TaxTMI 
TaxTMI 
2012 (10) TMI 393
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....een accounted for by the assessee in the account books. 2. On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs. 12,50,000/- made on account of investment made in Uchanti purchases represented by sales of Rs. 13,14,880/- on 28-04-1998 contrary to the judgment of Delhi High Court in the case of CIT Vs. L.A. Medica 250 ITR 575. 3. On the facts and circumstances of the case, the Ld. CIT(A) has erred in directing to work out profit to the extent of 4.78% of Rs. 12,570/- and 3.84% of Rs. 14,80,019/- thereby allowing relief of Rs. 11,970/- and Rs. 14,23,187/- for the assessment year 1999-2000 and 2000-2001 respectively without appreciating the facts that the true nature of receipt as emanated from the sale bills, was sales-tax collected from traders which cannot be considered as sales as held by Ld. CIT(A). 3. In its appeal, the assessee has raised following grounds: "1. The Ld. CIT(A) has erred both on facts and in law in rejecting the sales returns as per the books of accounts and recording a contradictory finding of estimating the sales returns at 20% of the sales for the financial years 1998-1999 and 1999- 2000, against the d....
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....n sales as discussed above as per para 27 Rs. 44,24,130/- Sales Tax collected from the traders but not paid to the Govt. as per para 28 Rs. 12,570/- Undisclosed income on account of suppression of sales as discussed in para 31 Rs. 3270/- Addition on account of undisclosed investment as per para 30 Rs. 12,50,000/- Rs. 56,89,970 (a) 2. Asstt. Yr. 2000-2001 Undisclosed income on account of suppression sales as discussed above as per para 27 Rs.11589442/- Sales Tax collected from the traders but not paid to the Govt. as per para 28. Rs. 1480019/- Rs.13069461 (b) Add: Undisclosed income as declared by the assessee in the block return for the A.Y. 2002-03 Rs. 115285 (c) Total undisclosed income for the block period (a+b+c) Rs. 1,88,74,716/- 3.1. Thus the additions were made mainly on account of: (i) Suppressed sales (assessee's goods return claim was rejected) (ii) Investment in uchanti purchases (seized paper dated 28-4-98) (iii) Sales tax collected but not paid. 3.2. In first appe....
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....000 and 2000-01. 3.5. In sum and substance CIT(A) accepted the calculation and duplication mistakes. G.P. rate adopted by Assessing Officer @ 4.78% for A.Y. 1999-2000 and 3.84% for A.Y. 2000-01 was upheld by CIT(A). 3.6. Apropos sales out side the books of account, CIT(A) gave the partial relief by following observations: "12. The evidence of sale outside the books of account is also found in the seized material vide para 31,32 and 35 of A.O's order. This nails the appellant's contention that there was no evidence of sales outside the books of account. As discussed above in para 7 ibid, the fact of sales return has to be accepted only a limited and reasonable extent. In the financial year 1998- 99, the sales return which was shown at 26.15%, has been skewed to 64.72% in the financial year 1999-2000. On a careful consideration, I allow a maximum of 20% of sale returns for both the financial year 1998-99 and 1999-2000. Hence, the undisclosed sales/ concealed sales for the financial years 1998- 99 and 1999-2000 are reduced as below: Reduction allowed in r/o F.Y. 1998-99 F.Y.1999-2000 i) 20% sale return 1,34,94,108 (20% of Rs.67470540) 5,56,97,88....
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....n view of these facts, there would be no addition of Rs. 12,50,000/-. The appellant gets a relief of Rs. 12,50,000/-. 5. Both the parties are heard on the issue, who referred to various pages of the paper book. Apropos assessee's first ground, ld. counsel contends that the goods return claim was according to books of the assessee. It was supported by confirmations from customer. It should have been allowed as per books. 6. Ld. CIT(DR) vehemently argues that the assessee did not produce books before the lower authorities, despite being called again and again. The same were not produced before ADIT also and at the fag end of the proceedings, the books were produced. From the seized material it was found that the assessee was indulging in wide spread sales out of books. To protect itself unbelievable sales return of 26.15% in F.Y. 1998-99 and 64.72% in F.Y. 1999-2000 were claimed. It is unbelievable that assessee sent so much defective vanaspati ghee to its customers. 6.1. Apropos Uchanti sales, it is contended that the sales of Rs. 13,14,880/- were made by assessee on 28-4-1998. These sales were neither accounted for nor the corresponding purchases. For effecting such huge s....