXPENSES 1,14,800/- XI) TRANSPORTATION CHARGES PAID TO VARIOUS TRUCK OWNER FOR SUPPLY OF BALLAST/GRIT TO RAILWAY U/S 69C 3,00,000/- XII) UNRECORDED SALES AS PER ANNEXURE-17 1,44,325 XIII) UNEXPLAINED EXPENSES BEING REPAIR & MAINTENAN CE OF PLANT & MACHINERY 2,64,877/- XIV) UNEXPLAINED TRANSPORTATION EXPENSES 6,49,962/- TOTAL 1,04,40,452/- 22. THE RELEVANT FINDINGS OF THE LD. CIT(A) WHICH A RE UNDER CHALLENGE BEFORE US ARE AS UNDER:- THE A.O. HAD MADE SPECIFIC ADDITIONS ON THE ABOVE GROUNDS AND TOOK A STAND BEFORE ME THAT BOOKS OF ACCOUNTS OF ASSESSEE WERE N OT REJECTED AND THEREFORE EACH ADDITION SHOULD BE CONSIDERED SEPARATELY. I HAVE GONE THROUGH THE OBSERVATION OF A.O. AND IT WAS SEEN THAT IN SUBSTANCE THE A.O. NEVER RELIED ON THE BOOKS OF ACC OUNTS OF ASSESSEE AND TIME AND AGAIN THIS FACT WAS MENTIONED BY A.O. IN T HE ASSESSMENT ORDER. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 14 THEREFORE, IT IS HELD THAT A.O. HAS IN SUBSTANCE RE JECTED THE BOOKS OF ACCOUNTS AFTER DOING SO, THE A.O. SHOULD HAVE COMPUTED ESTIM ATED INCOME BY ESTIMATING TURNOVER OF ASSESSEE AND SHOULD HAVE APP LIED NET PROFIT RATE FOR COMPUTING THE INCOME OF ASSESSEE. THE NET PROFIT SHOWN BY ASSESSEE WAS RS. 10,95,464/ - ON A TURNOVER OF RS. 1,37,62,240/- WHICH GAVE NET PROFIT RATE OF 7.96%. THE NET PROFIT AS PER AUDITOR WAS RS. 8,81,116/- ON A TURNOVER OF RS. 1,5 7,64,044/- WHICH GAVE A NET PROFIT RATE OF 5.59%. ON THE BASIS OF FACTS BE FORE ME, DISCREPANCIES POINTED POINT BY A.O., HONBLE ITATS ORDER, NET PR OFIT RATE ON DECLARED TURNOVER IS ESTIMATED @ 9% WHICH GIVES NET PROFIT O F RS. 12,38,602/- RESULTING INTO ADDITION OF RS. 1,43,138/-. THE ASSESSEE, ITSE LF, HAS DISCLOSED NET PROFIT RATE OF 8% ON DISCLOSED SALES. AS HELD BY HONBLE I TAT ( IN EARLIER YEARS) SOME OF THE EXPENSES OF UNDISCLOSED TURNOVER STANDS INCLUDED IN DISCLOSED SALES THEREFORE THE SAME HAS TO BE EXCLUDED FROM DI SCLOSED TURNOVER (ON ESTIMATED BASIS) RESULTING IN HIGHER PROFIT. THE UNDISCLOSED TURNOVER OF ASSESSEE IS COMPUTED AS UNDER:- I) AS PER GROUND NO. 2(V) RS. 98,948/- II) AS PER GROUND NO. 2(VI) RS. 14,02,856/- III) AS PER GROUND NO. 2(VIII) RS. 1,95,889/- IV) AS PER GROUND NO. 2(IX) RS. 12,27,248/- V) AS PER GROUND NO. 2(XXII) RS. 1,44,325/- TOTAL RS. 30,69,266/- AS DISCUSSED IN GROUND NO. 2(X), THE SUPPRESSED SAL ES ON ACCOUNT OF UNDISCLOSED PRODUCTION COMES TO RS. 36,01,132/- WHE REAS THE SAME COMES TO RS. 30,69,266/- BY TAKING FIGURES OF UNDISCLOSED SA LE. GIVING THE BENEFIT OF ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 15 TELESCOPING THE UNDISCLOSED SALE FIGURE IS TAKEN AT RS. 36,01,132/- BEING HIGHER OF THE TWO. IN THE CASE OF ASSESSEE FOR A.Y. 2004-05, 2005-06, 2006-07, 2007-08 & 2008- 09 ITA NO. 602 TO 606 & 609 TO 613/JP/2011 THE HON BLE TRIBUNAL HAS APPLIED NET PROFIT RATE OF 6% ON DISCLOSES SALES AND NET PR OFIT RATE OF 8% ON UNDISCLOSED SALES. THE LOGIC FOR APPLYING HIGHER R ATE OF NET PROFIT (8% AS COMPARED TO 6%) WAS BECAUSE SOME OF THE EXPENSES IN RESPECT OF SUCH SALES STANDS INCLUDED IN DISCLOSED SALES APPLYING THE SAM E RATIO A NET PROFIT RATE OF 10% IS APPLIED ON UNDISCLOSED SALES (THE ASSESSEE, ITSELF, HAS DISCLOSED NET PROFIT RATE OF 8% ON DISCLOSED SALES). THIS GIVES NET PROFIT OF RS. 3,60,113/- ON UNDISCLO SED SALES, RESULTING INTO ADDITION OF RS. 5,03,251/- (3,60,113/- ON UNDISCLOS ED SALE + 1,43,138/- ON DISCLOSED SALES). THE ABOVE GROUNDS OF APPEAL DEALT WITH EITHER DISAL LOWANCE OF EXPENSES OR UNEXPLAINED SALES ETC AND ARE TREATED AS COVERED BY ESTIMATION OF INCOME [AS DISCUSSED ABOVE] AND ARE TREATED AS PARTLY ALLOWED. 23. IN GROUND NO. 4, THE REVENUE HAS CHALLENGED TH E ACTION OF THE LD CIT(A) IN DELETING THE ADDITION OF RS. 27,15,203/- MADE BY A.O. U/S 40(A)(IA) ON ACCOUNT OF NON-DEDUCTION OF TDS ON LABOUR & TRANSPO RTATION EXPENSES SINCE THE A.O. NEITHER REJECTED BOOKS OF ACCOUNT OF ASSES SEE NOR ESTIMATE INCOME BY APPLYING FIXED NET PROFIT RATE ON ASSESSEES SAL ES. 24. THE RELEVANT FINDINGS OF THE LD. CIT(A) ARE AS UNDER:- I HAVE GONE THROUGH THE AOS FINDING AND ASSESSEE S SUBMISSION AND COUNTER COMMENTS OF A.O. THE NATURE OF TRANSACTION (LABOUR & TRANSPORTATION) ITSELF SHOWS THAT NO WORK CAN BE DONE WITHOUT UNDERSTANDIN G BETWEEN THE PARTIES. