Income Tax Appellate Tribunal - Agra
A.K.Shivhare &Co,, Gwalior vs Department Of Income Tax on 21 May, 2012
IN THE INCOME TAX APPELLATE TRIBUNAL
AGRA BENCH, AGRA
BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND
SHRI A.L. GEHLOT, ACCOUNTANT MEMBER
ITA Nos.270 & 415/Agr/2009
Assessment Years : 2005-06 & 2006-07
Addl. Commissioner of Income Tax, vs. M/s. A.K. Shivhare & Company,
Range-3, Gwalior. Hat Road, Guna.
(PAN: AALFA 1266 H).
(Appellant) (Respondent)
Appellant by : Shri Waseem Arshad, Sr. D.R.
Respondent by : Shri R.C. Tomar, I.T.P.
Date of Hearing : 21.05.2012
Date of Pronouncement of order : 08.06.2012
ORDER
PER A.L. GEHLOT, ACCOUNTANT MEMBER:
These are two appeals filed by the Revenue against two different orders dated 20.02.2009 & 29.06.2009 passed by the ld. CIT(A), Gwalior for the Assessment Years 2005-06 & 2006-07 respectively.
ITA No.270/Agr/2009 for A.Y. 2005-06 by the REvenue
2. In this appeal, the Revenue has raised the following grounds :- 2 ITA Nos.270 & 415/Agr/2009
A.Ys. 2005-06 & 2006-07 .
"(i) On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs.17,74,861/- being the amount of work done by the assessee before 31.03.2005 as per measurement done by G.M., M.P.R.R.D.A. Raisen and which was not reflected in its contract receipts by the assessee.
(ii) On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs.6,11,586/- on account of suppressed closing stock because this amount is shown in the balance sheet but is not shown in the trading account.
(iii) On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the disallowance of Rs.20,000/- being provision for legal and consultancy charges debited to Profit & Loss account, although no explanation for its admissibility was submitted by the assessee.
(iv) On the facts and circumstances of the case, the Ld. CIT(A) has erred in holding that the additions as mentioned in ground No.1, 2 &
3 above are covered in the surrender of Rs.5 lacs made by the assessee during the course of assessment proceedings whereas the said surrender by the assessee was specifically to cover up the possible leakage of income due to missing bills and vouchers as mentioned by the assessee in its letter dated 28.12.2007 as well as per order sheet entry dated 28.12.2007.
(v) The appellant craves leave to add/alter the grounds of appeal."
3. The first ground of appeal pertains to addition of Rs.17,74,861/-.
4. The brief facts of this ground are that the assessee is a contractor doing work for different Departments. During the assessment proceedings, the Assessing Officer found that the assessee did not produce complete vouchers and supporting bills. On confrontation of deficiency, the assessee vide letter dated 28.12.2007 3 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
surrendered an income of Rs.5,00,000/- in addition to income declared in the original return to cover up the possible leakage due to missing of bills and vouchers. During the assessment proceedings, information was received from G.M., M.P.R.R.D.A., Raisen who has informed that Rs.13,07,622/- and Rs.4,67,239/- was payable to the assessee s on 31.03.2005. The Assessing Officer asked explanation from the assessee. The assessee submitted that this amount was work in progress of sub-contactors. The A.O. noted that the assessee failed to furnish supporting evidence. In the light of the fact, the Assessing Officer made addition of Rs.17,74,861/-.
5. Before the CIT(A) the assessee submitted that the assessee neither completed the work of G.M., M.P.R.R.D.A. nor had raised any bill nor any such amount has either been received or shown as reasonable in the accounts of the assessee's firm, nor any such amount has been remitted after making TDS to the assessee by the G.M., M.P.R.R.D.A. It was submitted that the amount pertained to next accounting year and the same is found credited in the next year and the assessee offered the same in the next year after accounting for it in the receipt account. It is also submission of the assessee that the amount has been determined as payable and if so why the same was not subjected to TDS because whatever the amount has been determined as payable on final submission of bills are subjected 4 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
to TDS and once the TDS has been made in the A.Y. 2006-07 and so also the amount has been paid and credited in assessee's account in Assessment Year 2006- 07 the same cannot be brought to tax in Assessment Year 2005-06. It is also submission of the assessee that the A.O. has utilized information direictlaya collected from the office of M.P.R.R.D.A. without providing details to the assessee. The CIT(A) deleted the addition accepting the assessee's contention. The CIT(A) also held that since the Assessing Officer has accepted the surrender of Rs.5,00,000/-, therefore, there is no need to make supporting addition of Rs.17,74,861/-. The CIT(A) accordingly deleted the addition.
