TaxTMI 
TaxTMI 
2020 (10) TMI 1048
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....oduced before A.O. regarding the sundry creditors. Ld. CIT (Appeals) deleted the addition ignoring the above fact and accepting the explanation of the assessee without any basis. (iii) That, the Ld. CIT (Appeals) erred in law as well as fact in deleting the addition of Rs. 5,97,186/- which was added by the A.O. as unexplained capital introduction from undisclosed sources. (iv) That, the Ld. CIT (Appeals) has failed to notice the fact that the assessee was unable to submit any details explaining source of addition of such fresh capital introduction with documentary evidence during the assessment proceeding. During remand proceeding, the assessee could not explain before A.O. the source of such capital introduced. The Ld. CIT (Appeals) deleted the addition ignoring the above fact and accepting the explanation of the assessee without proper reasons. (v) That, the Ld. CIT (Appeals) erred in law as well as fact in deleting the addition of Rs. 83,62,872/- which was added by the A.O. on a/c of sale suppression of rice bran. (vi) That, the Ld. CIT (Appeals) has failed to appreciate the fact the said addition on a/c of sale suppression of rice bran was ma....
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....e the remaining effective grounds as ground Nos.1 to 13. 3. Brief facts of the case are that a search and seizure operation u/s. 132 of the Income tax Act, 1961 was conducted on 21.08.2013 in the business and residential premises of Maharaja Group of cases, Bargarh (M/s. Hotel Maharaja & Group). Simultaneously, survey operation was also conducted in the business-cum-office premises belonging to the assessee group. Since the search & seizure operation was conducted in this group cases during the financial year 2013-14 relevant to the assessment year 2014-15, the case of the assessee for the assessment year 2014-15 was taken up for scrutiny assessment by the AO u/s. 143(3) of the Income tax Act, 1961. Accordingly, the AO issued notice u/s. 142(1) of the Income tax Act, 1961 calling for the return of income of the assessee for the assessment year under consideration to be filed on or before the date specified in the said notice and served on the assessee for compliance. In response to the said notice, the assessee filed his return of income for the assessment year under consideration electronically on 21.09.2015 showing a total income of Rs. 13,00,990/- after claiming deduction und....
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....amount of interest received and the amount involved. 1. 2. 3. 4. 5- 6. 7. 8. 9. In this connection, it may be stated here that in response to the said notice and questionnaire, Sri Sudip Sawdia, advocate & the authorized representative of the assessee appeared on 14.10.2015 and filed acknowledgement copy of ITR-V, computation statement of income, Form No.26AS, copy of audited profit & loss account, balance sheet without schedules and premium paid certificate issued by LIC of India etc. However, other details and/or documents called for vide the said questionnaire were not filed. Thereafter, the case was posted for hearing on 23.10.2015. On 23.10.2015, there was no compliance on the part of the assessee. The assessee also not filed time petition. Accordingly, the case was fixed for hearing on 13.11.2015 and communicated to the assessee vide letter dated 02.11.2015. On .11.2015 there was again no compliance. Later, the assessee filed a time petition by speed post which was received in this office on 16.11.2015. Considering the said time petition, the case of the assessee was posted for hearing on 27.11.2015 at 4.00 PM.....
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...., whatsoever, to offer in this regard and therefore, it is proposed to treat the sundry creditors shown in different assessment years, as bogus and to add the same in respective assessment year." In spite of several opportunities given to the assessee as discussed above, the assessee failed to furnish details as called for. Since the assessee has not filed any details and/or explanation by establishing the identity proof of the sundry creditors, their creditworthiness and the genuineness of the transaction and produced relevant books of account from which it could have been verified, more particularly the party ledger accounts, the claim made on account of sundry creditors amounting to Rs. 7,72,400/- is treated as bogus and added to the total income of the assessee for the assessment year 2014-15. Addition: Rs. 7,72,400/-. 4. On verification of balance sheet, it is seen that during the year the assessee has shown to have introduced additional capital to the tune of Rs. 5,97,186/-. In this connection, the assessee was asked vide this office letter dated 11.02.2016 to file details explaining the source of addition of such fresh capital with documentary evidence. ....
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....ion (sale) in cash. Shree Shyam Products Page No. 09 to 10, MFP-30 01.06.2013 to 27.06.2013 Rs. 21,44,142/- including opening balance of Rs. 7,78,781/- Radhe Krishna Page No.11 of MFP-30 29.06.2013 to 04.07.2013 Rs. 2,80,213/- Shree Shyam Products (Bran account) Page No.22 & 23, MFP-30 01.04.2013 to 28.04.2013 Rs. 18,77,683/- including opening balance of Rs. 8,32,053/- Shree Shyam Products (Bran account) Page No.24 & 25, MFP-30 01.05.2013 to 31.05.2013 Rs. 15,78,781/- including opening balance of Rs. 15,859/-. Thus, on perusal of the ledger accounts it is seen that all the sales are made in cash and the sale of bran has not been disclosed in the regular books of account. In this connection, statements Sri Deepak Sharma, Manager of M/s. Maharaja Food was recorded on 27.11.2013 wherein he has admitted that the sales of the said rice bran have not been recorded and disclosed. The relevant portions of the statements are reproduced herein under: "Q. No.8: Please go through the impounded loose sheet bundle MFP-30 at page No.9, 10 regarding the ledger of Maharaja Food Products in the books of Shree Shyam Products, for perio....
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....s, vouchers and registers etc. in support of purchase of rice bran were also found. Sri Deepak Sharma also could not able to produce the same during the course of such proceedings and also during recording his statement on 27.11.2013. He also failed to identify the books/documents containing such unaccounted purchase of rice bran. Further, Sri Deepak Sharma also failed to produce any material evidence in support of his claim. Thus, it is proved beyond reasonable doubt that the undisclosed sales of rice bran was out of extra production made from milling in rice mill i.e. M/s. Maharaja Food Products". In view of the above findings, the assessee vide letter in the form of questionnaire No. DCIT(Central)/SBP/2015-16/569, dated 24.09.2015 was required to explain the undisclosed sales of rice bran with documentary evidence on 13.10.2015. On this given date, Sri Sudip Sawdia, advocate and the authorized representative appeared and represented the case on behalf of the assessee. In response to the said questionnaire, he filed acknowledgment copy of ITR-V submitted for AY. 2013-14, computation statement of total income, Form No. 26AS, copy of audit report along with audited profit ....