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 16 NO PERSON WILL CARRY OUT WORK WITHOUT UNDERSTANDING ABOUT THE SCOPE OF WORK AND RESULTANT CONSIDERATION. THE FACT THAT WORK WAS DONE AND PAYMENTS WERE MADE ITSELF SHOWS THAT THERE WAS ORAL UNDERSTANDING BETWEEN THE PARTIES ABOUT THE SCOPE OF WORK AND CONSIDERATION. IT IS TH EREFORE HELD THAT THERE WAS CONTRACT BETWEEN THE PARTIES. THE ASSESSEE FURTHER SUBMITTED THAT ONCE BOOKS OF A CCOUNTS ARE REJECTED NO SEPARATE DISALLOWANCE CAN BE MADE. HE PLACED HIS RE LIANCE ON THE FOLLOWING JUDGMENTS:- I). CIT VS. GK CONTRACTORS (2009)19 DTR 305(RAJ. ). II). CHOUDHARY BROS. VS. ITO 135 TTJ 55 (JP.) III). ITO VS. SADHWANI BROS. 58 DTR 368 (JP.) IV). RAJENDRA KUMAR KEDIA 22 TW 506 & KIRAN UDHYOG 34 TW 80 WHILE DECIDING THE AFORESAID ISSUE MY PREDECESSOR C IT(A) HAS HELD AS UNDER:- IT HAS BEEN HELD BY VARIOUS JUDICIAL AUTHORITIES T HAT ONCE THE BOOKS OF ACCOUNTS ARE REJECTED AND INCOME IS ESTIMATED BY AP PLYING FIXED PROFIT RATE, NO FURTHER DISALLOWANCE IS JUSTIFIED U/S 40(A)(IA). AS MENTIONED EARLIER IN THIS CASE BOOKS OF ACCOUNTS OF APPELLANT ARE NOT CORRECT AND COMPLETE AND THEREFORE INCOME HAS BEEN ESTIMATED BY APPLYING FIX ED PROFIT RATE. THEREFORE, NO DISALLOWANCE U/S 40(A)(IA) IS JUSTIFIED. ADDITIO N OF RS. 3812700/- IS DIRECTED TO BE DELETED. GROUND NO. 4(X) IS THUS ALLOWED. I HAVE ALREADY HELD THAT BOOKS OF ACCOUNTS OF ASSES SEE WERE AS REJECTED AND INCOME OF ASSESSEE WAS TO BE ESTIMATED. THEREFORE, NO DISALLOWANCE U/S 40(A)(IA) IS JUSTIFI ED. THE A.O. IS DIRECTED TO DELETE THE ADDITION OF RS. 27,15,203/- ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 17 25. IN GROUND NO. 6, THE REVENUE HAS CHALLENGED TH E ACTION OF THE LD CIT(A) IN DELETING THE ADDITION OF RS. 36,45,562/- MADE BY A.O. ON ACCOUNT OF VIOLATION OF PROVISIONS OF SECTION 40A(3) SINCE THE AO NEITHER REJECTED BOOKS OF ACCOUNT OF THE ASSESSEE NOR ESTIMATED INCOME BY APPLYING NET PROFIT RATE ON SALES. 26. THE RELEVANT FINDING OF THE LD. CIT(A) ARE AS U NDER:- THE A.O. MADE ADDITION OF RS. 36,45,562/- FOR VIOL ATION OF PROVISION OF SECTION 40A(3). AS HELD BY ME THE BOOKS OF ACCOUNT OF ASSESSEE WERE REJECTED AND PROFIT HAS TO BE ESTIMATED. THEREFORE, IN VIEW OF VARIOUS JUDGMENT [E.G. CIT VS. G.K. CONTRACTORS (2009) 19DTR 305 (RAJ.)] N O ADDITION IS CALLED FOR WHEN NET PROFIT RATE IS APPLIED. THE A.O. IS THEREF ORE DIRECTED TO DELETE ADDITION OF RS. 36,45,562/- OUR FINDINGS 27. THE ASSESSING OFFICER HAS MADE SPECIFIC DISALL OWANCES/ADDITIONS UNDER VARIOUS SPECIFIC HEADS SUCH AS UNEXPLAINED EXPENDIT URE U/S 69C, EXPENSES CLAIMED EXCESSIVE/ BOGUS, DIFFERENCES IN LEDGERS U/ S 69B, UNRECORDED MARBLE & GRANITE PURCHASES, UNRECORDED PURCHASES/LABOUR AN D TRANSPORTATION CHARGES OF LIME, UNEXPLAINED EXPENSES, TRANSPORTATION CHARG ES PAID TO VARIOUS TRUCK OWNER FOR SUPPLY OF BALLAST/GRIT TO RAILWAY U/S 69C , UNEXPLAINED EXPENSES BEING REPAIR & MAINTENANCE OF PLANT AND MACHINERY, UNEXPLAINED TRANSPORTATION EXPENSES, ADDITION ON ACCOUNT OF NON - DEDUCTION OF TDS ON LABOUR & TRANSACTIONS U/S 40(A)(IA), ADDITION ON AC COUNT OF VIOLATION OF PROVISIONS OF SECTION 40A(3), ETC. THE LD CIT(A) HA S HELD THAT SINCE THE BOOKS OF ACCOUNTS HAVE BEEN REJECTED, ESTIMATION OF NET P ROFIT SHOULD BE MADE IN THE INSTANT CASE. FURTHER, LD CIT(A) HAS HELD THAT WHERE BOOKS OF ACCOUNTS HAVE BEEN REJECTED AND NET PROFIT HAS BEEN ESTIMATE D, NO SEPARATE ADDITIONS CAN BE MADE RELYING ON THE SAME BOOKS OF ACCOUNTS. THE LD. CIT(A) HAS ACCORDINGLY ESTIMATED NET PROFIT AT 10% OF THE UND ECLARED TURNOVER AND 9% ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 18 OF THE DECLARED TURNOVER OF THE ASSESSEE AND HAS DE LETED SPECIFIC ADDITIONS/DISALLOWANCES OF VARIOUS EXPENSES. 28. AS WE HAVE HELD ABOVE, THERE IS NO BASIS TO HO LD THAT THE BOOKS OF ACCOUNTS HAVE BEEN REJECTED IN THE INSTANT CASE. W HERE THE BOOKS OF ACCOUNTS HAVE NOT BEEN REJECTED, THERE IS NO BASIS TO ESTIMATE THE NET PROFIT AS DONE BY THE LD CIT(A). CONSEQUENTLY, THERE IS N O ESTOPPEL TO MAKE SPECIFIC ADDITIONS/DISALLOWANCES IN TERMS OF SECTION 40(A)(I ), 40A(3) AND OTHER SPECIFIC DISALLOWANCES TOWARDS UNEXPLAINED EXPENDITURE. IN OUR VIEW THE ASSESSING OFFICER HAS MADE THE SPECIFIC ADDITIONS/DISALLOWANC ES BASED ON SPECIFIC MATERIAL WHICH IS AVAILABLE ON RECORD AND WHICH HAS NOT BEEN CONTROVERTED BY THE ASSESSEE EITHER DURING THE ASSESSMENT OR APPELL ATE PROCEEDINGS. DURING THESE PROCEEDINGS, THE CONTENTION OF THE ASSESSEE A LL ALONG HAS BEEN TO REJECT ITS BOOKS OF ACCOUNTS AND ESTIMATE THE NET PROFIT. AS WE HAVE HELD ABOVE, THE PROVISIONS OF SECTION 145(3) ARE TO BE EXERCISED BY THE AO WHERE THE AO IS OF THE OPINION THAT THE BOOKS OF ACCOUNTS ARE NOT RELI ABLE AND ARE TO BE REJECTED. SUCH EXERCISE OF REJECTION OF BOOKS OF ACCOUNTS CAN NOT AND SHOULD NOT BE AT THE REQUEST OF THE ASSESSEE AND MORE SO, FOR THE BE NEFIT OF THE ASSESSEE ESPECIALLY WHERE THERE IS SPECIFIC MATERIAL AND FIN DINGS ON RECORD TO MAKE SPECIFIC DISALLOWANCES/ADDITIONS IN VIEW OF NON-FUL FILMENT OF CONDITIONS SPECIFIED THEREIN. 