TaxTMI 
TaxTMI 
2018 (8) TMI 189
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.... years on merits as well as by the assessee in the assessment year 2011-12 are summarised as under: - Nature of Addition made by the AO 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Personal expenses 5,23,970 4,77,263 6,16,841 5,43,453 29,52,758 19,93,202 Bogus purchases made from Nitin Enterprises 27,15,435 40,77,004 2,19,48,700 89,49,347 2,52,67,172 2,11,70,553 Unexplained purchases made from Kiran Furniture 1,87,375 8,17,996 14,28,290 9,88,687 2,54,685 1,03,39,624 Disallowance u/s 40A (3) 5,00,973 2,55,101 12,05,538 - - - Unexplained Cash found - - - - - 6,68,483 Disallowance on account of Tour Travelling, repairs, depreciation on car etc. - - - - - 6,65,138 Sale of Scrap - - - - - 1,74,23,441 3. Whereas on merits the assessee has challenged in the appeal for assessment year 2011-12 following two additions: - i) Addition on account of scrap sales: Rs.1,16,15,628/- ii) Disallowance on account of low declaration of income: ....
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....rial placed on record it is seen that assessee before the Ld. CIT (A) has challenged the validity of the additions made u/s 153A on the ground that, firstly, no incriminating material was found during the course of search so as to enable the AO to make the addition on the impugned issues in the assessment passed u/s 153A; and secondly, they have already been considered in the assessment completed earlier and had attained finality. This ground has been raised vide ground Nos. 1 & 2 before CIT(A) in all these years, which has been decided against the assessee in a very detailed manner, which for sake of ready reference is reproduced hereunder: - "6.1 From a plain reading of section 153A it is evident that it requires the Assessing Officer to assess or re-assess the total income of six assessment years immediately preceding the year of search. There has been lot of debate and judicial controversy regarding the nature of assessment or re-assessment proceedings to be undertaken u/s 153A. Legislature requires the Assessing Officer to assess or re-assess the total income of pending six assessment years. The words 'total income' has been used under clause 'b' of se....
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....sment made under this section.' 6.4 Thus, it is clearly implies that the nature of assessment or reassessment to be made under this section 153A shall be governed by the normal provisions of the Act. In case it is an assessment made for the first time, all principles of assessment which are applicable to assessment under section 143(3) shall become applicable and in case if a re-assessment is being made, all the principles of re-assessment which are applicable in the case of proceedings under section 147/148 shall become applicable. 6.5 The provisions contained under section 153A are not comparable with the nature of provisions contained under chapter XIVB regarding block assessment proceedings. Concept of block assessment under chapter XIVB was altogether different. It was a special procedure of assessment for search cases to be made relating to only undisclosed income. There was then the concept of dual assessment proceedings. Normal assessment proceedings for other than undisclosed income used to be undertaken independently and simultaneously. Section 153A does not contain any such special procedure to assess undisclosed income found as result of search, ra....
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....y assessed for preceding six years with respect to his total income. Therefore, enquiries can be made relating to all the issues during section 153A assessment proceedings. 6.7 In view of the above it is held that the assessment proceedings pursuant to notice u/s 153A are not intended to be restricted to make assessment of undisclosed income only detected as a result of search but normal assessment proceedings for other than undisclosed income can be undertaken independently and simultaneously. Delhi Bench of ITAT in the case of Shivnath Rai Harnarain (Indian) Ltd. v. Dy. CIT [2009] 117 ITO 74 wherein it has been held as under: "In view of our above analysis of the provisions of sections, the contentions of the learned counsel for the assessee have no force because there is no requirement for an assessment made under section 153A of the Act being based on any material seized in the course of search. Further, under the second proviso to section 153A pending assessment or reassessment proceedings in relation to any assessment year falling within the period of six assessment years referred to in section 153A(b) of the Act shall come to an end (abate), which means tha....
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....d the scope of jurisdiction u/s 153A is rejected. Hence this ground of appeal dismissed." 8. However, on merits all the additions have been deleted by Ld. CIT(A) and that is why assessee was not aggrieved by the outcome of the judgment and hence there was no reason to file any appeal. 9. Rule 27 of Appellate Tribunal Rules, 1963 provides that: "27. The respondent, though he may not have appealed, may support the order appealed against on any of the grounds decided against him." The aforesaid rule gives the liberty to the respondent to support the first appellate order on any of the ground decided against him, that is, the respondent can raise a defence upon the order filed by the appellant on any of the grounds which have been decided against him. The appellant before the first appellate authority may raise many arguments in an appeal to plead his case and if one of the lines is accepted and other is rejected, then in the second appeal filed by the respondent (of the first appeal and now the appellant), then the respondent has a right to defend that part which was adversely decided. Here the issue of scope of addition in terms of assessment completed u/s 153A has ....