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....ound in the mill premises was taken by physical counting in the presence of the Manager Sri Deepak Sharma with the help of their staff members. On cross verification of said physical stock found with stock registers maintained, the following discrepancies were found. Items Stock as per books (Qtls.) Stock found on physical verification (Qtls.) Excess/shorta ge (Qtls.) Paddy 36,077 25,835 (-) 10,245 Rice 3,808.70 4,354 ( + ) 545.30 Broken rice 123.72 409 ( + ) 285.28 Bran 139.67 56.25 R83.42 In this connection, a statement of Sri Deepak Sharma, Manager & brother of Sri Sanjay Sharma, Proprietor of M/s. Maharaja Food Products, who looks after business activities was recorded during the course of survey operation. During such proceeding, he was asked to explain the reasons for shortage/excess of stock found. In his reply Sri Sharma stated that there should not be such difference of stock. He also stated that the stock inventory was taken on eye estimate but at the same time he also assured to explain the stock difference later on after verifying the records. However, he failed to furnish reconciliation statement of s....
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....idence on 13.10.2015. In this connection, it may be stated here that on this given date, Sri Sudip Sawdia, advocate and the authorized representative appeared and represented the case on behalf of the assessee. In response to the said questionnaire, he filed acknowledgment copy of ITR-V submitted for AY. 2013-14, computation statement of total income, Form No. 26AS, copy of audit report along with audited profit & loss account and balance sheet with relevant schedules and-premium paid certificate issued by the LIC of India etc. Apart from the above, the authorized representative of the assessee did not file any details/documents including the explanation called for on the issue as discussed above. Hence, the case was subsequently fixed for hearing on 23.10.2015, 13.11.2015, 27.11.2015, 11.01.2016, 28.01.2016 and lastly, on 19.02.2016. But all the time there was no compliance on the part of the assessee. The assessee has also not thought it proper and appropriate to file time petition except for the date of hearing fixed on 13.11.2015. Even though the assessee filed time petition for the proceeding dated 13.11.2015, he has not filed the same in time. The time petition filed....
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....annum i.e. Rs. 20,000/- per month, after all expenses which works out to Rs. 2,40,000/- and add the same in his total income. Addition: Rs. 2,40,000/-. For the reasons stated above, initiated penalty proceedings u/s. 271(l)(b) & u/s. 271(l)(c) of the Income tax Act, 1961. In view of the above discussion, the total income of the assessee is computed as under: Net profit as per profit & loss account Rs. 14,02,890/- Less: Income to be considered separately Rs. 1,896/- Rs. 14,00,994/- Add: Sundry creditors treated as bogus as discussed in the body of the assessment order vide Para No.3 Rs. 7,72,400/- Add: Income earned from undisclosed source and introduced as fresh capital as discussed in the order vide Para No.4 Rs. 5,97,186/- Add: Unpaid outstanding liabilities disallowed as discussed in the body of the order vide Para No.5. Rs. 1,37,001/- Add: Undisclosed sale of rice bran as, discussed in the body of assessment order vide Para No.6. Rs. 83,62,872/- Add: Shortage of stock of paddy & bran found during the course of survey operation as discussed in the body of the assessment order vide Para No.7. Rs. 1,28,72,....
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....dered to be deleted. The ground of appeal is allowed. 6. Ground No 2(h):- 6.1 In this ground the appellant has contested the addition made by the assessing » officer of Rs. 5,97,186/- on account of unexplained capital. The appellant has explained that Maharaja Food Products is a proprietary concern of the appellant and the cash introduced in this concern from his individual account. The relevant portion of the appellant's submission is as below: "55. As regards GROUND No.2(11) - Addition of Rs. 5,97,186 made holding income earned from undisclosed source and introduced as fresh capital, it is humbly submitted at the outset that there is no incriminating material found during the search as regards to this issue. Therefore, the learned Assessing Officer have no jurisdiction in making disallowance and thereby making addition, in view of various judicial authorities referred to above. 56. That it is further humbly submitted that the assessee Shri Sanjay Sharma is the Proprietor of two Proprietorship concerns -(I) M/s.Maharaja Food Products, Chkarkend having rice mill business and (2) Sanjay Sharma carrying on business of bus plying and tradi....
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....2-13. (v) Details of Unsecured loan confirmation account from the Asst. Year 2008-09 to 2014-15. (vi) Copy of the loan confirmation account of M/s. Bargarh Rice Miller Consortium Pvt. Ltd. (vii) Ledger copy of the sale of bran account confirming the bran sale by M/s. Bargarh Rice Miller Consortium Pvt. Ltd. & M/s. Balgopal Food Products during the Asst. Year 2013-14. (viii) (a) Registered copy of agreement to sale dtd.21.07.2010 between Shri Sanjay Sharma and Shri Shanti Swarup Mishra. (b) Copy of the registered land sale deed between Shri Shanti Swarup Mishra and Shri Puranmal Sharma, Bargarh. In view of the above, without examining the accounts produced before him, the learned AO is not at all justified in holding the impugned amount of Rs. 5,97,186 as undisclosed income introduced as capital. The copy of respective ledger accounts are placed at PB page Nos. 88 and 89, which were not examined by the learned AO though produced before him. It is respectfully submitted that on the face of books of accounts and financial statements duly audited, the action of the Assessing Officer in making the impugned addition holding it as undi....
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....ked MFP 30, where the assessee has been indicated to have sold rice bran to Shri Shyam Products and Radhe Krishna totalling Rs. 83,62,872, which in fact according to correct calculation is Rs. 46,75,479 thus - the total bran transaction as per show cause notice is Rs. 83,62,8727-, whereas total transaction as per table-I & II shown in the show cause notice comes at Rs. 86,69,9297- (42,54,1267- + 44,15,8037-). Further there is double addition of the same amount which also required to be deducted and so also the transaction relates to the earlier period, which is explained as under. Thus total transaction as per table-I & II - Rs. 86,69,929.00 Less : Deduction (i) Transaction of Radhe Krishan- Rs. 2,80,213.00 (ii) Transaction of Shyam Product- Rs. 11,05,685.00 (iii)Transaction of Shyam Product- Rs. 10,45,630.00 (iv) Transaction of Shyam Product- Rs. 15,62,922.00 Rs. 3 9,94,450.00 Rs. 46,7 5,47 9.00 Thus the total transaction as per show cause notice comes to Rs. 46,75,479, which the assessee claims to be not relating to the assessee. 24. That the assessee right from begi....
