Assistant Commissioner of Income-tax, V. Shree Om Rolling Mills Pvt. Ltd., Jalna

ITA 993/PUN/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7194 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-11-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 10-10-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 30-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 145

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE . , , BEFORE SHRI D.KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.993/PUN/2015 / ASSESSMENT YEAR : 2009-10 ACIT, JALNA CIRCLE, JALNA . /APPELLANT VS. SHREE OM ROLLING MILLS PVT. LTD., P.NO. D-51/2, ADDITIONAL MIDC, JALNA 431 203 PAN : AAACT6741J . / RESPONDENT / APPELLANT BY : SHRI AJAY MODI / RESPONDENT BY : SHRI J.P. BAIRAGRA / DATE OF HEARING : 10.10.2017 / DATE OF PRONOUNCEMENT: 10.11.2017 / ORDER PER D. KARUNAKARA RAO, AM : THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORD ER OF CIT(A)-I, AURANGABAD, DATED 29-04-2015 FOR THE A.Y. 2009-10 I N CONNECTION WITH THE PENALTY LEVIED BY THE AO U/S.271(1)(C) OF THE ACT V IDE ORDER DATED 14-03-2014. 2 REVENUE RAISED THE FOLLOWING GROUNDS : 1. ON THE FACTS & IN THE CIRCUMSTANCES OF THE CASE , THE LD.CIT(A), AURANGABAD HAS ERRED IN DELETING THE PENALTY OF RS. 56,08,774/- IMPOSED U/S.271(1)(C) OF THE ACT. 2. ON THE FACTS & IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A), AURANGABAD HAS ERRED IN NOT FOLLOWING HIS OWN ORDER S WHEREIN HE HAS CONFIRMED THE FACT OF SUPPRESSED PRODUCTION IN THE ORDER OF Q UANTUM APPEAL OF THE ASSESSEE FOR AY UNDER CONSIDERATION. 3. ON THE FACTS & IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A), AURANGABAD HAS ERRED IN NOT FOLLOWING HIS OWN ORDER S WHEREIN HE HAD ESTIMATED THE PROFIT @4% OF THE ESTIMATED SALE VALUE OF SUPPR ESSED PRODUCTION WHICH WAS NOTHING BUT CONCEALED INCOME. UNDER SUCH CIRCUMSTA NCES, HE SHOULD HAVE CONFIRMED THE PENALTY. ITA NO. 993/PUN/2015 SHREE OM ROLLING MILLS PVT. LTD., 2 4. ON THE FACTS & IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A), AURANGABAD SHOULD HAVE CONFIRMED THE PENALTY ATLEAS T TO THE EXTENT OF RS.76,48,922/-, THE INCOME OFFERED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS WHICH WAS NOTHING BUT CONCEALED INCOME. 5. ON THE FACTS & IN THE CIRCUMSTANCES OF THE CASE, THE ORDER OF THE LD.CIT(A), AURANGABAD BE QUASHED AND THAT THE ORDER OF THE AO BE RESTORED. 6. THE APPELLANT PRAYS LEAVE TO ADDUCE SUCH FURTHER EVIDENCE TO SUBSTANTIATE ITS CASE AS THE OCCASION MAY DEMAND. 