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....siness and residential premises of the assessee on 19.10.2010 and accordingly notices u/s 153A were issued on 27.9.2012, which also included for the assessment years 2006-07 to 2008-09. In all these years return had been filed on the due date u/s 139(1) and in the assessment years 2006-07 and 2008-09, the assessment order u/s 143(3) was passed much prior to the date of search and such an assessment order cannot be said to be abated in terms of second proviso to section 153A. In so far as assessment year 2007-08 is concerned, the return income filed by the assessee had attained finality, because no notice u/s 143(2) has been issued as required within the stipulated time period which was 30.9.2008. Thus, it was submitted by the Ld. Counsel that for these three assessment years, assessments were unabated. He further pointed out it is an admitted fact that none of the additions made by the AO are based on any seized material or incriminating documents found in the course of search, which fact is not only evident from the assessment order but also not disputed by the Ld. CIT(A). The Ld. CIT (A) has decided this issue against the assessee on the ground that once notice u/s 153A is issued....
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....in the case of Pr. CIT Vs. Dharampal Premchand Ltd. (2017) 99 CCH 202 12. Thus, he submitted that none of the additions made by the AO can be sustained in the assessment year 2007-08, 2008-09 and 2009- 10. 13. On the other hand, Ld. CIT (DR), though did not rebut the assessee's contention that no incriminating material has been found qua the additions made by the AO in these assessment years, however she strongly relied upon the order of Ld. CIT (A) and on judgment of Hon'ble Kerala High Court in the case of E.N. Gopakumar vs. CIT (2016) 75 taxmann.com 215 (Kerala), wherein the Hon'ble Kerala High Court has taken note of all the judgments of Hon'ble Delhi High Court. Besides this she also relied upon following judgments: - i. CIT Vs Raj Kumar Arora [2014] 52 taxmann.com 172 (Allahabad)/[2014] 367 ITR 517 (Allahabad) where Hon'ble Allahabad High Court held that Assessing Officer has power to reassess returns of assessee not only for undisclosed income found during search operation but also with regard to material available at time of original assessment. ii. CIT Vs Kesarwani Zarda Bhandar Sahson Alld. [ITA No. 270 of 2014] (Allahabad), where Hon'ble A....
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....s relied upon by the parties. As discussed above, it is an undisputed fact that for the assessment years 2006-07, 2007-08 and 2008-09 the return of income was filed u/s 139(1) and order u/s 143(3) was passed much before the date of search, except for the assessment year 2007-08, wherein no notice u/s 143(2) was issued within the stipulated time period. Accordingly, on the date of search, i.e., 19.10.2010 the assessments for these assessment years have attained finality and hence has to be reckoned as unabated assessment in terms of second proviso to section 153A. Now under the jurisdiction of Hon'ble Delhi High Court it is a well settled principle that in the case of assessments which have attained finality and are non-abated assessment, then no additions can be made over and above the original assessed income unless some incriminating material has been found during the course of search qua that assessment year. This proposition has been well discussed in the judgment of CIT vs. Kabul Chawla, wherein their Lordships have also discussed the judgment of Shri Anil Kumar Bhatia (supra). After considering the various judgments the Hon'ble High Court have summarised the decisions in the ....
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....ed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in the course of original assessment." 15. The ratio laid down in the aforesaid judgment has been further reiterated on the Hon'ble Delhi High Court in the case of Pr.CIT vs. (supra) vs Meeta Gutgutia and catena of other cases as referred above. In so far as judgments relied upon by the Ld. CIT DR, same may not have binding precedence for the reason that; firstly, most of the judgments are distinguishable; secondly, majority of the High Court judgments are in favour; and lastly, jurisdictional High Court in series of judgment has reiterated the same principle. Thus, in view of the settled proposition laid down by the Hon'ble Jurisdictional High Court which is applicable on the facts of the present case also, we hold that all the additions made by the AO in the assessment years 2006-07, 2007-08 and 2008-09 are beyond the scope of assessment u/s 153A, because assessments for these assessment years had attained finality before the date of search and no incriminating material or seized documents....