6. We have heard the ld. Representatives of the parties and records perused. Before us, the ld. Authorised Representative submitted that there is no difference in total contract receipts from G.M., M.P.R.R.D.A. which is Rs.24,36,247/-. However, the ld. Authorised Representative with reference to the letter dated 06.12.2007 of M.P.R.R.D.A submitted that the difference was not on account of contract receipt but the amount was payable as the awarder has deducted some amount from G.M., M.P.R.R.D.A contract receipt on account of Excise Duty for 25%, E.W. for other reasons for non-employment of technical staff etc. It is relevant to reproduce the explanation filed by the Ld. Authorised Representative before us which reads as under :-
5 ITA Nos.270 & 415/Agr/2009
A.Ys. 2005-06 & 2006-07 .
"As per copy of letter dated 6.1.207 (para 5) of the aforesaid letter the amount payable as on 31.03.2005 has been informed by MPRRDA, Raisen as under :
As per agreement No.40/PM/GSY/04
Dt. 10.03.2004 1307622.00
41/PM/GYS/04 dt. 10.03.2004 467239.00
The A.O. has treated this amount as unaccounted for contract receipts.
Whereas these are the deductions made by the contractee out of gross contract receipts for various reasons such as E.D. for 25% E.W., E.W. for other reasons for non employment of technical staff etc. as per details given on page 6 & 7 and is clear from the following.
Regarding Rs.1307622/- (40/PMGSY/04) dt. 10.03.2004 As per page 6 the total of deposit on account of deduction out of gross contract receipts under various heads as shown at Col. 17 Rs.1437622.00 For arriving at the figure of Rs.1307622/- the department has subtracted the following figures -
- E.D. for royalty (Co. 15) Rs.50000.00
- E.D. for other reasons (Col.14) Rs.50000.00
- For Non-employment of tech. staff. (Col.12) Rs.2500000
- For Test report (Col.11) Rs.5000 Rs.130000.00
Rs.1307622.00
Thus the amount payable to the contractor as on 31.03.2005 as informed by the contractee is residue amount on account of deductions made from the gross contract receipt. Thus the A.O. has erred in presuming that these are unaccounted for contract receipts where as the gross contract receipts which include Rs.1307622/- had already been accounted for in the gross contract receipts as per details explained above.
Regarding Rs.467239/- as per agreement No.41/PMGSY/04) dt. 10.03.2004 Similar is the position in respect of aforesaid agreement. As per page 7 the total of deposit on account of deductions out of Gross Contract receipts under various heads as shown at Col. 16 Rs.606020.00 For arriving at the figure of Rs.1307622/- the department has subtracted the following figures -
- E.D. for Time Extension (Col.11) Rs.118781.00
- Deduction for Tech. Staff Rs.20000.00 Rs.138781.00 Rs.467239.00 6 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
Thus the figure of Rs.467239/- stated to be payable as on 31.0.2005 does not represent the unaccounted for contract receipts. In fact this figure represent the deduction made by the department under various heads out of gross contract receipts as explained above and are subject to return. The A.O. has not disputed that there is any difference on account of accounting for the gross contract receipts derived by the assessee as per letter issued by MP PRDA and are duly matched with the payments made and accounted for in the books of assessee as per details given on page 4, 5, 6 & 7."