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....of principles of natural justice. It is therefore prayed before Your Honour to please issue summon to M/s.Shree Shyam Product and M/s.Radhe Krishan to establish he truth. The assessee has requested Your Honour vide a separate Petition dt. 10.11.2017 (by Speed Post) to issue summons to the said third party namely, M/s.Shyam Products and M/s.Rade Krishan and allow opportunity of confrontation to the assessee, for the ends of natural justice. 25. That in view of the above, without correlating the same by examining the third party and/or obtaining statements from them, the entries found in the accounts of third party have been utilised against the assessee and therefore the addition as made by the learned Assessing Officer on this count is unjustified and is liable to be deleted and it is prayed accordingly." 8.3 These submissions were forwarded to the assessing officer vide this office letter dated 19.01.2018 for submission of the remand report. The assessing officer has submitted remand report in which she has stated that document MFP-30 was impounded from the business premises of the appellant and therefore, the appellant can not deny that the transaction belong to....
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....rice bran to Sri Shyam Products. 3. The documents HMB-25/MFP-30 mention cheque payments as well as cash payments. In respect of cheque payments, it is stated in the assessment order that Maharaja Food Products has received cheque payments from both the parties i.e. M/s. Sri Shyam Products and M/s. Bargarh Rice Millers Consortium Private Ltd by the same cheques drawn on same bank. The relevant portion of the assessment order is reproduced below. "From the above charts, it is seen that the assessee Sri Sanjay Sharma, Prop. M/s. Maharaja Food Products has received payments from both the parties i.e. M/s. Shree Shyam Products and M/s. Bargarh Rice Millers Consortiums Pvt Ltd by same cheques 0$$^ J*jj of United Bank of India, Bargarh i.e. cheque Nos. are he same. Further, the date and the amount of the cheques are also the same. " It is not possible that a person will receive payment from two parties by a cheque bearing same number, date, amount and drawn on the same bank. 4. In the rejoinder filed by the appellant, he has stated that all the cheques have been issued by Bargarh Rice Miller Consoritium Pvt Ltd. A copy of cheques has also been filed by the appel....
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....but alleged ledger account of Maharaja Food Products in books of Shri Shyam Products. This ledger copy contains cheque payment as well as cash payments. According to the assessing officer, these are undisclosed receipts of the appellant from Shri Shyam Products. However, the appellant has vehemently denied any such receipt, either in cash or in cheque from Shri Shyam Products. Since, it is a running ledger, the best way to establish whether the ledger account is genuine or not, is to find out to who has made the cheque payment to the appellant. If the cheque payment is made by the Shri Shyam Products then by the principle of preponderance of probability, it will be established that cash payments are also made by Shri Shyam Products to the appellant. The appellant has produced evidence in the form of cheque that the payment is made by BMRC and not by Shri Shyam Preducts. The assessing officer has accepted the evidence and has agreed to the appellant on this issue. Therefore, there is no doubt that payment received by the appellant in cheque as appearing in the impounded material has come from BMRC and not from Shri Shyam Products. Therefore, it is my considered view that alleged led....
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....s per paddy joint custody and maintenance of stock register (See PB Page 108 ) Plus 8,100 qtls., as per paddy stock register (See PB Page 92). At the outset the assessee may kindly be permitted to refer to the inventory of stock of paddy, rice, broken rice and bran prepared by the search party (copy placed at PB Page No. 81 and 82) from which it can be seen that they have firstly mentioned the physical stock in bags on eye estimation, then converted into quintals by adopting unique contents in each bag and then compared with the stocks mentioned in the stock register (impounded). The assessee humbly submits that the entire process of stock inventory and working out the excess/shortage of stock arrived at by the search party is completely erroneous and also completely based on eye estimation and not by actual weighment of the stocks of paddy/rice/bran etc., when men power and weighing machines are available in the mill premises. It is further submitted that at the time of survey, when asked, it was explained that there should not be such difference of stock. It is because the stock inventory was taken on eye estimate. The same stand was also taken before the learned Assessi....
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.... under the OVAT Act' 2004 is enclosed herewith. That the milling of paddy and sale of rice are under the control and regulated by the Essential Supplies Act and the stock of paddy & rice in possession of the assessee on behalf of the OSCSC Ltd. are from time to time checked by the Food & Supply Department, Govt. of Orissa. They periodically and regularly check the registers and put their initials in support of having inspected the stock of paddy and rice and verified the physical stock with accounts. During the asst. year 2014-15 the Civil Supply Authority Officials inspected the assessee mill premises and verified physicals stock of paddy and rice on different occasion and times i.e. on 01.04.2013, 21.04.2013, 12.05.2013, 24.05.2013, 18.06.2013, 10.07.2013, 05.08.2013 & 16.08.2013 just five days before the date of survey conducted on 21.08.2013. No discrepancies either in paddy account or rice account they found and accepted. The physical stock of paddy and rice are tallied with the stock register. They put their signature in the stock register in support of having inspected the stock of paddy & rice and verified the physical stock with accounts on different date of i....
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....ling and receive milling charges and incidental charges such as handling (labour) charges and transportation charges etc. we receive milling charges @ Rs. 25/- per quintal. Thus, since we do not purchase paddy and sale rice, we are not maintaining purchase and sale registers. However, we maintain sale register for bran and broken rice and purchase register for materials purchase. There was a survey on 21.08.2013 & 22.08.2013 when the milling which in continuous milling from 16.08.2013 to 20.08.2013, the assessee was advise to stop the milling process, hence there is no milling from 21.08.2013 & 22.08.2013. Hence the rice, broken rice, bran received out of milling i.e. (from 16.08.2013 to 20.08.2013) were scatred in milling house, veranda and at different places. They could not be weight, packet properly in the bags and also the kunda mixed with the out turn of rice could not be segregated through chalana. Again raw paddy in loose scatred before chalana, clean paddy storage, paddy stored in eight numbers handi loaded for boiling, storage situated above handi, drier, parboiled paddy storage in mill premises. The stock of paddy as kept different storing places as mentioned ab....
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....OUNT ON 21.08.2013. AGENCY PADDY (in Qtls) RICE (in Qtls) MARKFED Nil Nil O.C.S.C.S. 36077 3808.70 TOTAL 36077 3808.70 As per Survey Report 25832 4354.00 Shortage/Excess (-) 10245 (+) 545.30 The shortage/excess in paddy & rice are due to eye estimation and further taking the each bag at a uniform quantity of 42 Kg. in paddy and 50 Kg. in rice respectively. This sample method of calculating is unscientific and unsustainable in the day to day business and also in the eye of law. There is no physical weighment though every kind of facilities like automatic kanta (weighing machine) are available in the mill premises itself. Even the labours for it are also available. The assessee feels sorry to say that he had made a prayer earlier to supply the calculation sheet how the quantity of paddy kept in each big godown are determined. There may be certain mistake in calculation, addition and subtraction or otherwise while taking the inventory of the stock of goods and in counting and in preparation while taking the physical stock of goods. The assessee also states when Deepak Sharma while recording the statement ....