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....disallowance. If the expenses debited are recorded in the regular books of accounts which have been incurred in the normal course of business and are subjected to various audits then such kind of disallowance cannot be upheld. He further held that expenses debited under the head business promotion expenses and staff labour and welfare expenses, printing and stationary and miscellaneous expenses are pre-dominantly associated in the execution of business activities and no personal expenses has been brought by the AO. Accordingly, he has directed the AO to allow the expenses. 20. After hearing both the parties and on perusal of the relevant finding in the impugned order, we find that assessee has filed entire details of expenses alongwith the relevant vouchers and audited books of accounts and had also informed the mode and manner of payment of such expenses. The very nature of these expenses debited shows that they have been incurred during the normal course of business and without pointing out any specific defect in the nature of expenses or specifying that such expenses were either for non-business purpose or for personal use, no adhoc disallowance can be made or sustained, espe....
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.... purchases made by appellant company. This vital fact though in the knowledge of the Ld. A.O. has neither been rebutted by him, nor has been discussed in the assessment order. (b) That the Ld. A.O. was unjustified in relying upon uncorroborated statement given by third party, recorded by some other authority, without independently verifying the same. (c) The Ld. A.O. was unjustified in relying upon statement recorded from third party at the back of the appellant, without granting copy of alleged relied statement to the appellant and without granting any opportunity to the appellant for cross examination. (d) The Ld. A.O. was unjustified in making disallowance of entire purchases made from such third party in absence of any evidence which could support that the purchases made were not genuine. (e) The Ld. A.O. was unjustified in making addition without rejecting the books of accounts. (f) The Ld. A.O. was unjustified in rejecting entire purchases and simultaneously accepting the liability on account of purchases made from M/s. Nitin Enterprises as genuine, acknowledged, confirmed liability and accepting cost of such purchases included in ....
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....make such addition. In support of his conclusion he has also referred to various judgments which have been incorporated at page 32 of his order. Thereafter he has given following finding of facts based on various materials which for sake of better appreciation is reproduced hereunder: - "13.5 Further, in the instant case, from the details on record, I find that the appellant produced complete books of account in the course of the assessment proceedings conducted by the Assessing Officer u/s 153A of the IT Act, 1961 which also included the stock register maintained by it in the regular course of business. The purchases made by the appellant from M/s Nitin Enterprises were found recorded in the stock register. Without pointing out to any discrepancy in the books of account maintained by the appellant, the Assessing Officer in an unreasonable and unjustified manner treated such purchases as bogus. There was no incriminating material found in the course of search operation u/s 132 pertaining to purchases made by the appellant. Without bringing any adverse material on record and without rejecting the books of account pointing to any discrepancy, making an addition by the Assess....
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....Mr. M.S. Vinod, one of the Directors of defendant company as also by learned counsel for the parties. This application is also supported by the affidavits of Mr. Nitin Bansal and Mr. M.S. Vinod. Alongwith this application the parties have also filed Deed of Settlement of Disputes dated 17.05.2012. The Deed of Settlement is marked as Exhibit C-1. 3. One of the authorized representatives of the defendant company is present in Court. He is duly identified by his counsel. The Director also identifies the signature of Mr. M. S. Vinod in the application as well as in the Deed of Settlement. He submits that he has seen Mr. M.S. Vinod write and sign. 4. Learned counsel for the defendant has handed over two cheques in the total sum of Rs. 55,58,927/- [(i) Ch. No. 433650 dated 1.7.2012, drawn on YES Bank in the sum of Rs. 25,58927/- and [ii] Ch. No.433648 dated 1.06.2012, drawn on YES Bank in the sum of Rs. 30,00,000/-] to counsel for the plaintiff in Court today in full and final settlement of all the claims. 5. Learned counsel for the parties submit that in view of the settlement arrived at between the parties' present suit may be decreed in terms of Deed of Sett....
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.... such adjustments / accommodation made for the appellant company. Therefore, the Assessing Officer failed to bring on record any adverse material to prove that the purchases made by the appellant were not genuine and were bogus, except a third-party statement in the course of survey u/s 133A which was contrary to the settlement deed passed by the Hon'ble High Court of Delhi. Considering the facts and circumstances of this issue, the Assessing Officer was not justified in treating the purchases made from M/s. Nitin Enterprises by the appellant as bogus. Accordingly, the addition made by the Assessing Officer amounting to Rs. 89,49,347/- on account of bogus purchases is deleted." 24. Before us Ld. DR strongly relied upon the order of the AO and submitted that once the said party has been found to be providing bogus bills and the partner has categorically admitted that the firm was providing bogus bills to the assessee after receiving the cheque and returning the same in cash, then it cannot be held that such purchases are genuine. 25. On the other hand, Ld. Counsel submitted that assessee had filed plethora of evidences like; a) Copy of Legal Notice dated 11.3.2011....