7. At the same time, it is also relevant to reproduce the relevant abstract of the submission of the assessee before the CIT(A) from page 6 of CIT(A) which reads as under :-
"The A.O. has added this amount on the ground that the sum was stated to be payable by the aforesaid authority to the assessee as on 31.03.2005. The fact is that the assessee has neither completed the work of the aforesaid sum for GM, MPRRDA nor had he raised any bill for the same, nor any such amount has either being received or shown as receivable in the accounts of the assessee's firm, nor any such amount has been remitted after making TDS to the appellant by the said GM, MPRRDA. In fact, it relates to next accounting year and the same is found credited in next year and the appellant has also offered the same in the next year after accounting for it in the receipts. Therefore the addition made by the A.O. being without basis is incorrect. It may be submitted that the amount included by the AO in asstt. Year 05-06 on the basis of information received from the GM MPRRDA does not mention any details as to how this amount has been worked out and the amount if any was really determined payable and if so why the same was not subjected to TDS because whatever, the amount has been determined as payable on final submission of bill are subjected to TDS and once the TDS has been made in the Asstt. Year 2006-07 and so also the amount has been paid and credited in assessee's account in the said asstt. Year 06-07 the same cannot be brought to tax in Asstt. Year 05-06. Therefore, the assessee had rightly included the afore said payment in the contract receipts of the assessment year 06-07 on the basis of TDS certificate issued by the department MPRRDA, RAISEN in a.y. 06-07. In these circumstances to tax the same will be taxed again in asstt. year 05-06 will be gross injustice and against the method of accounting regularly followed by 7 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
the assessee and accepted by department mere on the basis of information without appreciation of correct facts of the case as aforesaid. The AO had not considered the fact that the amount has been subjected to TDS in asst. year 06-07 and can only be rightly included in the contract receipts of the assessee in asstt. year 06-07 and not in a.y. 05-06 on the basis of TS certificate issued by the department for astt. Year 06-07. In the subsequent asstt. Year 06-07 the aforesaid contract receipts shown by the appellant had been accepted by the department as being taxable on the basis of TDS certificate issued by the department and the AO's action in bringing to tax in asstt. year 05-06 is illegal, against the facts of the case, against the accountancy principle and method of accounting regularly followed by the assessee and may kindly be directed to be deleted. The A.O. has utilized information directly collected from the office of MPRRDA Raisen for making addition of Rs.17,74,861/- being amount received from them by the appellant. The appellant has not raised any bill nor any payment has been made, therefore it is not understand how can the Deptt. Given such a certificate. The Learned A.O. has also not given any copies of information utilized against the assessee which is not justified,"
8. On reading of explanation before the CIT(A) and before us these are contrary submissions of the assessee. Whatever submissions by the Ld. Authorised Representative at this stage the facts cannot be verified. If the issue is to be seen from the point of accounting principle, the explanation of the assessee is very simple and fortified by the books of accounts. If this amount has been received in subsequent year and has been offered for tax this submission can be explained very well by furnishing the relevant abstract of books of accounts of contract receipts in the year under consideration and for the subsequent year. The assessee instead of furnishing such reasonable documents, tried to further explain which is just 8 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
contrary to the earlier explanation that the amount was payable on account of E.D. royalty and others etc. It is also relevant to state that this explanation furnished before us is also not supported by the relevant abstract of books of account which is very well in the possession of the assessee and the burden is on the assessee to furnish such information and details of documents to ascertain the correct fact. The law of mandate provides that a person possessing the relevant material and not furnishing before the Court, an adverse inference can be taken as held by Hon'ble High Court of Madras in the case of CIT vs. Krishna Veni Ammal, 158 ITR 826 (Mad). In the said case, there were crossed cheques but the same were not produced. The Court held as under :-
"Held, (1) that, in the instant case, the Tribunal acted on the sole interested statement of the assessee and even though crossed cheques were available, they were not produced and, hence the Tribunal's conclusion was not correct.
(2) that taking into consideration the difference in peak credit transactions between the assessment years 1956-57 and 1957-58 (under reference), a sum of Rs.16,000 was the income earned by the assessee from other sources. The assessee was not entitled to claim deduction of interest said to have been paid on the hundi loans."
9. In the light of the above discussion, we find that the CIT(A) has wrongly deleted the addition simply relying on assessee's submissions without verifying the relevant facts. The assessee furnished contradictory submissions before us and 9 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
before the CIT(A). The assessee failed to furnish correct facts/information. Thus, an adverse view is taken and in the light of the facts, the order of CIT(A) is set aside and order of the A.O. is restored on the issue. The set off allowed by the CIT(A) against surrender of Rs.5,00,000/- is not correct as this addition of Rs.17,74,861/- was independent addition. The surrender of Rs.5,00,000/- was for deficiencies in vouchers etc. Therefore, the CIT(A) is not correct in allowing set off against this addition of Rs.17,74,861/-. The order of CIT(A) on the issue is also revered. The set off claim of the issue is rejected.