29. NOW COMING TO SPECIFIC DISALLOWANCES/ADDITIONS MADE BY THE AO. THE AO HAS MADE THE ADDITION TOWARDS THE UNEXPLAINED EX PENDITURE U/S 69C AMOUNTING TO RS 20,88,402, DIFFERENCES IN LEDGERS U /S 69B AMOUNTING TO RS 28,30,670, TRANSPORTATION CHARGES PAID TO VARIOUS T RUCK OWNERS FOR SUPPLY OF BALLAST/GRIT TO RAILWAY U/S 69C AMOUNTING TO RS 3,0 0,000, ADDITION ON ACCOUNT OF NON-DEDUCTION OF TDS ON LABOUR & TRANSACTIONS U/ S 40(A)(IA) AMOUNTING TO RS 27,15,203, ADDITION UNDER SECTION 40A(3) AMOUNTI NG TO RS 36,45,562. THE ASSESSEE HAS NOT DISPUTED THE NATURE, QUANTUM A ND INCURRENCE OF THE EXPENDITURE BUT COULD NOT OFFERED ANY EXPLANATION R EGARDING THE SOURCE OF THE ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 19 EXPENDITURE WHICH HAS NOT BEEN RECORDED IN THE BOOK S OF ACCOUNTS AND THE SAME HAS BEEN RIGHTLY BROUGHT TO TAX UNDER SECTION 69C OF THE ACT AND WHICH COULD BE RECONCILED AND BROUGHT TO TAX UNDER SECTIO N 69B OF THE ACT. SIMILARLY, THE ASSESSEE HAS NOT DISPUTED THE PAYMEN TS WHICH ARE LIABLE FOR TDS AND GIVEN THAT, THE ASSESSEES CONTENTION THAT THERE ARE NO WRITTEN/VERBAL CONTRACTS HAS BEEN RIGHTLY REJECTED BY THE AO AND P ROVISIONS OF SECTION 40(A)(IA) HAS BEEN RIGHTLY INVOKED. REGARDING CASH PAYMENT AND VIOLATION OF SECTION 40A(3), THE AO HAS GIVEN A SPECIFIC FINDING THAT THE PERSONS TO WHOM CASH HAS BEEN PAID HAS ALSO BEEN PAID THROUGH ACCOU NT PAYEE CHEQUES AND THE ASSESSEE HAS OFFERED NO EXPLANATION AS TO THE R EASONS AND THE CIRCUMSTANCES UNDER WHICH CASH PAYMENT HAS BEEN MAD E. IN VIEW OF LACK OF EXPLANATION ON THE PART OF THE ASSESSEE REGARDING T HE SOURCE OF EXPENDITURE AS PER SPECIFIC PROVISIONS OF SECTION 69B AND 69C A ND VIOLATION OF PROVISIONS OF SECTION 40(A)(IA) ON ACCOUNT OF NON-DEDUCTION OF TD S AND SECTION 40A(3) OF THE ACT ON ACCOUNT OF PAYMENT IN CASH BEYOND THE PR ESCRIBED THRESHOLD, THE ADDITIONS SO MADE BY THE AO ARE HEREBY CONFIRMED. 30. REGARDING OTHER EXPENSES NAMELY EXCESSIVE/ BOG US EXPENSES AMOUNTING TO RS 2,63,189, UNRECORDED MARBLE AND GRA NITE PURCHASE OF RS 98,948, UNRECORDED PURCHASES/LABOUR AND TRANSPORTAT ION CHARGES OF LIME AMOUNTING TO RS 8,49,286, UNEXPLAINED EXPENSES AMOU NTING TO RS 1,14,800, UNEXPLAINED EXPENSES BEING REPAIR & MAINTENANCE OF PLANT AND MACHINERY AMOUNTING TO RS 2,64,877, UNEXPLAINED TRANSPORTATIO N EXPENSES AMOUNTING TO RS 6,49,962, THE ASSESSEE HAS AGAIN FAILED TO OFFER ANY EXPLANATION IN SPITE OF SPECIFIC SHOW-CAUSE BY THE AO AND THE ADDITIONS HAV E RIGHTLY BEEN MADE BY THE AO WHICH ARE HEREBY CONFIRMED. GROUND NO. 3 (O THER THAN IT RELATES TO UNRECORDED SALES/RECEIPTS/INCOME DISCUSSED SUBSEQUE NTLY), GROUND 4 RELATING TO ADDITIONS U/S 40(A)(IA) AND GROUND NO. 6 RELATIN G TO ADDITIONS U/S 40A(3) ARE THUS ALLOWED IN FAVOUR OF THE REVENUE AND THE F INDINGS OF THE LD CIT(A) ARE SET-ASIDE. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 20 SUPPRESSED PRODUCTION AND UNRECORDED SALES/RECEIPTS /INCOME 31. GROUND NO. 2 RELATES TO ADDITION ON ACCOUNT OF SUPPRESSED PRODUCTION OF BALLAST FROM DABORA AND SALES THEREOF. GROUND N O. 3 RELATES TO UNRECORDED SALES OF GRIT OF RS 14,02,856, UNRECORDED LOADING R ECEIPTS FROM RAILWAYS OF RS 1,95,889, UNRECORDED SALES OF MARCH 2009 OF DABORA/ BALLAST TO RAILWAY OF RS 12,27,248, UNRECORDED INCOME FROM CRUSHER HIRE CHAR GES OF RS 10,000, UNRECORDED SALES AS PER ANNEXURE-17 OF RS 1,44,325. GROUND NO. 5 RELATES TO ADDITION ON ACCOUNT OF UNDISCLOSED RECEIPT OF LEASE RENT OF RS 93,000. GROUND NO. 8 RELATES TO ADDITION ON ACCOUNT OF UNDISCLOSED INTEREST INCOME OF RS 72,000 AND GROUND NO. 9 RELATES TO ADDITION ON ACCO UNT OF LOSS IN MARBLE & GRANITE TRADING OF RS 1,43,799. 32. FIRSTLY, IN GROUND NO. 2, THE REVENUE HAS CHAL LENGED THE ACTION OF THE LD CIT(A) IN DELETING THE ADDITION OF RS. 18,94,463/- OUT OF TOT AL ADDITION OF RS. 54,95,595/- MADE BY A.O. ON ACCOUNT OF SUPPRESSED P RODUCTION OF BALLAST FROM DABORA AND SALES THEREOF. 