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....ck inventory on sampling method. Further they have not taken into account the stock of goods such as, paddy, rice, broken rice & bran kept in different four big godowns, veranda, paddy chalana, raw paddy silo, above handi storage, in handi, in drier, parboiled silo in mill premises, scattered paddy in milling site etc. If the stocks in the plant itself which was in the process of milling and milling sites, would have been taken by the survey party, there would not have been any discrepancy. 30. Further the survey team, as can be seen from the inventory prepared by them, they have reported the stock in term of "bags " without physical counting of bags, rather on eye estimation, but subsequently converted the same into "quintals" by taking unique quantity per bag. The stock of paddy in bag are not stored at a uniform quantity, generally it is also a fact that bag/packets contains paddy either 40 Kg. or 50 Kg. And at times the bags contains 74Kgs or 75 Kgs. The actual quantity of paddy cannot be ascertained without actual weighment of the same. Thus, the working out of the stock > inventory is erroneous, because it was on the basis of eye estimation and not actually on weighment. Ther....
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.... submitted that the assessee undertakes only custom-milling for M/s. Orissa State Civil Supplies Corporation Ltd. (OSCSC Ltd.) besides he was also the agent of MARKFED, NAFED, NCMSL, PACS and FCI. For the purpose of custom milling the assessee has entered in to agreement with the Orissa State Civil Supplies Corporation Ltd (OSCSC Ltd. /Orissa State Co-operative Marketing Federation Ltd.(MARKFED) Orissa. In terms of such agreement the principal such as MARKFED, Orissa shall purchase paddy directly from the farmers and the assessee Custom miller will transport the same from the market yard on payment of charges within the limit prescribed and after milling, rice of specified quality as per the out-turn ratio fixed by them is delivered. It is necessary to slate here that the stock of paddy kept in the mill premises was under lock and key of the officials of the Principals as well as the assessee and milling of paddy takes place only after releasing of stock of paddy by the said officials for the purpose of milling. The officers of the Principlals give periodical certificate on the verification report - "It is certified that there is no mis-appropriation/diversion by the miller and pad....
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....ening balance in order to arrive at closing balance. The said sale of bran has been effected to a VAT registered dealer M/s. Bargarh Rice Miller Consotorium Ltd. vide Tax Invoice No. 1121, dt.21.08.2013, bran 90 qtls. for Rs. 94,500/- which is inclusive of VAT charged at Rs. 4,500/- Vehicle No. OR17C-7574 which has been duly reflected in VAT return (copy of bill is placed at PB Page No. 104). If all these above are taken into cohsideration, there is no shortage and/or negligence/tolerance shortage. In view of the above, the addition of Rs. 13,47,352 is not justified and liable for deletion." 9.3 In the remand report, the assessing officer has stated that stock was taken correctly the valuation was done correctly. 9.4 I have carefully examined the assessment order, written submissions of the appellant and remand report of the assessing officer. I find that the appellant is only a custom milling agent of agencies of Government of Orissa. The principals have right, interest and title to the stock. The godowns in which paddy and rice is kept are under lock and key of the principals. The appellant has filed copies of register of stock which are inspected by government ....
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....sis, which read as under :- i.) This is a Departmental appeal against the various reliefs allowed by the CIT(A)-2, Bhubaneswar vide appellate order dated 29.06.2018 u/s. 250 of the Income Tax Act. The assessee is running a rice mill under the name & style as M/s. Maharaja Food Products at Chakerkend. A search & seizure was carried out at the Maharaja Hotel group to which the assessee belongs, on 21.08.2013 by the Officers of the Department. ii.) The first and second grounds of appeal relate to the addition of Rs. 7,72,400/- made by the A.O. This issue has been discussed by the AO in para-11 on page 110 (internal marking). The final conclusion of the AO can be seen in the last paragraph on page 108 (internal marking). The CIT(A) has allowed the relief to the assessee and his findings are contained in para-5.2 on page-7 of the appellate order. The decision of the CIT(A) is totally erroneous and contradictory to the submissions made by the assessee during appellate proceedings for the following reasons: a) The CIT(A) has allowed relief to the assessee on the ground that the creditors in question were trade creditors and paddy was purchased from them in the c....
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....at the powers of the CIT (A) are co-terminus with that of the AO, empowering him to do all that, what the AO could or also should have done, for the purposes of assessment. A reference may be made to the decision of the Hon'ble Apex Court in the case of CIT vs. Kanpur Coal Syndicate (53 ITR 225) in which it was held that AAC has plenary powers in disposing off an appeal; that the scope of his power is co-terminus with that of the ITO, that he can do what the ITO can do and also direct him to do what he failed to do. The Hon'ble Bombay High Court in the case of CIT vs. Premkumar Arjundas Luthra (HUF) (69 taxmann.com 407) has held that the CIT(A) is required to apply his mind to all issues which arise from impugned order before him whether or not same had been raised by appellant before him and that he is obliged to dispose of the appeal on merits. In view of above facts, it is requested that the addition made by the A.O. may kindly be restored and finding of CIT(A) be reversed. iii.) The third and fourth grounds of appeal relate to the addition of Rs. 5,97,186/- made by the A.O. on account of unexplained capital. This issue has been discussed by th....
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....tated that the assessee can't deny the transactions of unaccounted sale of rice bran. The CIT(A) has allowed the relief to the assessee and his findings are contained in para-8.6 on page-16 of the appellate order. The decision of the CIT(A) is totally erroneous for the following reasons: a) These ledger accounts (MFP-30) were impounded from the premises of the assessee. The presumption about the authenticity/genuineness of such documents and the trueness of their contents as per section 292C has not been rebutted by the assessee. Mere denial by the assessee is not enough. b) These ledger accounts clearly mention name of buyers, dates of unaccounted sale, dates of cash receipts etc. Hence by no stretch of imagination, these can be called dumb documents or irrelevant. c) The suppressed sale of rice bran stands proved by the contents of impounded documents when it is read in conjunction with the statement of Shri Deepak Sharma, Manager of M/s. Maharaja Food Products and elder brother of the assessee, which was recorded on oath u/s. 131 of the Income Tax Act. He has clearly admitted that such sale of rice bran was not recorded in the regular books of acco....