10. The brief facts of the second ground are that during the assessment proceedings, the A.O. noticed the assessee has shown closing stock of Rs.6,11,586/- in the balance sheet but the said amount was not shown in the trading account. The assessee submitted that he followed the accounting system wherein the stock of purchase were reduced in respective purchase account of the closing stock has been shown in the balance sheet The Assessing Officer was not satisfied with the explanation of the assessee. Therefore, he made addition of Rs.6,11,586/-. Before the CIT(A) submission of the assessee noted from the order of CIT(A) at page 7 is as under :-
"The item wise detail of closing stock is given as under :-
S.No. Particulars Amount
1. Repair and Maint. 120000.00
10 ITA Nos.270 & 415/Agr/2009
A.Ys. 2005-06 & 2006-07
.
2. Parts Tyre Tube 39750.00
3. Bitumen 239796.00
4. Diesel 200990.00
5. Material 11050.00
---------------
Total 611586.00
We are submitting herewith copies of accounts of the above expenses as required. Further, we are producing herewith cash book, ledger, bills & vouchers for your kind perusal. From the above, it is evident that the assessee has properly recorded details of closing stock."
11. We find substance in assessee's submission that the assessee has followed a system of accounting in respect of purchases to take net amount of repair & maintenance, part tyre tube, bitumen, diesel and material expenses. This fact is verifiable from the copies of the ledger account of financial statement furnished by the assessee and available in the Paper Book. When purchases expenses have been debited to Profit & Loss account by net amount, naturally the stock in hand in this account remains in the respective individual account which can be said to be individual trading account. The corresponding effect of the accounting entries are shown by the assessee in the Balance Sheet. The Assessing Officer did not appreciate the fact. We, therefore, find that this addition is not warranted. Therefore, the same is deleted on the reasons discussed above and not for the reasons given by the CIT(A) for deleting this addition that the assessee has sundered Rs.5,00,000/- which covers this addition also and addition of 11 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
Rs.6,11,586/- on account of closing stock is not warranted. Therefore, we do not find substance in this ground of appeal of the Revenue and the same is, therefore, dismissed.
12. The third ground is in respect of deletion of addition of Rs.20,000/- on account of provision for legal and consultancy charges. The A.O. disallowed the said amount as the assessee failed to furnish any expense regarding the provision for legal and consultancy charges. The CIT(A) deleted this addition on the ground that the assessee has surrendered Rs.5,00,000/-.
13. After hearing the ld. Representatives of the parties, we do not find any infirmity in the order of CIT(A) as the assessee has surrendered Rs.5,00,000/- on account of non-producing the relevant bills and vouchers. This Rs.20,000/- consultancy includes in that deficiency. Therefore, the separate addition is not warranted. The CIT(A) has rightly deleted the addition.
14. Ground no.4 is in in connection with ground nos.1 to 3 requires no separate finding. Thus, appeal of the Revenue is partly allowed. 12 ITA Nos.270 & 415/Agr/2009
A.Ys. 2005-06 & 2006-07 .
ITA No.415/Agr/2009 for A.Y. 2006-07 by the Revenue
15. Ground nos.1, 2, 3 & 4 are in respect of following additions made on account of bogus liabilities:-
1) Rs.39,08,700/- on account of wages.
2) Rs.22,57,700/- on account of gitty
3) Rs.12.22.500/- on account of goods
4) Rs.18,74,711/- on account of material expense.
16. During the assessment proceedings the A.O. noticed that the assessee has shown credit balance in labour account Rs.40,81,200/- pertaining to 3 months January, February & March. The A.O. further noticed that out of the outstanding balance of Rs.40,81,200, the assessee has paid Rs.1,00,500/- in the next F.Y. 2006- 07 for the period 01.04.2006 to 31.03.2007. The assessee has failed to furnish necessary confirmation in respect of balance liability of Rs.39,08,700/- . Similar facts were found in respect of other outstanding liabilities. The A.O. noted that the assessee has failed to file confirmatory letters regarding these outstanding liabilities. On examination, the A.O. found that the assessee has failed to prove the capacity of these parties for having such huge outstanding balances. The A.O. has also examined the issue from the allowability of the expenses and noted that separate addition on account of disallowance of expenses are being not made as the addition has been made on account of bogus liability to avoid double addition. 13 ITA Nos.270 & 415/Agr/2009
A.Ys. 2005-06 & 2006-07 .
17. The CIT(A) deleted the said addition as under :- (CIT(A) page 7) "Reliance has been placed on case of CIT vs. Pancham Das Jain 205 CTR (All) 444. In a recent decision the Hon'ble ITAT Agra Bench in case of Haryana Bidi Udayog ITA No.212/Ag/2005 for A.Y. 2001-02 has decided the similar issue in favour of the assessee. I have gone through the order of assessment and also the submission made by the Learned A.R. and after considering the above facts as regards outstanding wages are concerned, it has been the practice of the appellant to pay wages late from last several years. The payment of wages is duly supported by labour payment register which has been verified by the A.O. Therefore, the addition of Rs.39,08,700/- does not survive which is hereby deleted.