33. BRIEFLY THE FACTS OF THE CASE ARE THAT THE AO M ADE THE ADDITION OBSERVING AS UNDER:- DURING THE ASSESSMENT PROCEEDINGS, IT WAS NOTICED THAT THERE IS A HUGE DIFFERENCE BETWEEN ASSESSEES PURCHASES OF DABORA AND BALLAST PRODUCTION SHOWN AND SOLD BY THE ASSESSEE WHICH INDICATES THAT THERE IS HUGE SUPPRESSED SALES. VIDE QUESTIONNAIRE DATED 25.06.12 IT WAS CON FRONTED TO THE ASSESSEE THAT HE HAS SOLD 26017.459 M. TONS OF GRIT/DABORA TO RAILWAY DURING THE YEAR, WHICH IS EVIDENT FROM YOUR SALES BILLS OF THE ASSESSEE. BESIDES THIS YOU HAVE SOLD 5748.840 TONS (143721)CFT) GRIT TO OTHERS AS PER RECASTED BOOKS OF ACCOUNT. IN THIS WAY YOU HAVE SOLD 31766.299M. TONS GRIT/DABORA DURING THE YEAR. THE PURCHASE OF DABORA FOR THE PERIOD 1-04-20 08 TO 30-09-2008 COMES TO 11825 M. TONS. THE DABORA PURCHASES IN THE PERIO D 01.10.2008 TO ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 21 31.03.2009 COME TO 42770 M. TONS. SO THE TOTAL DABO RA PURCHASES FOR THE YEAR COME TO 54595 M. TONS. YOU HAVE ALSO PURCHASED 1621 M.T. BALLAST IN PERIOD UP TO 30.09.2008 AND 4140 M.T. FROM 01.10.20 08. YOU HAVE SOLD 31766.299 M. TONS BALLAST. IN THIS WAY YOU HAVE NOT SHOWN THE SALES FOR THE BALANCE BALLAST/GRIT PROCURED FROM DABORA. PLEASE C LARIFY THAT HOW MUCH GRIT HAS BEEN PROCURED BY YOU FROM DABORA DURING THE YEA R AS CORRECT SALES COULD BE DETERMINED. AFTER DEDUCTING 31766.299 M.TONS FROM ABOVE PRODUCT ION THE BALANCE IS YOUR SUPPRESSED SALES & THESE SALES ARE YOUR PROFIT AS P URCHASES AND EXPENSES OF THE SAME HAS ALREADY BEEN DEBITED BY YOU AND THERE IS NO CLOSING STOCK OF DABORA/ GRIT PLEASE FILE YOUR EXPLANATION IN THIS R EGARD. IN THIS REFERENCE THE ASSESSEE IN HIS REPLY DATED 1 8.07.2012 SUBMITTED THAT WE SUBMIT OUR GITTI/DABORA SALES DURING FY 2008-09 IS RS. 9671086/- WHEREAS DURING FY 2009-10 IT IS RS. 1,79,90,046/-. IN FY 20 08-09 OUR DISCLOSED NP IS RS. 10,95,464/- WHICH IS RS. 1447526/- IN FY. 2009- 10. RATE OF TAX BOTH IN A.Y. 2009-10 & 2010-11 IS SAME. THERE IS THEREFORE NO REASON FOR SUPPRESSION OF ANY INCOME IN A.Y. 2009-10 AND PAY TAX THEREON I N A.Y. 2010-11. WE, HOWEVER, SUBMIT THAT IF ON THIS ACCOUNT ANY ADDITIO N IS MADE, IT SHOULD BE @ 6% OF DEEMED DISCLOSED SALES AND ITS CORRESPONDING RELIEF BE PROVIDED IN NEXT YEAR I.E. A.Y. 2010-11 WHEREFROM PROFIT SO WORKED O UT BE REDUCED. FURTHER VIDE THIS OFFICE LETTER DATED 02.08.2012 TH E ASSESSEE WAS ASKED THAT HE HAS NOT REPLIED O THE QUERY NO. 12 OF THIS OFFIC ES QUESTIONNAIRE DATED 25.06.2012 VIDE WHICH IN NUT SHELL IT WAS ASKED THA T OUT OF TOTAL PURCHASES OF 60356 M.TONS DABORA/BALLAST YOU HAVE SOLD 31766.299 M.TONS AS PER RECASTED BOOKS AND YOU HAVE SUPPLIED 3339.450 M.TON S IN THE MONTH OF MARCH 2009 AS DISCUSSED IN PARA 2 OF LETTER DATED 0 2.08.2012. THEREFORE, TOTAL ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 22 SALES OF DABORA/BALLAST COMES TO 35105.749 M.TONS. IT MEANS 25250.251 M.TONS IS YOUR SUPPRESSED SALES VALUE OF WHICH @ 36 7.50 PER M.TONS COMES TO RS. 92,79,467/-. PLEASE EXPLAIN WHY THE SAME SHO ULD NOT BE ADDED AS YOUR INCOME OF A.Y. 2009-10? IN THIS REFERENCE, THE ASSESSEE SUBMITTED HIS WRITT EN REPLY DATED 06.08.2012 STATING THEREIN THAT TOTAL DABORA PURCHASED BY US I S 54595 M.TON AND BALLAST PURCHASED BY US IS 5761 M.TON, THUS TOTAL PURCHASES OF 60356 M.TON. AGAINST IT WE HAD MADE GITTI SALE 31766.299 M.TON ONLY WHER EIN IF SALES MADE IN MARCH AT 3339.450 M.TON NOT SHOWN BY US IN ACCOUNT IS ALSO INCLUDED, THIS WILL BRING TOTAL TO 35105.749 M.TON ONLY MEANING TH ERE IS GAP OF 25250.251 M.TON WHICH IS, IN CONSONANCE TO YOUR LETTER, OUR S UPPRESSED SALES AND FURTHER HE HAS REQUESTED TO CALCULATE PRODUCTION OF 60% BAL LAST FROM DABORA FOR WHICH AGAIN A LETTER WAS ISSUED TO THE ASSESSEE FOR REJECTION OF HIS SUBMISSION OF 60% PRODUCTION FOR WHICH HE HAS AGAIN SUBMITTED TO ACCEPT THE SAME. THE ASSESSEE HAS SUSPECTED THE QUANTITIES OF DABORA PUR CHASED AND QUANTITY OF BALLAST SALES COMMUNICATED TO HIM THE QUERY LETTER BUT IT WAS CLARIFIED TO HIM THAT IN RECASTED BOOKS THE AUDITORS HAS GIVEN DAY T ODAY QUANTITY OF PURCHASES AND SALES WHICH IS BASED ON IMPOUNDED ANNEXURES AND PURCHASE VOUCHERS WHICH HAS BEEN EXAMINED DURING THE COURSE OF ASSESS MENT PROCEEDINGS, SO NO DISPUTE ABOUT THE QUANTITY AND VALUE OF PURCHASES A ND SALES REMAINS. WHILE GOING THROUGH THE SALE BILLS OF THE ASSESSEE, IT HAS BEEN GATHERED THAT ASSESSEE HAS COLLECTED SALES TAX @ 12.50 PER M.TON ON SUPPLY TO RAILWAY BECAUSE THE SALES TAX IS RS. 12.50 PER M.TON ON SAL ES ON GRIT FROM OTHER PERSONS. AS PER SALES TAX ACT PREVAILING IN THIS PE RIOD, THE SALES TAX WAS RS. 12.50 PER M.TON