Income Tax Appellate Tribunal - Jodhpur
Ashok Kumar Agarwal vs Income Tax Officer on 29 June, 2004
Equivalent citations: (2005)98TTJ(JODH)663
ORDER
Hari Om Maratha, J.M.
1. This appeal has been filed by the assessee against the order of learned CIT(A), dt. 24th June, 1998, which pertains to asst. yr. 1995-96.
2. At the time of hearing, Shri U.C. Jain was present on behalf of the assessee, and Shri O.P. Choudhary was present on behalf of the Department.
3. The facts in brief are that a survey was conducted on 10th Oct., 1995, in the case of this assessee. Certain papers were found which pertain to asst. yr. 1996-97 and not to the assessment year under consideration. The AO rejected the books of account for the year under consideration on the basis of papers found during the course of survey. The Department has also not established or proved that these papers were not entered into the regular books of account. The learned CIT(A) rejected the books by stating that the sales and purchases were not fully vouched and stock registers were not maintained. The case of the assessee is that sales and purchases were fully vouched. The papers relating to sales and purchases, according to the learned Authorised Representative, are still in the possession of the Department. The AO applied the gross profit rate of 22 per cent on the declared sales. But, the case of the assessee is that there is no comparable case to justify the GP rate of 22 per cent on gross sales. The learned CIT(A) confirmed this addition.
4. We have heard the learned rival Representatives and have perused the evidence on record.
5. After hearing the learned arguments, we are convinced that the additions made by AO and sustained by learned CIT(A) cannot be allowed to be continued because even after applying the provisions of Section 145 of the Act, the additions are not necessary to be made. If the Department wants to make additions, it should be based on certain reasonable reasons, namely, either comparing the assessee's case with his own past history or with other comparable cases. In our opinion, the ITO has not done this exercise. So, the AO has to accept the books of account. The AO has not even given or pointed out any specific defects in the books of account of the assessee. Consequently, we allow this ground of appeal raised by the assessee.
6. The other grounds of appeal raised by the assessee are not pressed. So, these are dismissed as not pressed.
7. In the result, the appeal of the assessee is partly allowed.