3. BRIEFLY STATED RELEVANT FACTS OF THE CASE INCLUD E THAT ASSESSEE IS A COMPANY ENGAGED IN THE MANUFACTURING OF TMT BARS AND MS ROU ND BARS. ASSESSEE FILED THE RETURN OF INCOME ON 30-09-2009 DECLARING TOTAL INCO ME OF RS.2,28,22,000/-. CONSEQUENT TO ENQUIRY/INVESTIGATION CONDUCTED BY TH E DIRECTORATE GENERAL OF CENTRAL EXCISE INTELLIGENCE (DGCEI) ON THE ASSESSEE , IT IS FOUND THAT THE ASSESSEE IS ENGAGED IN REMOVAL OF THE GOODS CLANDESTINELY AN D OUTSIDE THE BOOKS. EVENTUALLY, THE ASSESSEE SUBMITTED A PETITION BEFOR E THE CENTRAL EXCISE AND CUSTOMS SETTLEMENT COMMISSION ADMITTING CLANDESTINE REMOVAL OF TMT BARS WORTH RS.20,37,49,961/- DURING THE PERIOD FROM 01-04-2008 TO 07-05-2008 (37 DAYS). ACCORDINGLY, THE SETTLEMENT COMMISSION PASSED THE O RDER DATED 23-11-2010 ACCEPTING THE APPLICATION OF THE ASSESSEE. BASED O N THE ORDER OF SETTLEMENT COMMISSION, THE ASSESSEE FILED A REVISED STATEMENT OF TOTAL INCOME ON 04-07-2011 DECLARING THE ADDITIONAL PROFIT OF RS.76 ,48,922/- RELATING TO THE UNACCOUNTED SALES LINKED TO THE SAID CLANDESTINELY REMOVED GOODS AND PAID THE TAX OF RS.31,14,110/-. THE REASONS FOR DECLARING T HE SAID ADDITIONAL PROFIT BEFORE THE AO IN TUNE WITH THE DISCLOSURE MADE BEFORE THE SETTLEMENT COMMISSION AND ARE PART OF THE RECORDS. HOWEVER, THERE IS NO EVID ENCE IN THE POSSESSION OF AO WHICH EVIDENCES THE SAID QUANTITY OF THE SAID CLAND ESTINELY REMOVED GOODS, CLANDESTINE SALES, EXTENT OF PROFITS EARNED ON SUCH SALES ETC. THESE DETAILS ARE OUTCOME OF ESTIMATIONS. REJECTING THE SAME AND INV OKING THE PROVISIONS OF SECTION 145(3) OF THE ACT, AO ALSO ANALYSED THE CON SUMPTION OF ELECTRICITY QUA THE ALLEGED UNACCOUNTED PRODUCTION AND FOUND CERTAIN DI SCREPANCIES. THUS, THE AO COMPLETED THE ASSESSMENT AND MADE ADDITION OF RS.11 ,61,01,030/-. IN THE ITA NO. 993/PUN/2015 SHREE OM ROLLING MILLS PVT. LTD., 3 PROCESS, THE AO REJECTED THE ASSESSEES ESTIMATED A DDITIONAL PROFIT OF RS.76,48,922/-. BEING AGGRIEVED, ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). THE CIT(A), VIDE ITS ORDER DATED 30-04-2012, RESTRICTED THE ADDITION ON SUPPRESSED PRODUCTION TO 4% WHICH WORKS OUT TO RS.1,73,51,470/ -. FURTHER, CIT(A) ALSO CONFIRMED THE OTHER ADDITION ON ACCOUNT OF WORKING CAPITAL AT RS.8,00,000/-. THE TOTAL ADDITION, THEREFORE, WORKS OUT TO RS.1,81,51, 470/-. THUS, THE CIT(A) GAVE RELIEF OF RS.9,79,49,560/- OUT OF ADDITION OF RS.11 ,61,01,030/-. 4. THE AO, VIDE HIS ORDER DATED 14-03-2014, LEVIED THE PENALTY OF RS.56,08,774/- U/S.271(1)(C) OF THE ACT ON RS.1,81, 51,470/-. CONTENTS OF PARA 10 OF PENALTY ORDER DATED 14-03-2014 BEING OPERATIONAL PARA IS REPRODUCED AS UNDER : 10. IN VIEW OF THE ABOVE DISCUSSION, IT I S ESTABLISHED THAT , THE ASSESSEE HAS CLANDESTINELY REMOVED M.S. BILLETS/INGOTS AND HAS E VADED EXCISE DUTY AND HAS NOT ACCOUNTED FOR THE SAID PURCHASES OF RAW MATERIAL AN D ALSO SALE OF M.S. BILLETS/INGOTS AS IS EVIDENT FROM THE INVESTIGATION AND ENQUIRIES MADE BY DIRECTOR GENERAL OF CENTRAL EXCISE INTELLIGENCE (DGCEI). FUR THER , THE ASSESSEE HAS ALSO ADMITTED THE SAID CLANDESTINE REMOVAL OF GOODS IN T HE STATEMENT RECORDED I N INVESTIGATION BY DGCEI AND ALSO BEFORE THE SETTLEME NT COMMISSION OF