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....que from the assessee for the said bills in lieu of cash for the same amount returned back to the assessee. On the other hand, the assessee before the AO has given various documents like; i) copy of legal notice issued by M/s. Nitin Enterprises to the assessee for recovery of the dues relating to same purchases made by the assessee; ii) suit of recovery filed by M/s. Nitin Enterprises before the Hon'ble Delhi High Court; iii) copy of statement of account and reconciliation filed by M/s. Nitin Enterprises during the suit for recovery before the Hon'ble High Court confirming the transaction of purchase and balance amount recoverable from the assessee; iv) copy of ledger account and reconciliation of balance in the books of account of both the parties; and v) settlement deed between the assessee and M/s. Nitin Enterprises whereby parties have settled the dues which got ratified by the settlement order of the Hon'ble Delhi High Court. All these evidences have neither been rebutted nor has any adverse view been given by the AO. Apart from that, there is a categorical finding that the statement of Shri Nitin Bansal recorded by the survey parties was behind the back of the assessee and th....
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....job work performed along with the details of site and other information. The assessee has also classified this expenditure under the head job work charges. Not only that, TDS has also been deducted and deposited in the Government Treasury on the payment made to said party. There is nothing on record that either the alleged services have not been given by the said party or other evidences in the form of invoices and TDS certificate are not correct. The assessee had duly placed following record and information before the AO:- (a) Confirmed statement of accounts. (b) Invoices of the services rendered by M/s. Kiran enterprises (c) Permanent Account number of Mr. Kishore M. Mestry, Proprietor, M/s. Kiran Furniture. (d) The address of the Kishore M. Mestry, Proprietor, M/s. Kiran Furniture. (e) The mode of payments made. (f) Nature of services obtained, place where such service obtained and bills of services rendered raised by M/s. Kiran Furniture. (g) The Income tax returns of M/s. Kiran Furniture which duly reflected that the job charges received from the appellant were duly accounted for and income earned therefrom has bee....
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..... While making such disallowances, the Assessing Officer not only ignored all the material facts brought on record by the appellant, but also the nature of services rendered by M/s Kiran Furniture, and also the classification and disclosure made thereof in its audited books of account, which was furnished such as balance sheet and profit and loss account during the course of the assessment proceedings. In fact, one cannot ignore that the notices issued u/s 133(6) by the Assessing Officer on both the occasions were properly served upon the intended party and they were not returned to the sender un-delivered or with certain remarks by the postal authorities. This itself evidences the fact that the party existed and its identity was established. The Assessing Officer did not bring any adverse material on record to establish that such services were not rendered by M/s Kiran Furniture or that the same was not obtained by the appellant, or that the services obtained were not utilized for the business of the appellant. The Assessing Officer's action while making the impugned addition is contradictory to each other. On one hand, the entire job work charges paid were disallowed and on t....
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.... of the assessment proceedings u/s 153A, and it is also not a case where the credit balance due to M/s Kiran Furniture could be added under the deeming provisions of section 68 of the IT Act, 1961 without assigning the reason for making such an addition. It is also seen that nowhere and at no point of time, the Assessing Officer expressed his dissatisfaction pertaining to the identity, creditworthiness of genuineness of the transactions involved which is the primary ingredient laid down in the provisions of section 68. 16.2 In the instant case, on perusal of the material placed on record, I find that all the services obtained by the appellant were duly supported by invoices raised by M/s Kiran Furniture and the payments made by the appellant in respect of the services obtained were subjected to the provisions of chapter XVII. On perusal of the details of sundry creditors I find that M/s Kiran Furniture duly appeared in the list of sundry creditors of the appellant. Sh. Kishore Mahadeo Mestry, who is proprietor of M/s Kiran Furniture is being regularly assessed to income tax under PAN AGPPM57590 with the ITO Ward- 25(3)(2) Mumbai and his accounts were duly audited. The appe....