Similarly additions of Rs.12,22,500/-. Rs.22,57,700/- and Rs.18,74,411/- towards liabilities relating to the Gitti, material, Gitti, hathturai, sand etc. is genuine as these expenses are not challenged and the A.O. has not pointed out if the cash payment has already been made to the suppliers and only bogus liabilities are appearing in the balance sheet. The case of the A.O. is that the suppliers are not persons of means but this presumption has no realistic basis on one hand, while on the other hand even a person with no substantial means may be involved in supplies of goods late and may receive payments depending upon the facts and circumstances. It is for the A.O. to establish whether the expenses claimed are excessive or payments towards expenses have been made earlier and entries in the books have not been done. The A.O. has not rejected books, shows that they are correct. Hence the additions of Rs.12,22,500/-, Rs.22,57,700/- and Rs.18,74,411/- are also hereby deleted."
18. We have heard the ld. Representatives of the parties and records perused. The ld. A.R. filed a comparative chart of the result of computation of position of labour and material expenses but that does not help the assessee as the case of the A.O. was that these were outstanding liabilities for which the assessee has failed to prove that these liabilities were in fact outstanding. Further, the assessee failed to 14 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
prove genuineness of these liabilities. The CIT(A) deleted the said addition on the ground that the A.O. himself accepted the expenditure whereas the A.O. in his order clearly held that the expenses claimed by the assessee is unverifiable and he is not making separate addition as he made the addition on account of bogus liabilities. The relevant finding of the A.O. is produced from page no.6 as under :-
"The following liabilities are standing on account of purchase of gitti, hathturai, sand material and labour etc. on purchases of supply of gitti etc.
(i) Rs.34,80,200/-
(ii) Rs.18,74,411/-
(iii) Rs.39,08,700/-
The assessee has incurred expenses during financial year 2005-
06 on account of labour payment and purchase of gitti etc. The purchases of gitti, sand, have been made without vouchers. The payment to the purchasers have been made below Rs.20,000/-. The purchases on account of gitti etc. and labour to the extent being unverifiable and mentioned as below are disallowed.
(i) Rs.34,80,200/-
(ii) Rs.18,74,411/-
(iii) Rs.39,08,700/-
The separate additions on account of disallowance on these expenses is not being made in trading account because addition has already been made on account of unconfirmed/bogus liability outstanding as on 31.03.2006 in Balance-sheet."
19. In the light of the facts, the CIT(A) was not correct in deleting the addition. There is no other argument or explanation in respect of finding of the A.O. In the 15 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
light of the facts, the order of A.O. is required to be restored as the assessee has failed to furnish satisfactory explanation regarding huge outstanding balances on account of various expenses discussed above. We, therefore, set aside the order of CIT(A) and restore the order of A.O. and addition of Rs.39,08,700/- on account of outstanding wages, Rs.22,57,700/- on account of unconfirmed/bogus liability, Rs.12,22,500/- on account of liability where confirmation letter not filed and Rs.18,74,411/- on account of unexplained unconfirmed liability are confirmed. Therefore, ground nos.1, 2, 3 & 4 are decided in favour of the Revenue as above.
20. Ground no.5 is in respect of deletion of addition of Rs.7,08,444/- on account of work in progress. During the assessment proceedings the A.O. called the detailed closing stock including work in progress. The information received from MPRRDA that the assessee received contract receipt for Rs.7,08,444/- on 31.05.2006 but working of this amount was not done by the assessee during the F.Y. 2005-06 relevant to A.Y. 2006-07. The assessee submitted before the A.O. that the said amount is included in work in progress amounting to Rs.26,38,639/-. The amount received in the year 2006-07 and same has been considered as contract receipt in the year 2006-07. The A.O. made addition of Rs.7,08,454/- observing as under :- (A.O. page no.7) 16 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
"The assessee was specifically asked vide this office letter dated 18.11.08 to furnish details of closing stock in the following proforma :-