CUSTOMS AND EXCISE DEPARTMENT. THE ASSESSEE HAS PAID THE EX CISE DUTY AND THE SETTLEMENT COMMISSION HAS LEVIED TOKEN PENALTY IN RESPECT OF T HE SAID CLANDESTINE SALE OUT OF THE BOOKS . IN ADDITION TO THIS THE SUPPRESSED PRODUCTION IN AS SESSEE'S CASE IS ALSO ESTABLISHED AND ALSO CORRECTLY REJECTED THE BOOKS O F ACCOUNT BY APPLICATION OF PROVISIONS OF SECTION 145 OF THE INCOME-TAX ACT,196 1. IN VIEW OF THIS POSITION, THE MODUS OPERANDI OF THE ASSESSEE'S UNACCOUNTED PRODUC TION HAS NOT ONLY BEEN PROVED BY THE INCOME-TAX DEPARTMENT BUT ALSO OTHER DEPARTMENTS LIKE EXCISE AND DGCEI. THEREFORE, I AM SATISFIED THAT, THE ASSESSEE CONCEALED THE PARTICULARS OF INCOME TO THE EXTENT OF RS. 1,81,51,470/ - ON ACCOUNT OF SUPPRESSED PROFIT UNDISCLOSED TURNOVER OUT OF THE BOOKS OF ACCOUNTS A ND COMMITTED A DEFAULT UNDER SECTION 271(L)(C) OF THE INCOME-TAX ACT,L961. ACCOR DINGLY, I LEVY A MINIMUM PENALTY OF RS.56 , 08 , 774/ - BEING 100 % OF TAX SOUGHT TO BE EVADED (RUPEES FIFT Y SIX LAKHS EIGHT THOUSAND SEVEN HUNDRED AND SEVENTY FOUR ONLY) UNDER SECTION 271 (L)(C) OF THE INCOME-TAX ACT,1961. 5. AGGRIEVED WITH THE SAID PENALTY ORDER OF THE AO, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). ASSESSEE SUBMITTED THAT THE AOS ESTIMATED UNRECORDED PRODUCTION OF RS.15,845.815 METRIC TONNES OF BARS, APPLYING THE FORMULA OF USE OF 178 UNITS OF ELECTRICITY PER METRIC TONNE, IS MEREL Y AN ESTIMATION AND AN ARBITRARY ONE. ASSESSEE ALSO DEMONSTRATED THE RESTRICTION OF ADDITION TO RS.1,81,51,470/-, I.E. 4% OF THE SALES OF RS.43.38 CRORES, AGAINST OR IGINAL ADDITION OF RS.11,61,01,030/-. THE PENALTY ON THE SAME WORKS O UT TO RS.56,08,774/-. ITA NO. 993/PUN/2015 SHREE OM ROLLING MILLS PVT. LTD., 4 EVENTUALLY, THE CIT(A) DELETED THE PENALTY OF RS.56 ,08,774/- GIVING THE REASONS IN PARA 6.3 TO 6.6 OF THE ORDER OF THE CIT(A). WHILE THE DEBATABILITY CONSTITUTES ONE REASON, THE ESTIMATION IS THE OTHER ONE FOR THE DEL ETION OF THE PENALTY. THUS, THE PENALTY RELATABLE TO THE ENTIRE ADDITION OF RS.1,81 ,51,470/- WHICH ALSO INCLUDES THE ADMITTED COMPONENT OF RS.76,48,922/- STANDS DELETED . THEREFORE, THE REVENUE IS IN APPEAL AGAINST THE ORDER OF THE CIT(A). REVENUE DESIRES THAT THE PENALTY SHOULD BE CONFIRMED ATLEAST TO THE EXTENT OF INCOME OF RS.76,48,922/- THE ADMITTED INCOME IN THE SAID REVISED COMPUTATION OF INCOME. 6. DURING THE PENALTY PROCEEDINGS BEFORE THE INCOME -TAX AUTHORITIES, ASSESSEE MADE WRITTEN SUBMISSIONS AND PRAYED FOR DELETION OF THE ENTIRE PENALTY AS THE ADDITIONS WERE EVENTUALLY MADE ON THE BASIS OF ESTI MATIONS. ASSESSEE SUBMITTED THAT THE ADDITION IS A DEBATABLE ONE IN NATURE AND THERE IS A PIGMENT OF ESTIMATIONS IN APPLYING 4% TO THE SAID CLANDESTINEL Y REMOVED GOODS. THIS APPLY TO BOTH ELECTRICITY CONSUMPTION BASED ESTIMATION AS WELL AS THE DGCEI BASED ESTIMATIONS. AS PER THE DISCUSSION GIVEN IN PARA 