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....said finding is hereby confirmed. The grounds raised by the revenue in all the years are thus dismissed. 30. The next issue raised by the revenue in the assessment year 2011-12 is addition on account of unexplained cash of Rs. 6,68,483/-. The facts in brief are that during the course of search conducted on 19.10.2010 at the assessee's premises at A-37, Sector 80, Phase-IT, Noida (UP), it was found that it was shared by another entity, M/s. G.L. Litmus Events Pvt. Ltd. and other concerns. US Dollar $ 15,017 (equivalent to INR 6,68,483) was found by the search party from the said premises. When confronted to the assessee, it was explained before the search party that the said foreign currency was personal property of foreign nationals, namely, Mr. Alexander Vidal, Mr. Herve Chu and Mr. Victor Besa, who were employees of M/s. G.L. Litmus Events Pvt. Ltd. whose premises was also covered under the same search proceeding and Panchanama was also drawn in their names jointly. Nothing further was asked or queries were raised from the assessee and the search team being satisfied with the ownership of the Dollars released the same to the said foreign nationals instantly. However, durin....
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....sing Officer for not furnishing of confirmation is not only invalid but unreasonable also. From the details on record, it is seen that another group company M/s G. L. Litmus Events Pvt. Ltd. was also subjected to search and seizure operations u/s 132 of the IT Act, 1961 and thereafter it was centralized with the same Assessing Officer where the case of the appellant was also centralized. As the jurisdiction over both the cases i.e. M/s G. L. Litmus Events Pvt. Ltd. and that of the appellant were vested with the same Assessing Officer i.e. Central Circle-B. New Delhi, verification of submissions made by the appellant pertaining to M/s G. L. Litmus Events Pvt. Ltd. could have been made by the Assessing Officer rather than simply discarding them. The Assessing Officer did not bring any material on record to substantiate that the foreign currency found in the premises of the appellant belonged to the appellant only and it represented the undisclosed income. It is a matter of fact that the appellant's premises was also shared by M/s G. L. Litmus Events Pvt. Ltd. and that pursuant to the search a Panchnama was also drawn in the joint names of the appellant and M/s G. L. Litmus Events....
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....Rs. 6,68,483/- ($15,017) was the undisclosed income of the appellant which remained unexplained. As there is no justification for such an addition, I delete the addition of Rs. 6,68,483/-." 33. After hearing both the parties and on perusal of the relevant finding in the impugned order as well as material on record, we find that the assessee's stand consistently before the AO was that the foreign currency found from the premises of the assessee belong to different concern, namely, M/s. G.L. Litmus Events Pvt. Ltd. who have their office at the same premises and were also subjected to search. The investigation authorities concluded that the foreign currency neither represents undisclosed income of assessee nor of M/s. G L Litmus Events Pvt. Ltd., therefore, the same was released. Although whatever cash was found from the possession of the assessee the same was found to be reflected in the books of accounts. The assessee in the course of search itself has categorical stated that the cash in the form of foreign currency belonged to M/s. GL Litmus Events Pvt. Ltd., and without any other material to hold that the foreign currency belong to the assessee AO has held to be undisclosed inc....
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.... 75,20,586 Rental charges for providing electrical & other equipment for execution of CWG 7 24,68,681 Rental charges for Installation of wall structures at different sites of CWG 8 53,16,930 Rental charges for providing temporary office, air conditioners & furniture at ITO site. Total 5,80,78,138 2.1. The Ld. AO during the assessment proceedings enquired about the details of purchases made by the Appellant for the CWG and also regarding the scarp/residual value of the said materials purchased for the CWG. In connection to the same, it was explained to the AO. that the services and goods provided to M/s G.L. Litmus Events for CWG was provided out of common pool of the Appellant business and no separate purchases were made for the CWG. Thus it was explained that no such separate list of purchases and the resultant scrap/residual value of the same could be provided. 2.2. Also the Ld. AO noted that the Appellant had before the Settlement Commission surrendered Rs. 20,00,000/- as unaccounted income from scrap sale from material supplied for CWG project. In the said connection it was explained by the Appellant tha....
