TaxTMI 
TaxTMI 
2001 (8) TMI 294
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....AO neither pointed out any defects in the books of account maintained by the assessee nor specifically invoked the provisions of s. 145 of the Act. He has, therefore, contended that the trading addition made in this case without rejecting the books of account and invoking the provisions of s. 145 was not justified. In support of this contention he has cited Dy. CIT vs. Mewar Textiles Mills Ltd. (1998) 64 TTJ (Jp) 502, Vinod Kumar Pramod Kumar vs. ITO (2000) 66 TTJ (Jd) 722, Ganesh Foundry vs. ITO (2000) 67 TTJ (Jd) 434, Prabhu Dayal Lallu Ram vs. ITO (1999) 63 TTJ (Del) 557, Shankar Rice Co. vs. ITO (2000) 67 TTJ (Asr) (SB) 84 and ITO vs. Satya Narayan Pareek (2000) 71 TTJ (Gau) 997. It is, however, observed from the order of the AO that sp....
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....n the books of account of the assessee on the basis of detailed facts and figures given in his order which tantamount to the rejection of book results and invoking the provisions of s. 145. 5. On merits the learned counsel for the assessee has submitted that while working out the surplus Bardanas/gunny bags the AO presumed that two bags are consumed for manufacturing 3 Kattas. In this regard he pointed out that considering the size of bag (44" x 28") vis-a-vis the size of a Karta (36" x 24") it is impossible to obtain 3 Kattas from two bags both lengthwise and widthwise and only one Katta can at the most be obtained from one bag. In support of this contention he also produced sample of gunny bag and Katta before us to demonstrate that it i....
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....sel for the assessee has submitted before us that these bags are consumed by the assessee for the following purposes: (i) Some bags are damaged and get worn out in transit as the bags are old. (ii) Dal is sold in Kattas (half bags). Labour is employed to prepare Kattas out of old gunny bags. In the process of cutting, several bags get destroyed on account of holes in the bags. (iii) Old bags are spread on the floor of factory for recovery of wet Dal and spread over splits. (iv) The wet whole pulses before removal of skin is spread on long platforms during the night and covered by old Bardanas to provide heat and in the process, the old bags so used, are destroyed after their use twice or thrice. (v) The split pulses after removal of ou....