6 .6 THE CIT(A) DELETED THE ENTIRE PENALTY OF RS.56,08,774/-. BEFORE THE TRIBUNAL : 7. THE REVENUE FILED THE PRESENT APPEAL AGAINST THE SAID ORDER OF CIT(A) IN DELETING THE PENALTY OF RS.56,08,774/- LEVIED U/S.2 71(1)(C) OF THE ACT. SHRI AJAY MODI, LD. DR FOR THE REVENUE SUBMITTED T HAT THE CIT(A) HAS ERRED IN PRESUMING THAT THE ENTIRE PENALTY OF RS.56,08,77 4/- IS RELATABLE TO THE ESTIMATED ADDITION OF RS.1,81,51,470/-. ACCORDING TO THE LD. DR, THE CIT(A) IGNORED THE FACT THAT THE INCOME TO THE EXTENT OF RS.76,48,922/-, WH ICH WAS SUO MOTO OFFERED BY THE ASSESSEE, CONSTITUTES THE CONCEALED INCOME. IT IS RELATABLE TO THE SAID CLANDESTINELY REMOVED GOODS PRODUCED AND SOLD AT TH E BACK OF THE DEPARTMENTS AND THEREFORE, THIS PORTION OF INCOME DOES NOT CONS TITUTE ESTIMATED PROFITS. ITA NO. 993/PUN/2015 SHREE OM ROLLING MILLS PVT. LTD., 5 THEREFORE, AS PER LD. DR, THE CIT(A) UNFAIRLY CARRI ED AWAY BY THE FIGURE OF RS.1,81,51,470/-, I.E. 4% OF THE SUPPRESSED SALES. IT IS THE PRAYER OF THE LD. DR THAT THE PENALTY RELATABLE TO THE INCOME OF RS.76,4 8,922/- OFFERED BY THE ASSESSEE IN THE REVISED COMPUTATION OF INCOME SHOULD BE CONF IRMED. HOWEVER, LD. DR FAIRLY MENTIONED THAT THE FLAT RATE OF 4% IS APPLIED WHILE ESTIMATING THE SAID INCOME OF RS.76,48,922/-. 8. PER CONTRA, REFERRING TO SAID INCOME OF RS.76,48 ,922/- IN PARTICULAR, SHRI J.P. BAIRAGRA, LD. AR FOR THE ASSESSEE SUBMITTED THAT TH E SAID AMOUNT OF RS.76,48,922/- IS ARRIVED AT BY THE ASSESSEE ALSO B Y WAY OF ESTIMATION APPLYING THE FLAT RATE OF 4% OF THE GOODS CLANDESTINELY REMO VED BY THE ASSESSEE. THE SAID ESTIMATIONS WERE ACCEPTED BY THE AO/CIT(A)/ITSC AN D IN SUCH CASE, THE SAID INCOME ALSO CONSTITUTES THE ESTIMATED PROFITS OF TH E ASSESSEE RELATABLE TO THE CLANDESTINELY REMOVED GOODS. ACCORDINGLY, THE RELA TABLE PENALTY ON THE SAID INCOME OF RS.76,48,922/- ALSO SHOULD BE DELETED AS DONE BY THE CIT(A). LD. AR FOR THE ASSESSEE ALSO SUBMITTED THAT THE DEPARTMENT DOES NOT HAVE ANY INCRIMINATING MATERIAL AGAINST THE ASSESSEE TO SHOW THAT THE SAID INCOME OF RS.76,48,922/- IS NOT THE ESTIMATION BASED INCOME. LD. AR FOR THE ASSESSEE FILED WRITTEN SUBMISSIONS IN SUPPORT OF HIS ARGUMENTS. W E PROCEED TO EXTRACT THE SUBMISSIONS MADE BY THE LD. AR FOR THE ASSESSEE AND THE SAME READS AS UNDER: 17. THE APPELLANT FILED AN APPEAL BEFORE CIT(A) AG AINST THE PENALTY ORDER. LD CIT(A) PASSED ORDER DATED 29.4.2015 WHEREIN HE DELE TED THE PENALTY LEVIED BY THE AO U/S 271(I)(C) OF THE ACT. THE DECISION OF LD CIT (A) IS GIVEN AT PARA NO 6 TO 6.6, PAGE 11 TO 15 OF THE CIT(A) ORDER. 