ON BALLAST AND RS. 20 PER M.TON ON GRIT. IT PROVES THAT ASSESSEE HAS SOLD BALLAST TO RAILWAY AND NOT THE GR IT. HERE IT IS PERTINENT TO SAY THAT BALLAST WHICH HAS BEEN SUPPLIED BY THE ASS ESSEE TO THE RAILWAY IS OF ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 23 BIG SIZE THAT NORMAL GRIT SIZE AND THE CHANCES OF WASTAGES IS NEGLIGIBLE IN PRODUCTION OF BALLAST IN COMPARISON TO GRIT. AFTER CONSIDERING THE ASSESSEES SUBMISSIONS AND CIRCUMSTANCES OF THE CASE I AM OF T HE VIEW THAT THE ASSESSEE HAS PROCURED 80% BALLAST FROM THE DOBARA, WHICH WIL L COVER ALL THE DEFICIENCIES IF ANY, OCCURRED DURING THE TRANSPORTA TION, UNLOADING OF STACKING OF BALLAST AT RAILWAY SITE. DABORA PURCHASES 54595 M.TONS DURING THE YEAR THE PRODUCTION AT 80% COMES TO 43676 M.TONS DURIN G THE YEAR THE ASSESSEE HAS ALSO PURCHASED BALLAST 5761 M.TONS DURING THE YEAR TOTAL BALLAST AVAILABLE 49437 M.TONS THE ASSESSEE HAS SOLD 26017 M.TONS TO RAILWAY UPTO FEB. 2009 THE ASSESSEE HAS SOLD 5749 M.TONS TO PERSONS OTHER THAN RAILWAY THE ASSESSEE HAS SOLD 2717 M.TONS TO RAILWAY IN MA RCH 2009 TOTAL SALES 34483 M.TONS IN THIS WAY, THE ASSESSEE HAS SUPPRESSED THE SALES OF 14954 TONES. THE ASSESSEE HAS NOT SHOWN THE CLOSING STOCK OF THE DOB ARA/BALLAST SO 14954 M.TONS BALLAST IS SUPPRESSED SALES OF THE ASSESSEE. THE ASSESSEE HAS SOLD BALLAST TO THE RAILWAY @ 367.50 PER M.TON SO THE TO TAL VALUE COMES TO RS. 54,95,595/- WHEN THE ASSESSEE HAS DEBITED THE EXPE NDITURE UPTO MARCH 2009 RELATING TO MANUFACTURING/ TRANSPORTATION FOR THESE SALES & HE WAS MAINTAINING HIS BOOKS OF ACCOUNT ON MERCANTILE BASIS AND ASSESS EE HAS NOT SHOWN ANY CLOSING STOCK OF DABORA/BALLAST, SO THE TOTAL SUPPR ESSED SALES OF RS. 54,95,595/- IS ADDED AS INCOME OF THE ASSESSEE OF A .Y. 2009-10. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 24 34. WE HAVE GONE THROUGH THE FINDINGS OF THE LD CI T(A) AND THE SAME REMAIN UNCONTROVERTED BEFORE US. THE FOLLOWING FIN DINGS OF THE LD. CIT(A) ARE HEREBY CONFIRMED: THE A.O. ESTIMATED PRODUCTION OF 80% FROM DABORA PURCHASE WHEREAS THE ASSESSEE STATED THAT THE PRODUCTION VARIES BETWEEN 60 TO 75%. THE ASSESSEE ALSO CONTENDED THAT IT HAS SOLD GRIT TO RAILWAYS IN CUBIC METER AND THE A.O. HAS CONVERTED THE SAME TO METRIC TON BY APPLYING WR ONG CONVERSION FACTOR. AS PER ASSESSEE IT HAS SOLD 24,569.566 CUBIC METER TO RAILWAYS. ONE CUBIC METER IS EQUIVALENT TO 35.31 CUBIC FT. WHICH GIVES A FIGU RE OF 8,67,551.38 CUBIC FIT (35.31X24,569.566). ACCORDING TO ASSESSEE 25.6 CUBI C FT. IS EQUIVALENT TO 1 METRIC TON WHICH GIVES A FIGURE OF 33,888.73 METRIC TON ( 8,67,551.38/25.6) I HAVE VERIFIED THE REQUIRED DENSITY FOR RAILWAY BA LLAST AND IT WAS FOUND THAT THE SAME SHOULD NOT BE LESS THAN 1200 KG/CU.M. THE ASSESSEES FIGURE GIVES A DENSITY OF 1379.29KG/CU. M (33888.73*1000/24569.566 KG/CU.M). THEREFORE THE CONVERSION FIGURE IS ACCEPTABLE. AFTE R ACCEPTING THE CONVERSION FIGURE THE TOTAL SALES OF BALLAST COMES TO 39638 ME TRIC TON (INCLUDING SALES TO OTHERS) ONLY. THE ASSESSEE CLAIMED THAT THE PRODUCT ION OF GRIT IS BETWEEN TO 60 TO 75%. HOWEVER, THE ASSESSEE FAILED TO CHALLENG E THE FINDING OF A.O. THAT THE ASSESSEE HAS SUPPLIED BALLAST TO RAILWAY AND NO T GRIT. IN THE CASE OF BALLAST, THE PRODUCTION IS ON HIGHER SIDE AS THERE IS LESSER WASTAGE IN THE PRODUCTION OF BALLAST. CONSIDERING THIS FACT, I EST IMATE A PRODUCTION OF 80% OF THE DABORA PURCHASES. ACCORDINGLY, THE EXCESS PRODUCTION IS COMPUTED AS U NDER:- DOBARA PURCHASES 54595 M.TON 80% PRODUCTION THEREOF I.E. 43676 M.TON ADD. BALLAST PURCHASED FROM OTHERS 5761 M.TON TOTAL BALLAST AVAILABLE 49437 M.TON BALLAST SOLD TO OTHERS 5749 M.TON ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 25 BALLAST SOLD TO RAILWAY 33889 M.TON UPTO 20.02.2009 (AS ABOVE) ----------------------- --- TOTAL: 39638 M.TON ------------------------ THIS GIVES A DIFFERENCE OF 9799 METRIC TON. TAKING THE VALUE OF SALE AT RS. 367.5 PER METRIC TON, THE SUPPRESSED SALE FIGURE CO MES TO RS. 36,01,132/-. THE SAME IS CONSIDERED AS UNDISCLOSED TURNOVER OF A SSESSEE AND USED FOR COMPUTING THE INCOME OF ASSESSEE. THIS GROUND OF AP PEAL IS THEREFORE TREATED AS PARTLY ALLOWED. 34.1 GROUND NO. 2 OF THE REVENUE IS THEREFORE DISMI SSED. 35. IN GROUND NO. 3, THE REVENUE HAS CHALLENGED TH E DELETION OF ADDITION ON ACCOUNT OF UNRECORDED SALES OF GRIT OF RS 14,02, 856, UNRECORDED LOADING RECEIPTS FROM RAILWAYS OF RS 1,95,889, UNRECORDED S ALES OF MARCH 2009 OF DABORA/BALLAST TO RAILWAY OF RS 12,27,248, UNRECORD ED INCOME FROM CRUSHER HIRE CHARGES OF RS 10,000, UNRECORDED SALES AS PER ANNEXURE-17 OF RS 1,44,325. THE TOTAL UNDISCLOSED TURNOVER THEREFORE COMES TO RS 30,69, 266. 