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....refer to pages-4 & 5 of Annexure-III (enclosure of 19 pages) which contains the ledger account of M/s. Maharaja Foods Products in the books of Shree Shyam Products. In this ledger account, there is one cheque payment of Rs. 4,11,824/- by BRMC. But the CIT(A) has chosen to remain silent for other cash receipts of Rs. 14,50,000/- for the month of April, 2013. Kindly refer to pages-6 & 7 of Annexure-III (enclosure of 19 pages) which contains the ledger account of M/s. Maharaja Foods Products in the books of Shree Shyam Products. In this ledger account, there are all the cash receipts for the month of May, 2013. As there are no cheque payments, the unaccounted sale of rice bran to Shree Shyam Products stands proved. f) It is pertinent here that the assessee was a director in Bargarh Rice Mills Consortium (BRMC) till 2012 (kindly refer to question no.25 on page-55 of Annexure-II of paper-book). Therefore the collusive nature of such unaccounted transactions can't be denied by the assessee. In fact, if replies of the assessee on page 54 of Annexure-II of paper book (questions 22 & 23) are examined, then it would be clear there were large number of transactions between the as....
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....affidavit dated 14.01.2018 i.e. after a lapse of 5 years. e) In the case of Hotel Kiran (82 ITD 453) (Pune ITAT) and Hiralal Maganlal (96 ITD 113) (Mumbai ITAT), the Hon'ble Tribunals have held that where during the course of search, the assessee has made some admission, then he debars the authorized officers from making further investigation. Therefore, in their wisdom the Legislature has provided that such statement can be used as evidence and the assessment can be made on that basis. Reliance is also placed on the decision of Hon'ble Supreme Court in the case of Surjeet Singh Chhabra Vs. Union of India [1997] 1 SCC 508 "wherein it was held that the Revenue officials are not Police officers and the confession, though retracted, is an admission and would bind the petitioner. In view of above facts, it is requested that the addition made by the A.O. may kindly be restored and finding of CIT(A) be reversed. vi.) The twelfth ground of appeal relates to the addition of Rs. 2,40,000/- made by the A.O. This issue has been discussed by the AO in para-8 on page 103 (internal marking). The CIT(A) has allowed the relief to the assessee and his findings are....
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....er of the Assessing Officer should be restored. 8. On the other hand, ld. AR relied on the order of CIT(A) and filed paper book containing annexures-I to IV, which is placed on record. Ld. AR also filed his written submissions, which read as under:- 1. The appeal is filed by the Revenue against the order of the learned Commissioner of Income-tax (Appeals) deleting various additions made by the Assessing Officer for the Assessment Year 2014-15. The Respondent-assessee has filed the Cross Objection fully supporting the impugned order of the learned CIT(A).- 2. That at the outset it is humbly submitted that the Assessing Officer passed the impugned assessment order exparte which was vehemently challenged before the learned CIT(A) to be arbitrary, illegal and unjustified. An Affidavit in this regard containing 15 pages was filed before the learned CIT(A) (Copy attached as ANNEXURE-I) and it was contended before the learned CIT(A) that the Assessing Officer has framed the assessment order in haste and without giving proper opportunity of being heard to the assessee. Further disputing the various additions (made by the Assessing Officer) before the learned CIT(A), th....
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....n clearly given in the submissions filed before the Assessing Officer on Dt.21.03.2016 giving all details such as name of the creditors, amount credited etc. The assessee is having all the details of sundry creditors with ledger accounts, their name, address, Adhar number etc. The details are as under : SUNDRY CREDITORS : For the Asst. Year- 2014-15 Sl. No. Name of sundry debtors, sundry creditors, loan & advance taken, loans & advances given (each in separate table) Amount Nature of the debtor/ creditor and loans and advances If loans and advances bear interest, please furnish Relationship with the entity (Party/ concern) Complete present address of such entity with PIN code. Maximum amount outstanding for three years and as on date. At the beginning and at the end of the F.Y. under consideration Balance as on date. Amount of interest paid/ amount of interest received and the amount involved. 1 2 3 4 5 6 7 8 9 1 Banbas Sahu Nil 96000 Creditor Nil Creditor Bargarh No 2 Bhubaneswar Sahu Nil 92000 Creditor Nil Credi....
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....ey had spent in the above process of work subsequently to be paid by the assessee. Therefore, the word "sundry creditors" appearing in the accounts is nothing but a nomenclature as against liability to be paid to those representatives. Thus, the transactions have been effected during the course of business of the assessee. Further the transactions are not bogus. All of them are permanent residents of their respective locality and most of them assist the business in this way year after year. The copies of Adhar Card in respect of each person are placed at PB Page Nos. 59 to 65. The learned Assessing Officer never made any query about the above credits and instead without considering the reply of the assessee, but whimsically disallowed the claim of the assessee simply alleging that the assessee has no explanation. Further the Assessing Officer has never established that the amount shown as sundry creditors has been out of the income of the assessee. In view of the above, it is submitted that the impugned addition under this head being unjustified may kindly be deleted." Further during the hearing of the appeal proceedings, the assessee filed ledger copies, confirma....
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....m. In the remand proceeding, the Assessing Officer neither examined the claim of the assessee nor call for any details from the assessee but simply furnished the remand report stating therein that the assessee furnished only the ledger copies, but supporting bills and vouchers were not filed either at assessment stage or appeal stage. 3.3. Considering all above facts and after properly examining the various evidences and verifying books of accounts produced before him, the learned CIT(A) is perfectly justified in deleting the addition of Rs. 7,72,400 made on account of sundry creditors and as such, the grounds No.(i) and (ii) raised by the Revenue in their Grounds of appeal are liable to be dismissed by upholding the impugned order of the learned CIT(A) in this regard and it is prayed accordingly. 4. GROUND No. (iii) and (iv) as raised by the Revenue read as under: "(iii) That the Ld. CIT(Appeals) erred in law as well as fact in deleting the addition of Rs. 5,97,186 which was added by the A.O. as unexplained capital introduction from undisclosed sources. (iv) That the learned CIT(A) has failed to notice the fact that the assessee was unable to su....
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.... cash book and copy of respective ledger accounts and also demonstrated and established this fact. Therefore, the learned CIT(A) after considering the submissions made by the assessee, remand report of the Assessing Officer and the books of accounts produced before him, has perfectly justified in deleting the impugned addition. 4.3. That in their grounds of appeal, the Revenue has urged that the learned CIT(A) has failed to notice the fact that the assessee was unable to submit any details explaining source of addition of such fresh capital introduction with documentary evidence during assessment proceeding and so also in the remand proceeding. In this respect it is humbly submitted that neither anything was asked by the Assessing Officer in this regard in the assessment proceedings nor examined the books of accounts though produced before him during the course of assessment but he completed the assessment hastily on dt.29.03.2016 since the limitation for completion of assessment was going to be time barred by dt.31.03.2016. Further the remand report was submitted by the Assessing Officer without calling for the assessee to explain this issue. Therefore, the ground raised ....