18. LD CIT(A) HAS DELETED THE PENALTY BY HOLDING AS FOLLOWS: (A) LD CIT(A) RELIED ON THE DECISION OF THE HON CE& S TAX APPELLATE TRIBUNAL IN THE CASE OF SRJ PEETY STEELS PVT LTD & ORS AND HELD THAT THE ESTIMATION OF ELECTRICITY UNITS ON THE BASIS OF CONSUMPTION OF EL ECTRICITY UNITS IS NOT FOUND TO BE JUSTIFIED. (PARA 6.2 TO 6.3) (B) HE FURTHER HELD THAT THE ISSUE OF ESTIMATION OF PRODUCTION ON THE BASIS OF CONSUMPTION OF ELECTRICITY UNITS IS DEBATABLE AND T WO VIEWS ARE POSSIBLE. FURTHER IT IS A SETTLED LAW THAT IN CASES WHERE ADDITION IS BA SED ON THE ISSUES WHICH ARE DEBATABLE AND WHERE TWO VIEWS ARE POSSIBLE, PENALTY U/S 271(1)(C) IS NOT LEVIABLE (PARA 6.3) ITA NO. 993/PUN/2015 SHREE OM ROLLING MILLS PVT. LTD., 6 (C) IN PARA 6.4 HE FURTHER HELD THAT IN THIS CASE T HE ADDITIONS CONFIRMED ARE BASED ON ESTIMATION AND THAT NO PENALTY IS ATTRACTE D WHERE ADDITION IS MADE ON ESTIMATE BASIS. 19. WE FURTHER SUBMIT THAT IN THIS CASE BEFORE THE NOTICE OF HEARING U/S.142(1) DATED 10.8.2011 WAS ISSUED THE APPELLANT HAD VOLUNT ARILY FILED REVISED COMPUTATION OF INCOME TOGETHER WITH LETTER DATED 4. 7.2011 DISCLOSING ADDITIONAL INCOME OF RS.76,48,922 AND PAID THE TAXES DUE AND A LSO ENCLOSED COPY OF CHALLAN WHICH IS AT PAGE NO 75 TO 77 OF THE PAPERBOOK. 20. SINCE THE SETTLEMENT COMMISSION OF EXCISE DEPAR TMENT HAS PASSED THE ORDER ON 23.11.2010 ACCEPTING THE CLANDESTINE REMOV AL OF THE GOODS WHICH TOOK PLACE AFTER THE FILING OF RETURN ON 30.9.2009 AND T HE ASSESSEE HAS ON ITS OWN FILED THE REVISED COMPUTATION OF INCOME ON 4.7.2011 , NO PENALTY CAN BE LEVIED IN THIS CASE. WE RELY ON THE DECISION OF SU PREME COURT IN THE CASE OF CIT VS. SURESH CHANDRA MITTAL WHICH IS REPORTED AT 251 ITR 9. COPY OF ORDER IS ENCLOSED ALONGWITH COPY OF ORDER OF MADHYA PRADESH HIGH COURT IN THIS CASE REPORTED IN 241 ITR 124. 9. FURTHER, FOR DELETING THE PENALTY, THE LD. AR FO R THE ASSESSEE RELIED ON VARIOUS JUDICIAL PRONOUNCEMENTS VIZ., (1) RAJAN H. SHINDE VS. DCIT 103 ITD 360 (PUNE) (TM), (2) HARIGOPAL SINGH VS. CIT 258 ITR 85 (PUNJ. & HAR), (3) CIT VS. KRISHI TYRE RETREADING & RUBBER INDUSTRIES 360 ITR 580 (RAJASTHAN) AND (4) CIT VS. MODI INDUSTRIAL CORPORATION 195 TAXMAN 68 10. RELYING ON THE HONBLE SUPREME COURT JUDGMENT I N THE CASE OF CIT VS. SURESH CHANDRA MITTAL 251 ITR 9 (SC), LD. AR FOR TH E ASSESSEE SUBMITTED THAT THE PENALTY SHOULD BE CANCELLED WHEN THE DEPARTMENT FAI LED TO DISCHARGE ITS BURDEN PROVING THE CONCEALMENT AND WHEN THE DEPARTMENT MER ELY RESTED ITS CONCLUSION ON THE ASSESSEES ACT OF VOLUNTARY SURRENDER MADE IN GOOD FAITH. HE ALSO RELIED ON THE THIRD MEMBER DECISION OF THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF RAJAN H. SHINDE VS. DCIT WHICH IS RELEVANT FOR THE PROPOS ITION THAT THE PENALTY U/S.271(1)(C) OF THE ACT NEED TO BE DELETED IN RESP ECT OF THE GP ADDITION MADE ON ESTIMATION BASIS. 11. WE HEARD BOTH THE PARTIES AND PERUSED THE ORDER S OF THE REVENUE AS WELL AS THE WRITTEN SUBMISSIONS OF THE ASSESSEE. THE DE LETION OF PENALTY U/S.271(1)(C) OF THE ACT IN RESPECT OF THE ESTIMATED ADDITIONS IS A DECIDED ISSUE. THERE ARE ITA NO. 993/PUN/2015 SHREE OM ROLLING MILLS PVT. LTD., 7 MANY JUDGMENTS TO SUPPORT THE SAME. THEREFORE, IN PRINCIPLE, WE CONFIRM THE ORDER OF THE CIT(A) AND DELETE THE PENALTY RELATABL E TO THE ESTIMATED ADDITION. 