36. THE LD CIT(A) AFTER TAKING INTO CONSIDERATION THE SUPPRESSED SALES ON ACCOUNT OF UNDISCLOSED PRODUCTION OF RS. 36,01,132/ - AS DECIDED ABOVE, HAS GIVEN A BENEFIT OF TELESCOPING TO THE ASSESSEE AND HAS BROUGHT TO TAX THE UNDISCLOSED SALE FIGURE AT AT RS. 36,01,132/- BEING HIGHER OF THE TWO. WE DONOT SEE ANY INFIRMITY IN THE SAME AND THE SAID FI NDING OF THE LD CIT(A) IS HEREBY CONFIRMED. GROUND NO. 3 TO THIS LIMITED EXT ENT IS DISMISSED. 37. IN GROUND NO. 5, THE REVENUE HAS CHALLENGED TH E DELETING OF ADDITION OF RS. 93,000/- MADE BY A.O. ON ACCOUNT OF UNDISCLOSED RECEIPT OF LEASE RENT. AS ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 26 PER LD. CIT(A), AS THE ASSESSEE HAS ALREADY SHOWN L EASE RENT IN THE PROFIT & LOSS ACCOUNT, THERE IS NO NEED FOR MAKING ANY SEPAR ATE ADDITION AND THE A.O. WAS DIRECTED TO DELETE THE ADDITION. WE DONOT SEE A NY INFIRMITY IN THE ORDER OF LD CIT(A) AND THE SAME IS HEREBY CONFIRMED AND THE GROUND OF APPEAL NO. 5 IS DISMISSED. 38. IN GROUND NO. 8, THE REVENUE HAS CHALLENGED TH E DELETION OF ADDITION OF RS. 72,000/- MADE BY A.O. ON ACCOUNT OF UNDISCLOSED INTEREST INCOME ON LOAN OF RS. 3.00 LAC GIVEN BY THE ASSESSEE TO SHRI MAHAV IR SUMAN. 39. THE RELEVANT FINDING OF THE LD. CIT(A) IS AS UN DER:- I AGREE WITH THE SUBMISSION OF THE ASSESSEE THAT T HERE WAS A TYPOGRAPHIC ERROR IN THE AGREEMENT INSTEAD OF 3, A FIGURE OF 30 WAS WRONGLY TYPED. THE AMOUNT OF LOAN IS CLEARLY MENTIONED IN FIGURE AND WORDS AND THE SAME STOOD AT RS. 30,000/- ONLY. THEREFORE THE A.O. IS DIRECTE D TO DELETE ADDITION OF RS. 72,000/-. THIS GROUND OF APPEAL IS THEREFORE ALLOWE D. 40. WE DO NOT SEE ANY INFIRMITY IN THE ORDER OF LD CIT(A) AND THE SAME IS HEREBY CONFIRMED AND THE GROUND OF APPEAL NO. 8 IS DISMISSED. 41. IN GROUND NO. 9, THE REVENUE HAS CHALLENGED TH E DELETION OF ADDITION OF RS. 1,43,799/- MADE BY A.O. ON ACCOUNT OF LOSS IN M ARBLE & GRANITE TRADING AS THE A.O. HAD NEITHER REJECTED BOOKS OF ACCOUNT OF T HE ASSESSEE NOR ESTIMATED INCOME BY APPLYING NET PROFIT RATE ON SALES. 42. THE RELEVANT FINDING OF THE LD. CIT(A) IS AS UN DER:- AS THE INCOME OF ASSESSEE IS ESTIMATED BY APPLYING NET PROFIT RATE THEREFORE, THERE IS NO NEED TO SEPARATELY DISALLOW LOSS IN MAR BLE AND GRANITE ACCOUNT. THE A.O. IS THEREFORE DIRECTED TO DELETE ADDITION O F RS. 1,43,799/-. THIS GROUND OF APPEAL IS THEREFORE ALLOWED. 43. AS WE HAVE HELD ABOVE, BOOKS OF ACCOUNTS HAVE NOT BEEN REJECTED IN THE INSTANT CASE, THEREFORE THERE IS NO BASIS TO ES TIMATE NET PROFIT. WE HAVE ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 27 PURSUED THE MATERIAL AVAILABLE ON RECORD. THE FINDI NGS OF THE AO REMAIN UNCONTROVERTED BEFORE US AND THE SAME ARE HEREBY CO NFIRMED. IN THE RESULT, GROUND OF APPEAL NO. 9 IS ALLOWED. 44. IN GROUND NO. 10, THE REVENUE HAS CHALLENGED T HE DELETION OF ADDITION OF RS. 5,03,251/- OUT OF TOTAL ADDITION OF RS. 8,67 ,670/- MADE BY A.O. ON ACCOUNT OF PEAK OF NEGATIVE CASH BALANCE SINCE THE DECISION OF LD. CIT(A) REJECTING THE BOOKS OF ACCOUNT OF THE ASSESSEE AND ESTIMATING UNDISCLOSED INCOME OF THE ASSESSEE AT RS. 5,03,251/- BY APPLYIN G NET PROFIT RATE HAS NOT BEEN ACCEPTED BY THE DEPARTMENT. 45. THE RELEVANT FINDING OF THE LD. CIT(A) IS AS UN DER:- CONSIDERING THE ABOVE THE REPLY OF THE ASSESSEE CA NNOT BE ACCEPTED AND ON MERITS THE FINDINGS OF A.O. IS CONFIRMED. HOWEVER, IT WOULD BE FAIR AND JUSTIFIED, IF ASSESSEE IS ALLOWED BENEFIT OF TELESC OPING. I HAVE CONFIRMED ADDITION OF RS. 1,43,138/- ON DISCLOSE SALE AND RS. 3,60,113/- ON UNDISCLOSED SALES, TOTALLING TO RS. 5,03,251/-. IT IS THEREFOR E HELD THAT THIS ADDITIONAL AMOUNT WAS AVAILABLE WITH ASSESSEE AND TO THE EXTEN T OF THIS AMOUNT NEGATIVE CASH BALANCE IS TREATED AS EXPLAINED. IN THE RESULT , ADDITION OF RS. 3,64,419/- (8,67,670-5,03,251) IS CONFIRMED. THE A.O. IS DIREC TED TO DELETE BALANCE ADDITION OF RS. 5,03,251/-. THIS GROUND OF APPEAL I S THEREFORE PARTLY ALLOWED. 46. WE HAVE PURSUED THE MATERIAL AVAILABLE ON RECO RD AND THE FINDINGS OF THE LD CIT(A). THE ASSESSEE IS ALLOWED THE BENEFIT OF TELESCOPING ON ACCOUNT OF ADDITIONS SUSTAINED ABOVE WHICH IS HIGHER THAN T HE ADDITION OF RS. 8,67,670/-. IN THE RESULT, GROUND OF APPEAL NO 10 I S DISMISSED. 