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....se are undisclosed receipts of the appellant from Shri Shyam Products. However, the appellant has vehemently denied any such receipt, either in cash or in cheque from Shri Shyam Products. Since, it is running ledger, the best way to establish whether the ledger account is genuine or not, is to find out to who has made the cheque payment to the appellant. If the cheque payment is made by Shri Shyam Products then by the principle of preponderance of probability, it will be established that cash payments are also made by Shri Shyam Products to the appellant. The appellant has produced evidence in the form of cheque that the payment is made by BMRC and not by Shri Shyam Products. The assessing officer has accepted the evidence and has agreed to the appellant on this issue. Therefore, there is no doubt that payment received by the appellant in cheque as appearing in the impounded material has come from BMRC and not from Shri Shyam Products. Therefore, it is my considered view that alleged ledger account in MFP-30 of the appellant in books of Shri Shyam Products is neither reliable nor valid. Accordingly, the addition made by the assessing officer of Rs. 83,62,872 is ordered to be delete....
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.... to others. 25. That as can be seen from the seized papers, those loose papers impounded are the ledger copy of the assessee in the books of account of both the above named parties namely M/s.Shree Shyam Products and M/s.Radhe Krishna, who are third parties. Therefore, onus heavily lay on the Revenue to prove that the noting appearing in the seized loose papers of a third party actually relates to the transactions of the present assessee. This can only be proved by examining the said third party and that can be done only on issuance of notice u/s.131 of the Act to the said third party. It is, therefore, right from the beginning the assessee is requesting to issue summons to those parties and allow opportunity of confrontation to the assessee, but unfortunately the AO has neither conducted any enquiry from those parties nor issued summons to them in order to ascertain the truth. All these facts have clearly given in the reply to Sl.8 to the notice No. DCIT(Central)/SBP/2015-16/139 dt.10.02.2016 (PB Page No. 14) it was specifically requested to the Assessing Officer to summon Shree Shyam Product as well as Radhe Krishna to confirm the facts that they have purchased either ri....
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....se parties but alleged the assessee to have sold bran/husk to those parties basing on documents related to third parties, which is in complete violation of principle of natural justice. Therefore, the addition made on this count is liable to be deleted. 13. That the AO while submitting her remand report has not considered the submissions of the assessee. She did not bother to summon/examine those parties in order to ascertain the truth in this regard and submitted her remand report saying MFP-30 was impounded from the business premises of the assessee, which contains ledger copy of transaction of sale of rice bran to Sri Shyam Products and Radhe Krishna therefore, the assessee cannot deny that transaction does not belong to him. The facts remain that papers under MFP-30 are the ledger account of the assessee in the books of Shri Shyam Prducts and Radhe Krishna, which means those are the accounts of Shri Shyam Products and Radhe Krishna and not of the assessee and as such, the said parties are the best persons to explain the entries made in their books of accounts. The AO submitting remand report, as it appears, has given much stress on the fact that those documents were im....
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....sale register is placed at pages 15 & 16). 17. From the bran sale register it may kindly be seen that during the AY under consideration bran was sold only to M/s.Bargarh Rice Millers Consortium Pvt. Ltd and not to any other party, which is well verifiable from the Bran Sale Register maintained by the assessee which sales have been duly accounted for in the books of account of the assessee. Further, nothing has been unearthed during the course of search pointing out any excess receipt of bran over and above what the assessee had actually received from milling of Government Paddy and duly disclosed in the books of account of the assessee. 18. That the AO has made the impugned addition in respect of alleged sales of bran/husk to M/s.Shree Shyam Products/Radhe Krishan. The assessee has right from beginning denied to have any business relationship with M/s.Shree Shyam Products either by the assessee or by any of his family members, which can be seen from the statement of Sri Sanjay Sharma (assessee) recorded on the date of search i.e., Dt.22.08.2013 (copy of Relevant portion placed at Page 17) when he categorically stated as under: "Q.38. You/your family membe....
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....roducts (assessee) in the books of Shri Shyam Products, which contains both cheque payment as well as cash payment. The assessee right from beginning is denying of having any business relationship with M/s.Shyam Products. The payment by cheque shown in the said document MFP-30 as paid by M/s.Shyam Product is false as the said cheque was actually received from Bargarh Rice Miller Consortium Pvt. Ltd and not from M/s.Shree Shyam Products in support of which the assessee produced the copy of cheque, bank statement, certificate from the Bank. The AO has accepted the evidence and has agreed to the assessee on this issue in the remand report. Therefore, considering the facts and circumstances of the case and considering the submissions of the assessee and the supporting evidences/documents produced by the assessee before him, the learned CIT(A) is perfectly justified in holding that the alleged ledger account in MFP-30 of the assessee in books of Shri Shyam Products is neither reliable nor valid and thus deleting the impugned addition in this regard. It is prayed by the assessee that the said order of the learned CIT(A) on this issue may kindly be upheld and the grounds raised by the Rev....
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....missions which have been quoted in the appellate order, reads as under : "26. In these two grounds following two additions are disputed - (v) Addition of Rs. 1,28,72,786 on the alleged shortage of stock of paddy and bran, and (vi) Addition of Rs. 13,47,352 on the alleged excess of rice & broken rice 27. That the survey party reported excess/shortage of paddy, rice, broken rice and bran as under: Items Stock as per books (Qtls) Stock found on physical verification (Qtls) Excess/shortage (Qtls) Paddy 36,077* 25,935 (-) 10,245 Rice 3,808.70 4,354 (+) 545.30 Broken rice 123.72 409 (+) 285.28 Bran 139.67 56.25 (-) 83.42 *(The total of 27,977 qts. as per paddy joint custody and maintenance of stock register ( See PB Page 108 ) Plus 8,100 qtls., as per paddy stock register (See PB Page 92). At the outset the assessee may kindly be permitted to refer to the inventory of stock of paddy, rice, broken rice and bran prepared by the search party (copy placed at PB Page No. 81 and 82) from which it can be seen that they have firstly mentioned the physical stock in bags on eye estimat....
