TaxTMI 
TaxTMI 
2011 (3) TMI 901
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....l was admitted by this court for determination of the following substantial question of law : "Whether the Tribunal erred in law in taking only profit of unexplained transactions as undisclosed income instead of taking investment in the said transactions into account ?" 3.The facts, in brief, necessary for adjudication as narrated in the appeal are that the assessee is engaged in the business of a commission agent and he derives income by way of commission from the sale of vegetables and fruits on behalf of farmers and traders. During the course of survey under section 133A of the Act, carried out at the business premises of one Jagdish Chawla, the proprietor of M/s. Sai Baba Fruit Company, Chandigarh, certain documents ....
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....by order dated April 28, 2005. 6. This is how the Revenue is in appeal before us. 7. We have heard learned counsel for the parties and have perused the record. 8. The sole point for consideration in this appeal is that once the Revenue had come to the conclusion that the assessee had made sales of apples amounting to Rs. 5,75,654 to one Jagdish Chawla, whether it was the entire amount, or the 5 per cent. profit thereof, being commission on such sale, that was to be added to the income of the assessee. 9. According to the Revenue, the judgment of the Gujarat High Court reported in President Industries' case [2002] 258 ITR 654 (Guj), was not applicable and the entire sale amount was assessable in the ha....
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....es of Sh. Jagdish Chawla, Prop. M/s. Sai Baba Fruit Company, SCF 23, Sector 26, Chandigarh on November 6, 1998, you have sold apples worth Rs. 5,75,654. An examination of books of account shows that all the sales made to Sh. Jagdish Chawla have not been entered. I am also showing you the documents which are on the writing pad of your concern, M/s. Sanjay Chhabra Traders. All the sales made to Sh. Jagdish Chawla are entered on these documents. What you have to say in this regard ? Answer : In this regard I am to submit that from SCF 22, Sector 26, Chandigarh, my father Sh. Mangal Sain and brother Sh. Hemant Kumar were also running business besides my business. The details of which are as under : Sr.No. Name of Proprietor Name....
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.... It is observed that the appellant has not been able to discharge the onus by bringing any concrete evidence to substantiate the claim that the transactions were not made by him. However, at the same time, I find force in the contentions of the appellant that at best, it is only the profit arising from the sale of the goods, which can be added. In this context, the appellant has rightly drawn my attention to the judgment of the hon'ble Gujarat High Court in the case of CIT v. President Industries [2002] 258 ITR 654 (Guj), wherein it has been held that (headnote) : 'The amount of sales could not represent the income of the appellant who had not disclosed the sales. The sales only represented the price received by the seller of the ....
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.... appreciation of material on record, concluded that the investment in the purchase of apples was accounted for in the books of account of the assessee. Learned counsel for the assessee was asked to show whether the amount which was involved in the value of the applies, i.e., Rs. 5,75,654, was entered in the books of account or whether the father of the assessee, Shri Mangal Sain had made sales of apples during the financial years 1997-98 and 1998-99 to Jagdish Chawla and had surren- dered the income earned by means of those transactions, in his return of income filed with the Income-tax Department. The learned counsel was unable to substantiate his claim and to show that the amount was either entered in the books of account or was ever surr....