47. IN GROUND NO. 1, THE REVENUE HAS CHALLENGED TH E ACTION OF THE LD CIT(A) IN DELETING THE ADDITION OF RS. 1,07,656/- MADE BY A.O. ON ACCOUNT OF UNEXPLAINED DIFFERENCES IN OPENING BALANCES OF DEBT ORS AND CREDITORS ON PROTECTIVE BASIS. AS PER THE LD CIT(A), THE AO HAS NOT GONE INTO MERITS OF THE ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 28 CASE AND AS THE DIFFERENCE DID NOT RELATE TO THE YE AR UNDER CONSIDERATION, THE A.O. WAS DIRECTED TO DELETE THE ADDITION. WE DONOT FIND ANY INFIRMITY IN THE ORDER OF THE LD CIT(A) AND THE SAME IS CONFIRMED. THE GROUND OF APPEAL NO 1 IS DISMISSED. 48. IN GROUND NO. 7, THE REVENUE HAS CHALLENGED TH E DELETION OF ADDITION OF RS. 2,45,000/- OUT OF TOTAL ADDITION OF RS. 4,16,00 0/- MADE BY A.O. ON ACCOUNT OF DIFFERENT IN DATES OF ENTRIES OF CASH IN BANK ST ATEMENTS VIS-A-VIS CASH BOOK. 49. BRIEFLY THE FACTS OF THE CASE ARE THAT THE A.O. MADE ADDITION OF RS. 4,16,000/- OBSERVING AS UNDER:- DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WA S NOTICED THAT THERE ARE SOME DIFFERENCES IN DATE OF CASH ENTRIES WRITTEN IN THE FINAL BOOKS OF ACCOUNT AND RECASTED BOOKS OF THE ASSESSEE ON THE BASIS OF BANK STATEMENTS WHICH EFFECTS THE CASH BALANCE POSITION OF BOOKS OF ACCOU NT. THE ASSESSEE WAS ASKED TO FURNISH HIS EXPLAIN AS TO WHY THE TOTAL AM OUNT OF RS. 4,16,000/- OF FOUR BANK ENTRIES SHOULD NOT BE ADDED AS HIS INCOME FROM UNDISCLOSED SORUCES? FOLLOWING ARE THE DIFFERENCES:- A. THE ASSESSEE HAS GIVEN A SUM OF RS. 1.00 LAC ON 22.05.08 FROM PUNJAB NATIONAL BANK ACCOUNT NO 7363 TO SWASTIK STONE CRUS HER AS PER BOOK STATEMENT & IN IMPOUNDED ANNEXURE-30, IT IS WRITTEN AS PAID TO SWASTIK STONE CRUSHER BY SELF CHEQUE. THE ASSESSEE HAS SHOWN IT A S CASH WITHDRAWAL IN HIS AUDITED BOOKS OF ACCOUNT. ASSESSEE FILED REPLY STATING THEREIN THAT PAYMENT O F RS. 100000/- WAS INTENDED TO BE PAID TO SWASTIK CRUSERS BUT IT WAS N OT PAID AND MONEY WITHDRAWN FROM BANK ON STRENGTH OF BEARER WAS TAKEN IN CASH BOOK. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 29 I HAVE GONE THROUGH THE REPLY OF THE ASSESSEE AND T HE SAME IS NOT FOUND TENABLE, BECAUSE THE PAYMENT OF RS. 1.00 LAC WAS MA DE BY THE ASSESSEE TO M/S SWASTIK STONE CRUSHER BUT LATER ON, THE ASSESSE E HAS ENTITLED THIS AMOUNT IN HIS CASH BOOK TO INCREASE HIS CASH BALANCE. THIS CASH BALANCE WAS INTRODUCED BY THE ASSESSEE IN HIS CASH BOOK OUT OF HIS INCOME FROM UNDISCLOSED SOURCES. THEREFORE, THE SAME IS ADDED T O THE TOTAL INCOME OF THE ASSESSEE. B. THE ASSESSEE HAS GIVEN A CHEQUE OF RS. 21,000/- TO PATEL TYRES ON 13.08.08 FROM BANK A/C NO. 8034 OF PNB AS EVIDENT F ROM ANN- 30. THE ASSESSEE HAS SHOWN IT AS CASH WITHDRAWAL IN HIS AUD ITED BOOKS OF ACCOUNT. ASSESSEE FILED REPLY STATING THAT TYRES FOR TRUCK W ERE INTENDED TO BE PURCHASED FROM PATEL TYRES, AND CHEQUE WAS PREPARED, HOWEVER NEITHER TYRES WERE PURCHASED NOR PAYMENT WAS MADE AND THEREFORE MONEY WITHDRAWN FROM BANK ON STRENGTH OF BEARER CHEQUE WAS TAKEN IN CASH BOOK . I HAVE GONE THROUGH THE REPLY OF THE ASSESSEE AND H AVE NOT FOUND IT AS TENABLE, BECAUSE THE ASSESSEE HAS OPTED SOME OPERAN DI, AS HE HAS TAKEN ABOVE, AND SIMILARLY HE HAS MADE PAYMENT OF RS. 21, 000/- TO PATEL TYRES ON 13.08.2008 BUT SIMULTANEOUSLY, HE ENTERED THIS CASH IN HIS CASH BOOK ALSO ACTUALLY, THIS CASH WAS EARNED BY ASSESSEE FROM HIS UNDISCLOSED SOURCES, THEREFORE, IT IS ADDED TO HIS TOTAL INCOME. C. THE ASSESSEE HAS GIVEN A CHEQUE OF RS. 50,000/- ON 12.08.2008 FROM BANK A/C NO. 8034 PNB TO S.S. PILLAY, BARODA WHICH IS EV IDENT FROM BANK STATEMENT. THE ASSESSEE HAS SHOWN IT AS CASH WITHDRAWAL IN HIS AUDITED BOOKS OF ACCOUNT. ASSESSEE FILED REPLY STATING THAT FROM S.S. ILLAY, BARODA, MACHINE PARTS WERE TO BE PURCHASED. HOWEVER, NEITHER IT WAS PURCHASED NOR PAYMENT WAS MADE AND ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 30 THEREFORE MONEY WITHDRAWN FROM BANK ON STRENGTH OF BEARER CHEQUE WAS TAKEN IN CASH BOOK. AFTER GOING THROUGH THE REPLY OF THE ASSESSEE, I HA VE FOUND NO MERIT IN IT BECAUSE THE ASSESSEE HAS OPTED SAME MODUS OPERANDI AS DESCRIBED IN EARLIER PARA AND HE MADE A PAYMENT OF RS. 50,000/- ON 12.08 .2008 TO S.S.PILLAY, BARODA THROUGH CHEQUE BUT ON OTHER HAND HE DIVERTED THE CASH OF RS. 50,000/- TO HIS CASH BOOK. THIS AMOUNT OF RS. 50,00 0/- IS ADDED TO THE TOTAL INCOME OF THE ASSESSEE BEING EARNED FROM UNDISCLOSE D SOURCES. D. THE ASSESSEE HAS WITHDRAWN RS. 2,45,000/- FROM P UNJAB NATIONAL BANK A/C NO. 8034 ON 03.03.09 AS CASH AS IS EVIDENT FROM BAN K STATEMENT. IN THE BOOKS OF ASSESSEE, HE HAS ENTERED THIS ENTRY ON 02. 