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.... the business of milling of paddy & sale of rice produce and by products broken rice, bran. In order to effectuate the business activities the assessee has installed a rice mill unit in the name & style of M/s. Maharaja Food Products, Po: Chakarkend, Dist :Bargarh. The first commercial production was commenced on 03.11.2004 i.e. during the asst. year 2005-06. That for the aforesaid activities the assessee is registered under the Odisha Value Added Tax Act' 2004/ Central Sales Tax Act' 1956 and Entry Tax Act' 1999 being a Reg. No. TIN-21711700794 /CST-21711700794(C)/ ET-21711700791(ET) having only, a registered office at the mill premises and other than it, there is no other office of the assessee. Copy of the Registration Certificate issued under the OVAT Act' 2004 is enclosed herewith. That the milling of paddy and sale of rice are under the control and regulated by the Essential Supplies Act and the stock of paddy & rice in possession of the assessee on behalf of the OSCSC Ltd. are from time to time checked by the Food & Supply Department, Govt. of Orissa. They periodically and regularly check the registers and put their initials in support of having inspected t....
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....rma in course of survey proceedings in the mill premises on 21.08.2013 & 22.08.2013. The survey party puts the question. Relevant question for present purposes are quoted as follows - 6Q. What are the books of account maintained by M/s. Maharaja Food Products ? A. We maintain stock register for paddy, rice, bran and broken rice. 7Q. Do you maintain Purchase and Sale registers ? A. We do not maintained Purchase and Sale register for paddy and rice, because we do not purchase paddy and sale rice. We receive paddy from Odisha State Civil Supply Corporation and MARKFED. In our Mill, We process paddy and produce rice and supply the same to Odisha State Civil Supply Corporation and MARKFED. We are only doing custom milling and receive milling charges and incidental charges such as handling (labour) charges and transportation charges etc. we receive milling charges @ Rs. 25/- per quintal. Thus, since we do not purchase paddy and sale rice, we are not maintaining purchase and sale registers. However, we maintain sale register for bran and broken rice and purchase register for materials purchase. There was a survey on 21.08.2013 & 22.08.....
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.... Date of Search Inventory of Stocks Found/Seized Restrained at the premises Sl. No. Description Quantity in Nos. of Wt. Total quantity in all 01. Rice 8708 bag (50 Kg. per bag) 4354 qtl. 02. Broken Rice 818 bag (50 Kg. per bag) 409 qtl. 03. Bran 125 bag (45 Kg. per bag) 56.25 qtl. Thus on the basis of the inventory of the stock, the following discrepancy of stock are found as follows - Items Stock as per books (Qtls) Stock found on physical verification (Qtls) Excess/ shortage (Qtls) Paddy 36077 25832 (-) 10245 Rice 3808.70 4354 (+) 545.30 Broken rice 123.72 409 (+) 285.28 Bran 139.67 56.25 (-) 83.42 PADDY & RICE AS PER BOOKS OF ACCOUNT ON 21.08.2013. AGENCY PADDY (in Qtls) RICE (in Qtls) MARKFED Nil Nil O.C.S.C.S. 36077 3808.70 TOTAL 36077 3808.70 As per Survey Report 25832 4354.00 Shortage/Excess (-) 10245 (+) 545.30 The shortage/excess in paddy & rice are due to eye estimation and further taking the each bag at a uniform quantity of 42 Kg. in paddy and 50 Kg. in rice respectively. This samp....
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....00/- which is inclusive of VAT charged at Rs. 4,500/- Vehicle No. OR17C-7574 which has been duly reflected in VAT return. There will be negligence/tolerance shortage if it is considered. (Copy of the bill Enclosed and marked as Annexure - 'H' The searching party during the survey did not find any valuable assets or any incriminating material or papers against the assessee. Basing on a discrepancy found in the stock of paddy and rice during the survey valued it." 29. That the stock inventory prepared by the survey party was actually based on eye estimation and not by way of actual weighment, when the weighment facility is available with the assessee. No working sheet for stock inventory was prepared by the survey team. They have prepared the stock inventory on sampling method. Further they have not taken into account the stock of goods such as, paddy, rice, broken rice & bran kept in different four big godowns, veranda, paddy chalana, raw paddy silo, above handi storage, in handi, in drier, parboiled silo in mill premises, scattered paddy in milling site etc. If the stocks in the plant itself which was in the process of milling and milling sites, would have been ta....
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.... the excess/shortage claimed to have been found by the survey party is far from truth and it was so reported by them only on eye estimation and by non- taking the stocks available in the milling process and further on wrong method of converting bags into quintals. Further, the Civil Supply Officials have not noticed any omission or commission as there are no comments by those authorities in the registers maintained by the assessee. They have not commented anything adversely regarding maintenance of stock register. Registers are impounded U/s.133A of the Act and laying with the department since then. That the said register i.e. paddy & rice stock register has been impounded under identification No. MFP-40 Pages-1 to 20 and 21 to 29. 31. That it is further submitted that the assessee undertakes only custom-milling for M/s. Orissa State Civil Supplies Corporation Ltd.(OSCSC Ltd.) besides he was also the agent of MARKFED, NAFED, NCMSL, PACS and FCI. For the purpose of custom milling the assessee has entered in to agreement with the Orissa State Civil Supplies Corporation Ltd (OSCSC Ltd. /Orissa State Co-operative Marketing Federation Ltd.(MARKFED) Orissa. In terms of such agre....
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....ot purchase paddy and sale rice, we are not maintaining purchase and sale registers. However, we maintain sale register for bran and broken rice and purchase register for materials purchase." The learned AO did not consider the above submissions and basing on erroneous stock inventory has worked out the excess/shortage in stock and made the impugned addition, which is not proper. 32. In case of broken rice day to day yield of broken rice from 16.08.2013 to 20.08.2013 out of milling in a raw stage was laying on the floor of the milling house. It was mixed with husk, kunda, sand & other materials which were yet to be cleaned. In case of bran the sale to the tune of 90 qtls affected on the day of survey i.e. 21.08.213 was not deducted from the opening balance in order to arrive at closing balance. The said sale of bran has been effected to a VAT registered dealer M/s. Bargarh Rice Miller Consotorium Ltd. vide Tax Invoice No. 1121, dt.21.08.2013, bran 90 qtls. for Rs. 94,500/- which is inclusive of VAT charged at Rs. 4,500/- Vehicle No. OR17C-7574 which has been duly reflected in VAT return (copy of bill is placed at PB Page No. 104). If all these above are taken into....