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....vided by the assessee. (b) That the assessee before Hon 'ble Settlement Commission had suo moto offered Rs. 20 lakhs on account of scrap sale for CWG project. (c) That the Settlement Application was filed on the basis of rough noting in the loose papers found in the desk of Mr. Rajender Kumar, Site Manager, subsequent to his death and much later to the date of search conducted on the assessee-company." 35. Before the Ld. CIT (A) also this issue was explained by the assessee as under:- (a) That the appellant-company had executed orders placed by M/s GL Litmus Events Pvt. Ltd. for the supply of temporary structures etc. on hire basis at various locations of CWG. All the sites were to be vacated immediately after the event, failing which heavy penalty was envisaged. The employee of the appellant-company, therefore, sold a lot of material as scrap to local scrap dealers resulting in cash sale of Rs. 16,78,340/-, which was written in the loose sheet recovered from the office desk of the Site Manager after his death and remained to be accounted for. (b) The scrap generated in the normal course of business has been sold in the respective years an....
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....ng on pages 48 to 50 of the appellate order. (i) That, therefore, the AO. on surmise & conjecture has made addition on lump sum basis of Rs. 2,90,39,069/-, being 50% of total value of services of Rs. 5,80,78,138/-, upon presumption of scrap sale without bringing on record any discrepancy therein or instances of alleged undisclosed sales brought on record during the assessment proceeding. 36. Ld. CIT (A) has given part relief after observing and holding as under:- "22.2...From the details on record, I find that the Assessing Officer considered the stock that was recorded in the books of account of the appellant to the extent it was classified to be re-used and, therefore, no addition was made on that account by him. In his submissions, the appellant itself expressed its inability to segregate useable and un-useable residue. Therefore, the Assessing Officer did not raise any question pertaining to the correctness of the books of account maintained by the appellant. Further, it is also matter of record that apart from the transactions recorded on the loose sheets found in the desk of the site manager Sh. Rajinder Kumar, no other incriminating material per....
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....e of that business activity akin to that of the appellant where 50% of the purchases can generate a scrap value. Therefore, the Assessing Officer is directed to modify the addition made by him to the tent of 20% of Rs. 5,80,78, 138/- and to pass a consequential order accordingly." 37. Before us Ld. Counsel submitted that the entire details of purchases made for CWG and scrap resale value of such goods were provided before the AO and in respect of scrap value of material used in CWG which the AO has presumed to have been sold. It was explained before him with reference to invoices raised for that purpose that the services for the supply of temporary structures etc. were on hire basis at various locations of CWG and goods were provided to M/s. G L Litmus Events Pvt. Ltd. out of common pool and no separate purchases were made for providing services / goods to the company. The assessee has also filed a chart describing the materials provided to M/s. G L Litmus Events Pvt. Ltd. and ultimate utilisation which were as under :- Bill No. Nature of sale /services as per bills raised Description of Rental Charges - Utilization of material & subsequent treatment of the sam....
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....represented in stock. During the course of search nothing was found evidencing scrap sale of Rs. 16,78,340/- and not disclosed in the accounts. Against that assessee has already offered Rs. 20 lacs. As far as purchases are concerned the same were part of stock duly disclosed and not disputed. Only rental income was earned by giving on hire such purchased goods in CWG which too has been duly accounted for. The amount of Rs. 16,78,340/- written on loose sheets found in the desk of Site Manager Shri Rajinder Kumar is beyond the knowledge of the assessee company after his death and only to give piece of mind , it has offered sum of Rs. 20 lacs on account of scrap sale to tax in the settlement application. AO also could not bring on record any such evidence to establish sale of scrap. Thus neither the AO nor Ld. CIT(A) are justified in either estimating the 50% of the total cost of service/ material provided to M/s. G.L. Litmus Events Pvt. Ltd. was restricted to 20% of such services. 38. On the other hand, Ld. DR strongly relied upon the order of the AO. 39. After considering the entire gamut of facts and material on record, we find that the impugned issue of sale of scrap has ari....
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....ry, it can be seen that; firstly, some of them were part of stock of assessee which are reflected in the books of account as stock as on 31st March, 2011; secondly, some of the equipments taken on rent from outside parties have been returned; thirdly, the labour charges for installation and dismantling cannot be said to have any scrap value; and lastly, some of the scrap has been stated to be sold in the next year which has been taken as income of the assessee. Under these facts, we find it very difficult to appreciate the stand taken by the AO and Ld. CIT (A) to estimate on adhoc basis, the sale of scrap material outside the books of account either by applying 50 % or 20%. More so, when all the invoices and details of services provided and purchases were duly supported by invoice and recorded in the books of accounts; and neither the books nor the trading results including valuation of scrap made has been disturbed. None of the authorities have examined this issue in a proper perspective. Therefore, in the interest of justice we feel that this issue needs to be remanded back to the file of the AO, who shall see; firstly, whether the stocks which are reflected in the books of accou....