02.09. HOW IT WAS ENTERED ONE DAY BEFORE THE WITHDRAWAL IN THE BOOKS OF ACCOU NT, IS UNIMAGINABLE. ASSESSEE FILED REPLY STATING THAT BECAUSE OF MISTAK E OF OUR ACCOUNTANT THIS ENTRY OF RS. 245000/- AS CASH WITHDRAWN FROM BANK W AS MADE ON 02.03.2009 I.E. ONE DAY EARLIER. HOWEVER ITS USE WAS NOT MADE BY US BECAUSE WE HAD RS. 372111/- CASH IN HAND WITH US EXCLUDING RS. 245000/ - ON 02.03.2009. I HAVE GONE THROUGH THE REPLY OF THE ASSESSEE AND H AVE NOT FOUND IT AS TENABLE, BECAUSE HE HAS INTRODUCED RS. 2,45,000/- F ROM HIS UNDISCLOSED SOURCES OF INCOME ON 02.03.2009 IN HIS CASH BOOK AS AGAINST WITHDRAWAL MADE FROM BANK ON 03.03.2009. THE ASSESSEES STATEMENT T HAT HE HAS SUFFICIENT CASH BALANCE IN HIS CASH BOOK ON THAT DAY AND HE DI D NOT UTILIZE THIS CASH TILL THE DATE OF WITHDRAWAL FROM BANK DOES NOT JUSTIFY H IS CLAIM THAT HE DID NOT MAKE ANY ANY MISTAKE AND HOW IT WAS POSSIBLE THAT W ITHOUT WITHDRAWING MONEY FROM BANK, HE ENTERED THIS CASH IN HIS CASH B OOK ON AN EARLIER DATE. THEREFORE, RS. 2,45,000/- IS ADDED TO THE ASSESSEE S INCOME FROM UNDISCLOSED SOURCES. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 31 AS DISCUSSED ABOVE IN PARAS A TO D, AFTER GOING THR OUGH THE REPLY OF ASSESSEE, IT IS NOT FOUND TENABLE BECAUSE SUBMISSION PUT FORT H BY THE ASSESSEE IS NOT RELIABLE BEING THERE ARE SO MANY WRONG/SUPPRESSED S ALES & PURCHASES AND INFLATED EXPENSES ENTERED IN THE BOOKS OF ACCOUNT O F THE ASSESSEE. LOOKING TO FACTS AND CIRCUMSTANCES OF THE CASE, AN AMOUNT OF R S. 4,16,000/- (100000 + 21000 + 50000 + 245000) RELATING TO PARAS A TO D AB OVE IS HEREBY ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 50. THE COMMENT OF THE AO IN THE REMAND REPORT CAL LED BY THE LD CIT(A) ARE REPRODUCED BELOW: I) THE SUBMISSION AND CERTIFICATE SUBMITTED BY THE APP ELLANT IS BASELESS MISLEADING AND FALSE. I AM ENCLOSING HEREWITH THE P HOTOCOPY OF ANNEXURE- 1 (PAGE NO. 26) IN WHICH IT IS CLEARLY MENTIONED TH AT THIS PAYMENT HAS BEEN RECEIVED BY SWASTIK CRUSHER BY SELF CHEQUE WHI CH IS MARKED NOW AS EXHIBIT ......B. II) THE PAYMENT OF RS. 21,000/- HAS BEEN MADE BY TH E APPELLANT BY CHEQUE TO PATEL TYRES. I AM ENCLOSING HEREWITH THE PHOTOCO PY OF ANNEXURE-30 PAGE NO. 11 WHICH IS NOW MARKED AS EXHIBIT.....C AN D THIS IS NOT CASH WITHDRAWAL MADE BY THE APPELLANT. HERE THE APPELLAN T IS MISLEADING YOUR HONOUR BY SAYING THAT HE HAS NOT MADE THE PAYMENT T O PATEL TYRE AND THIS IS A WITHDRAWAL IN CASH FROM BANK. THE APPELLANT HAS ALSO MADE PAYMENT OF RS. 50,000/- BY CHEQUE TO M/S S.S. PILLAI BARODA I AM ENCLOSING HEREWITH THE PHOT OCOPY OF BANK STATEMENT WHICH IS NOW MARKED AS EXHIBIT .....D FRO M WHICH IT CAN BE VERIFIED THAT THE PAYMENT HAS BEEN MADE TO S.S. PIL LAI AND THIS IS NOT CASH WITHDRAWAL MADE BY THE APPELLANT. ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 32 HERE AGAIN THE APPELLANT MISLEADING YOUR HONOUR BY SAYING THAT HE HAS NOT MADE THE PAYMENT TO S.S. PILLAI AND THIS IS A W ITHDRAWAL IN CASH FROM BANK. 51. WE HAVE PURSUED THE MATERIAL ON RECORD. THE F OLLOWING FINDINGS OF THE LD. CIT(A) REMAIN UNCONTROVERTED BEFORE US AND THE SAME ARE HEREBY CONFIRMED: REGARDING ENTRY OF RS. 2,45,000/-, I AGREE WITH TH E SUBMISSION OF ASSESSEE THAT THIS ENTRY WAS WRONGLY ENTERED ON 02.03.2009 I N PLACE OF ACTUAL DATE OF 03.03.2009, HOWEVER, IT DID NOT MAKE ANY DIFFERENCE AS ASSESSEE HAD SUFFICIENT CASH BALANCE OF RS. 3,72,111/- ON 02.03. 2003 AND EVEN IF ENTRY OF RS. 2,45,000/- WAS CORRECTED THE CASH BALANCE DID N OT GO IN NEGATIVE. HOWEVER, THE ASSESSEE FAILED IN EXPLAIN THE ENTRIES OF RS. 1,71,000/-. THEREFORE, ADDITION OF RS. 1,71,000/- IS CONFIRMED. 52. IN LIGHT OF ABOVE, GROUND OF APPEAL NO. 7 IS DI SMISSED. THE APPEAL OF REVENUE IS PARTLY ALLOWED IN LIGHT OF ABOVE DIRECTIONS. ORDER PRONOUNCED IN THE OPEN COURT ON 18/09/2017. SD/- SD/- DQY HKKJR FOE FLAG ;KNO (KUL BHARAT) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER JAIPUR DATED:- 18/09/2017 *SANTOSH VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE RESPONDENT - THE ITO, WARD-2(1), KOTA. 2. IZR;FKHZ@ THE APPELLANT- SHRI BABU LAL SOMANI, PROP. M/S SOMANI & COMPANY AND SOMANI CARRIER, BUNDI ROAD, KOTA . 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDRVIHY@ THE CIT(A) ITA NO. 931/JP/13 ITO VS. SHRI BABU LAL SOMANI, KOTA. 33 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 931/JP/2013) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR.