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12 After hearing both the parties we find that during assessment proceedings the Assessing Officer noticed that though the assessee has surrendered a sum of Rs. 3.50 crorres as additional income but return was filed only for Rs 37,50,570/-. He noted that the assessee has shown business loss to the tune of Rs. 2.66 crores which is more than the double over the loss declared by the assessee at Rs. 1.23 crores in earlier year. It was further noticed that the assessee has disclosed sale turnover of Rs. 22.70 crores against his turnover of Rs. 47.88 crores in the last year. The assessee was confronted with these issues and in response various details were filed. According to the Assessing Officer the assessee has not given any reply for decrease in turnover. According to Assessing Officer perusal of documents raise following important issues:

Surinder Kumar Charanjit Kumar, 282 ITR 78 (PH) Dhanesh Gupta and Co. V CIT, 327 ITR 246 (DHC) CIT V Surinder Pal Na yar, 327 ITR 236 (PH)

15 On the other hand, Ld. Counsel for the assessee submitted that all the requisite details were filed before the Assessing Officer. It was particularly explained that turnover has decreased because there was some family dispute and out of two units owned by the assessee-company located in the State of Punjab and State of Himachal Pradesh, the unit located in Himachal Pradesh was sold to the partnership firm in the family settlement. He also vehemently argued that it is not possible to estimate higher turnover and apply a particular profit rate without pointing out any defect in the books of account and then reject the same. The Assessing Officer has simply made general observations. The assessee is mainly engaged in the business of manufacturing transformers which are being sold only to the P.S.E.B and it is not possible to sell such transformers out of books because the Boards are only Govt agencies.