12. HOWEVER, WITH REGARD TO THE PENALTY LEVIED RELA TING TO THE ADDITION OF RS.76,48,922/- IS CONCERNED, WE FIND, THE REVENUE R AISED GROUND NO.4 OF ITS APPEAL. IN THE SAID GROUND NO.4, THE REVENUE OPINE S THAT PENALTY ON THE INCOME RELATABLE TO THE CLANDESTINE SALE OF UNRECORDED PRO DUCTION NEEDS TO BE CONFIRMED, EVEN IF THE RELATED PROFITS OF RS.76,48,922/- IS ES TIMATED APPLYING THE FLAT RATE OF 4%. LD. AR FOR THE ASSESSEE ARGUED THAT THE SAID IN COME IS ARRIVED AT BY THE ASSESSEE AGAIN BASED ON THE ESTIMATION ON THE ESTIM ATED SALE OF THE GOODS CLANDESTINELY REMOVED BY THE ASSESSEE. THE UNRECOR DED PRODUCTION WAS ALSO THE PRODUCT OF ESTIMATION BY THE DGCEI AND EVENTUALLY T HE SAME WAS ACCEPTED BY THE SETTLEMENT COMMISSION. ABSENCE OF ANY INCRIMINATING MATERIAL IN SUPPORT OF THE SAID CLANDESTINELY REMOVED GOODS, ITS QUANTITY AND ALSO EARNING OF PRECISE AMOUNT OF INCOME OF THE SAID GOODS, AUTHORITIES RESORTED T O ESTIMATIONS. REVENUE IS NOT PRIVY TO THE RELEVANT FACTS (1) PRECISE QUANTITY OF SUCH RECORDED SALES AND (2) PRECISE INCOME OUT OF THE SALE OF SUCH GOODS AND TH EY MERELY RELIED ON THE FIGURES GIVEN BY THE ASSESSEE. THE QUANTITY OF UNACCOUNTED PRODUCTION IS ESTIMATED BY THE EXCISE DEPARTMENT AND THE TAXABLE INCOME IS EST IMATED FOR THE INCOME-TAX DEPARTMENT BY THE ASSESSEE APPLYING THE FLAT RATE OF 4%. DESPITE THE ABSENCE OF ANY DISCUSSION IN THE ORDER OF THE CIT(A) ON THIS P ART OF THE ISSUE OF ARGUMENT, SPECIALLY, THE CIT(A) GRANTED RELIEF PRESUMING THAT THIS SEGMENT OF INCOME IS ALSO ARRIVED AT BY THE ESTIMATION. IN OUR VIEW, THE SAI D PRESUMPTION IS FAIR AND REASONABLE. IN ANY CASE, NOTHING IS BROUGHT TO OUR NOTICE BY THE LD. DR TO DEMONSTRATE THE ESTIMATIONS ARE NOT INVOLVED BOTH I N ARRIVING AT THE FIGURE OF UNRECORDED SALES AND THE TAXABLE INCOME. FOR OUR M IND, IT APPEARS THAT THE INCOME OF RS.76,48,922/- IS ALSO THE PRODUCT OF EST IMATION AND THE SAME IS ACCEPTED BY THE AO/CIT(A)/ITSC. THEREFORE, IT CONS TITUTES A REASONABLE PRESUMPTION BY THE CIT(A). THEREFORE, THE ORDER OF CIT(A) IS FAIR AND REASONABLE ITA NO. 993/PUN/2015 SHREE OM ROLLING MILLS PVT. LTD., 8 FOR THE SAID REASONS TOO. ACCORDINGLY, THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 13. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 10 TH DAY OF NOVEMBER, 2017. SD/- SD/- (VIKAS AWASTHY) (D. KARUNAKARA RAO) /JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE; DATED : 10 TH NOVEMBER, 2017. / COPY OF THE ORDER FORWARDED TO : BY ORDER // TRUE COPY // //TRUE COPY// SENIOR PRIVATE SECRETARY , / ITAT, PUNE THE APPELLANT THE RESPONDENT THE CIT(A) - 1, AURANGABAD CIT - 1, AURANGABAD , , B BENCH PUNE; / GUARD FILE.