2020 (2) TMI 722

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....appeal No.CIT(A)-48/I.T.147 to 150 and 152/DCCC-2(2)/2017-18 dated 30/05/2018 (ld. CIT(A) in short) against the order of assessment passed u/s.143(3) r.w.s. 153 of the Income Tax Act, 1961 (hereinafter referred to as Act) dated 27/12/2017 by the ld. Dy. Commissioner of Income Tax, Central Circle-2(2), Mumbai (hereinafter referred to as ld. AO). 2. The only common issue involved in all these appeals is as to whether the addition on account of deemed unaccounted scrap sale could be made in the facts and circumstances of the case and whether the ld. CIT(A) was justified in reducing the said addition for each of the assessment years under consideration. 3. We have heard rival submissions and perused the materials available on record. We find....

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....in scrap sales made out of the books by the assessee which are retained in the form of cash balance. Based on this, the ld.AO made addition towards unaccounted scrap sale by estimating the sale of scrap at 0.162% on total sales and after deducting the scrap sales declared by the assessee in the return of income, he made addition for the difference towards unaccounted scrap sales for various assessment years in appeal before us as under:- AY Total sales Amount of scrap sale as per return Estimated sale of scrap (0.162% of total sale)  Unaccounted scrap sales 2010-11 89,19,11,375 2,15,179 14,44,896 12,29,717 2011-12 147,31,61,885 4,11,516 23,86,522 19,75,006 2012-13 210,62,87,865 9....

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....) (B) - (C) = (D) 2010-11 14 lakhs 2,15,179 11,84,821 2011-12 20 lakhs 4,11,516 15,88,484 2012-13 24 lakhs 9,54,450 14,45,550 2013-14 28 lakhs 14,80,281 13,19,719 2015-16 30 lakhs 13,58,614 16,41,386 3.3. We find the only basis of making this addition towards unaccounted scrap sale was the statement recorded from the cashier of the assessee company which was also confirmed by the Director of the assessee company when he was confronted with the statement given by the cashier. Barring this statement, no other material was found at the time of search or survey by the revenue. Hence, the sole issue that remains to be adjudicated is whether unaccounted scrap sale addition could at al....

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....the whole basis of placing reliance on a document which does not pertain to the year under consideration itself makes the addition on a weaker footing. 3.6. We find based on the estimation of scrap sale made for A.Y.2015-16 in the sum of Rs. 30 lakhs, the ld. CIT(A) had back worked and arrived on the estimated scrap sale for Rs. 28 lakhs for A.Y.2013-14; Rs. 24 lakhs for A.Y.2012-13; Rs. 20 lakhs for A.Y.2011-12 and Rs. 14 lakhs for A.Y.2010-11. For none of these estimations, there was any basis furnished by the ld. CIT(A). However, considering the totality of facts and circumstances of the case and the survey conducted in the premises of the assessee, we hold that the assessee would be entitled for relief of 50% of the total additions m....