TaxTMI 
TaxTMI 
2017 (4) TMI 1057
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....er dated 02.11.2011 (hereinafter referred to as the 'impugned appellate order'), passed under section 250(6) of the Act by the Ld. Commissioner of Income Tax (Appeals)-II, Dehradun (the 'Ld. CIT(A)'), is erroneous, arbitrary, based on surmises and conjectures, assuming incorrect facts and hence is illegal and bad in law. 2. That on the facts and circumstances of the case, and in law, the Ld.CIT(A) has erred in confirming the additions of Rs. 1,52,538/- (on account of stock shortage) and Rs. 2,43,500/- (out of total disallowance of Rs. 373500/- made by the Ld.AO, on account of unexplained investments, being certain entries recorded on a loose parcha), without appreciating the facts and evidences submitted before him as well as the A....
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....he assessee furnished another explanation by way of reconciliation between stock physically found at the time of survey and stock as per books of the assessee at the time of survey. The Assessing Officer (in short "AO") rejected this second explanation of the assessee as being an after thought. In the assessment order dated 21.12.2009, the AO added the aforesaid amount of Rs. 1,52,538/- to the income of the assessee. The ld.CIT(A) confirmed this addition, vide impugned appellate order dated 02.11.2011. (B.1). The AO also made an addition of Rs. 3,73,500/- on the basis of loose paper found at the time of aforesaid survey u/s 133A of the Act. The relevant notings under loose paper contain entries of Rs. 17,000/-, Rs. 1,20,000/-, Rs. 80,000....
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.... authorities should have examined the stock reconciliation provided by the assessee on merits, he contended. Without prejudice to this contention, the Ld. counsel also submitted that instead of making an addition of the entire amount of Rs. 1,52,538/- on account of suppressed sales, the addition should have been restricted to the gross profit earned on the alleged suppressed sales, and in support of this, Ld. Counsel relied on the decision of Pune Bench of ITAT in the case of Janta Tiles vs ACIT in IT(SS)A No.-144/Pune/1996 dated 06.04.1999 [2000] 66 TTJ 0695. On this issue, the Ld.CIT Departmental Representative (in short "DR") appearing for the Revenue stated that the credibility of the stock reconciliation furnished by the assessee to AO....
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....or only the gross profit earned on such alleged suppressed sales is to be added as assessee's income. This issue is restored with the aforesaid directions to the file of the Ld. CIT(A) for fresh order as per law. (C.1) As far as the aforesaid addition of Rs. Rs. 2,43,500/- is concerned, the ld. Counsel for the assessee contented that the loose paper on the basis of which this addition is made is a 'dumb' document as it is undated and unsigned, and no adverse inference should be drawn against the assessee on the basis of it. The Ld. counsel cited a few case laws in support of this contention including (i) CIT vs Vineet Aggarwal (2015) 121 DTR 241 (Delhi); (ii) Chander Mohan Mehta vs ACIT [1999] 71/ITD/245 [Pune]; (iii) D.D.Malhan vs DCIT ....
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.... the order of the Ld.CIT(A). We have heard both sides patiently. We have also carefully considered the materials on record and the precedents brought to our attention. The assessee has filed a Paper Book before us containing 10 pages which includes the copy of the assessee's reply filed before the AO and copy of assessee's submissions filed to Ld.CIT(A). The contention raised on behalf of the assessee by the Ld. counsel, therefore, that the addition has been made on the basis of "dumb document" cannot be accepted at this stage in view of the fact that the assessee has already owned up this document during assessment proceedings and during appellant proceedings before Ld.CIT(A). The assessee has already furnished explanation and supporting e....
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.... chose to consider the aforesaid amount of Rs. 4,53,500/- and not the aforesaid net amount of Rs. 3,73,500/-; and from perusal of the order of the Ld.CIT(A) there is no mention that any opportunity was given by him to the assessee for taking this step. In view of these facts and circumstances, we are of the view that the order of Ld.CIT(A) is a nonspeaking order and has been passed without giving reasonable opportunity to the assessee. In the fitness of things, therefore, we set aside the order of Ld.CIT(A) and restore this matter to the file of the Ld.CIT(A) for fresh orders on this issue. The Ld.CIT(A) is directed to pass a speaking order giving reasons for why the explanation/evidences furnished by the assessee before AO and before Ld.CI....