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....re should not be such difference of stock. On the facts and circumstances of the case as stated in the foregoing paragraphs alongwith various documents/evidences produced before the lower authorities the undisputed facts emerges that whatever the stocks of paddy and rice are found at mill premises belong to the principal OSCSC/MARKFED and not of the assessee. That the ownership of such stocks kept in the mill premises are with the Principal and not the assessee it being only a Custom Milling Agent. Further for this purpose the assessee maintains stock register of paddy & rice, which have been checked by Food & Supply Department, Government of Orissa from time to time with the actual physical stock in the mill premises, as can be well verified from the copy of stock register. One such checking was conducted by the Civil Supply Authority Officials on 21.08.2013 just five days before the date of survey, when no discrepancies, whatsoever, either in paddy account or rice account were noticed or reported by them. The physical stock of paddy and rice are tallied with the stock register. On these facts it was submitted by the assessee before the learned CIT(A) that the excess/shortage clai....
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....eparately anywhere in return of income and therefore, submission of the appellant cannot be accepted. Further the assessee contended before the learned CIT(A) that no incriminating material regarding bus plying activities of the assessee were found during the course of search & survey. Considering the facts and circumstances of the case and also considering the submissions of the assessee, the remand report of the Assessing Officer and the books of accounts produced before him, the learned CIT(A) has deleted the addition of Rs. 2,40,000 made on account of bus plying business observing in paragraph 10.3 in his order, which reads as under: "10.3. I have carefully considered the assessment order, remand report and submissions of the appellant. It is important to note here that this is an assessment after the search on group members. No incriminating material regarding bus plying activities of the appellant was found. In the absence of any evidence, it will be wrong to presume that the appellant has not disclosed income from bus plying activities. Indeed, during the course of appeal proceedings and remand proceedings, the appellant has given details such as gross income, depre....
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....assessee and remand report received from the AO without discussing in details on the issues involved. Aggrieved thereby the Revenue is in appeal before us and the assessee has filed cross objection supporting to the order of CIT(A). Now, we shall decide the ground Nos.i & ii. In these grounds the Revenue has challenged against the deletion of Rs. 7,72,400/- on account of sundry creditors. We noted from the paper book filed by the assessee that the sundry creditors were authorized representative of the assessee and acting on behalf of the assessee for procuring paddy. We further noted from page No.10 of the paper book para 20 of the affidavit filed by the assessee in which they categorically undertakes that he is doing only custom-milling for M/s Orissa State Civil Supplies Corporation Ltd.(OSCSC Ltd.) besides working also as agent of MARKFED, NAFED, NCMSL, PACS and FCI. For the sake of brevity, we would like to reproduce para 23 & 24 placed in the paper book as Annexure-I, which reads as under :- 23. That in order to carry out the custom milling, and because it is a seasonal business, in order to work effectively and speedily to reach the target fixed by the Principals, I ....
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.... discharged his duty properly then in this circumstances the ld. CIT(A) should have exercised his powers provided under the provisions of Income Tax Act. The CIT(A) has co-terminus power as per the sections provided under the Income Tax Act. He should have called the creditors for their truthness and examined the issue. From the above observations, we are of the view that the assessee has provided details of the creditors, which should have been examined by both the authorities below but they did not do so for proving the genuineness of the creditors. As per our considered opinion, the assessee discharged his liability as cast upon him and now the duty shifted on the revenue authorities for the verification of the genuineness of the creditors, which are lack in this case. In the second round of proceedings before the Assessing Officer, he could have exercised his powers for presence of the creditors and verification of the genuineness of the transactions done with the creditors but did not do so. Accordingly, we dismiss the ground Nos.i&ii raised by the Revenue and decide the issue in favour of the assessee. 11. Ground Nos.iii & iv relate to deletion of addition of Rs. 5,97,186/....
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...., ld. DR submitted before us that in ledger account of M/s Maharajan Foods Products in the books of Shree Shyam Products, there are all the cash receipts for the month of April, May & June 2013. As there are no cheque payments, the unaccounted sale of rice bran to Shree Shyam Products has not proved. The said documents were found from the premises of the assessee which is a copy of ledger account maintain by Shree Shyam Products and Radhey Krishna in the name of Maharaja Food Products, which has been marked as MFP-30. It was the duty of the assessee to rebut the same but he could do so. After long time he filed affidavit which cannot be accepted. He also referred to Section 292C of the Income Tax Act 1961. Therefore, the AO has rightly made the addition on account of suppression of sales, which has not been recorded in the books of accounts of the assessee. It is also clear from the order of the CIT(A) that this is a modus operandi adopted by the assessee because there is an opening balance showing in the ledger account seized during the course of search proceedings. On the other hand, ld. AR relied on the order of CIT(A) and submitted that the CIT(A) is perfectly justified in hold....
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....assessee should have retracted immediately before the concerned authorities. The affidavits filed by Sanjay Sharma placed in the paper book at pages 51 & 52, is also not acceptable. Merely filing of the affidavit without any corroborating evidences in the contents of the affidavits ,are not acceptable. Our this view is supported by the decision of Hon'ble Supreme Court in the case of M/s Mehta Parikh and Co. Vs. CIT 1956 AIR 554 (SC). During the assessment proceedings, the AO has provided ample opportunity to the assessee for explaining the matter but the assessee did not do so. It was not the duty of the Assessing Officer to call Shri Shyam Products & Radhey Krishna for cross examination as alleged by the assessee that the natural justice has been followed by the assessee because the documents were found in the premises of the assessee in which it clearly shows that there is a transaction has been done with aforesaid two parties. The said documents found from the assessee's premises, he should have explained why these documents are lying with him. Therefore, as per Section 292C, the copy of ledger account in respect of transactions with M/s Shree Shyam Products and Radhey Krisihna....
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....Deepak Sharma has categorically stated in his recorded statement that the stock inventory has been taken on eye estimate and there should not be such difference of stock. On the facts and circumstances of the case as stated in the foregoing paragraphs alongwith various documents/evidences produced before the lower authorities the undisputed facts emerges that whatever the stocks of paddy and rice are found at mill premises belong to the principal OSCSC/MARKFED and not of the assessee. That the ownership of such stocks kept in the mill premises are with the Principal and not the assessee it being only a Custom Milling Agent. Further for this purpose the assessee maintains stock register of paddy & rice, which have been checked by Food & Supply Department, Government of Orissa from time to time with the actual physical stock in the mill premises, as can be well verified from the copy of stock register. One such checking was conducted by the Civil Supply Authority Officials on 21.08.2013 just five days before the date of survey, when no discrepancies, whatsoever, either in paddy account or rice account were noticed or reported by them. The physical stock of paddy and rice are tallied ....