1. amount of WIP
2. basis for work in amount of WIP
3. name of department for which WIP is computed
4. Details of other loose material in quantity, rate and value and basis on which this valuation is adopted.
The assessee has failed to furnish the details of closing stock as called for in the proforma as above. The contention of the assessee that amounting to Rs.708444/- is included in the WIP amounting to Rs.2638639/- is not acceptable because the assessee has failed to explain as how this amount is included in WIP of Rs.26,38,639/-. Further, if this amount was included by the assessee in closing stock as on 31.3.06, this amount should be appearing in the debit side of Balance-sheet in the name of MPRRDA, Raisen. There is no entry appearing in the debit side of Balance-sheet for the amount of Rs.708444/- in the name of MPRRDA, Raisen. Hence, this amount of Rs.7,08,444/- will be treated as WIP of the assessee for the assessment year 06-07."
21. The CIT (A) deleted the said addition as under :- (CIT(A) page no.8) "I have gone through the basis of addition of Rs.7,08,444/- made by the A.O. and I have gone through order and submission of the Learned A.R. It is apparent from records that the appellant has shown work in progress Rs.26,38,639/- and is also accepted by the Learned A.O. The amount of Rs.7,08,444/- is out of the said work in progress as stated by the Learned A.R. cannot be brushed aside as such. It was therefore for the A.O. to estimate work in progress and if it was more than Rs.26,38,639/- as declared by the appellant, the same could have been added. On the principles of accounting also the appellant is correct, as the bills are not issued the amount cannot be shown as Sundry Debtors in the name of MPRRDA Raisen. Notwithstanding the same, the entry in WIP or receivable amount would not effect the quantum of profit anyway and hence there was no issue involved for an addition in income on this score. The addition of 17 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
Rs.7,08,444/- is, therefore, not justified and the same is hereby deleted."
22. We have heard the ld. Representatives of the parties and records perused. It is important to note that before us also the assessee has failed to furnish any evidence in support of the contention that the work in progress of Rs.26,38,639/- includes this amount of Rs.7,08,444/-. The CIT(A) without verifying the fact deleted the addition merely by accepting submissions made by the assessee. As per the detailed discussion which were made while deciding appeal for A.Y. 2005- 06 in paragraph nos.6 to 9 of this order wherein it has been held that the law of mandate provides that a person possessing the relevant material and not furnishing before the Court, an adverse inference can be taken as held by Hon'ble High Court of Madras in the case of CIT vs. Krishna Veni Ammal, 158 ITR 826 (Mad). Following the said discussion, the addition of Rs.7,08,444/- is warranted for want of explanation as per the above law of evidence. In the light of the fact, we set side the order of CIT(A) on the issue and restore that of the A.O. and confirm the addition of Rs.7,08,444/- made by the A.O.
23. As retards the decision cited by the ld. A.R. of which copies has been placed in Paper Book in the case of CIT vs. Gotan Lime Khanij Udhyog, 256 ITR 2453 (Raj), Order of I.T.A.T. Agra Bench in ITA No.117/Agr/2008 order dated 18 ITA Nos.270 & 415/Agr/2009 A.Ys. 2005-06 & 2006-07 .
13.02.2009 and I.T.A.T., Hyderabad Bench in the case of Vishal Infrastructure Limited vs. ACIT, 104 ITD 537 (Hyd) which do not help the assessee as those cases have been decided considering the facts of the respective cases which are not similar to the facts of the case under consideration. In those judgements/orders, the issue related to invoking provisions of section 145(3) of the Act and made addition. In the case under consideration, the case of the A.O. is not rejection of the books of account and estimation of income. Thus, those decisions are distinguishable on facts. In the light of the above discussion, this ground of the Revenue is also allowed. Thus, the appeal of the Revenue is allowed.
24. In the result, ITA No.270/Agr/2009 for A.Y. 2005-06 of the Revenue is partly allowed and ITA No.415/Agr/2009 for A.Y. 2006-07 of the Revenue is allowed.
(Order pronounced in the open Court)
Sd/- Sd/-
(BHAVNESH SAINI) (A.L. GEHLOT)
Judicial Member Accountant Member
PBN/*
19 ITA Nos.270 & 415/Agr/2009
A.Ys. 2005-06 & 2006-07
.
Copy of the order forwarded to:
1. Appellant
2. Respondent
3. CIT (Appeals) concerned
4. CIT concerned
5. D.R., ITAT, Agra Bench, Agra
6. Guard File.
By Order
Sr. Private Secretary
Income-tax Appellate Tribunal, Agra
True Copy