2015 (10) TMI 77

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.... on account of difference in sales as declared by the assessee to the sales tax authority and as shown in the P & L Account by treating the same as un-recorded sales. 2. The assessee in the present case is a company which is engaged in the business of manufacturing and sale of Ceramic Pipes which are mostly used in underground drainage system. The return of income for the year under consideration was filed by it on 28.10.2005 declaring total income of Rs. 10,42,830. During the course of assessment proceedings, it was noticed by the A.O. that the turnover as per the declaration filed by the assessee before the sales tax authorities was Rs. 1,65,94,793 as against the turnover shown by the assessee in the P & L account of Rs. 1,53,37,105. H....

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....ounts are audited. The discrepancy as presumed by the AO in fact is not there. The turnover as per sales tax asst. order that is received subsequently is Rs. 1,66,66,050. This turnover includes the following: 1. Value of Firewood - Rs. 5,91,140 2. APGST - Rs. 5,03,441 3. CST - Rs. 1,70,070 4. Packaging Material Rs. 68,915   Total Rs.13,33,566   If this amount of Rs. 13,33,566 that is included in the turnover is excluded the turnover comes to Rs. 1,53,32,484. As against this, we have admitted sales of Rs. 1,53,37,105. Besides this the Firewood is debited to P & L Account, the APGST and CST is paid to the Government except for the amounts of Rs. 9,796 under APGST and Rs. 9,758 under....

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....over is Rs. 1,66,66,050. Hence, there is no dispute in determination of the turnover by the AO. Moreover, the assessee also directed to pay the taxes on the net turnover @ 8% and 4% of Rs. 5,66,920 apart from the exempted sales of Rs. 50,91,210/-. If the assessee's contention will be taken into consideration, the turnover of the assessee would be as under : The turnover determined by the Commercial Tax Officer vide his Order dt.20.03.2006 Rs.1,66,66,050 Add: Sales Tax & APGST & CST Rs. 6,68,365   Rs.1,73,34,415   For the purpose of determination of turnover, the turnover includes APGST & CST. Hence, the turnover of the assessee may be Rs. 1,73,34,415." 4. After considering the submissions made by the ....

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....3,37,105.     6. Although the learned D.R. has contended that different explanation has been offered by the assessee at different stages while explaining the difference between the turnover as declared to the sales tax authorities and to the income tax authorities, we are of the view that the explanation offered by the assessee reconciling such difference before us is required to be finally considered on merit in the light of relevant documentary evidence produced by the assessee in support. As pointed out by the Ld. Counsel for the assessee in this regard from the relevant assessment order passed by the concerned sales tax authority placed at page Nos. 5 to 8 of the paper book, purchase of fire wood amounting to Rs. 5,91....