TaxTMI 
TaxTMI 
2023 (7) TMI 564
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....in-after referred to as "the Act") relevant to the Assessment Year 2010-11. 2. The Revenue has raised following grounds of appeal: 1. On the facts and in the circumstances of the case and in law, learned Commissioner (Appeals) erred in ignoring the facts that additions were made on the basis of inquiry report of a committee appointed by the Government of India. 2. On the facts and in the circumstances of the case and in law, learned Commissioner (Appeals) erred in ignoring the facts that in export of iron ore there is large scale under invoicing by some of the companies. 3. On the facts and in the circumstances of the case and in law, learned Commissioner (Appeals) erred in the facts that the AO has made additi....
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.... The above finding is very clear that the impugned addition (was also made on the basis of the same M B Shah Commission's report) is merely on the basis of the recommendation of the shah commission report, without applying mind by the AO Rather, the Shah Commission report itself suggests that the matter is subject to further verification and investigation from the Income tax department. Enforcement Directorate and other government agencies Even a survey carried out at the premises of the appellant yielded nothing about such practice of under invoicing. 7.6 It is also pertinent to observe that the assessee is trader and not miner. It has purchased goods from the open market and exported. The goods were sold at arm's length. ....
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.... be accepted He has to demonstrate that the assessee has received money through some other channel, and these are unaccounted sales. The Assessing Officer in that case is required to point out the defects in the accounts of the assessee and required to seek explanation of the assessee qua those defects. If the assessee failed to explain the defects than on the basis of the book result, income cannot be determined, and Assessing Officer would compute the income according to his estimation keeping in view the guiding factor for estimating such income. However, the AO has not rejected the book result for determining the suppressed sales: During the course of assessment and reassessment proceedings, the AO was unable to lay hand in any....
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.... authorities below as favourable to them. 8. We have heard the rival contentions of both the parties and perused the materials available on record. At the threshold, we note that the Hon'ble Gujarat High Court in the case of DCIT vs. Raw Mining and Industries Pvt. Ltd. reported in 119 taxmann.com 454 has decided the issue in favour of the assessee by observing as under: Therefore, we are of the view that report which has been termed by the Commission itself as tentative report could be setting the investigation machinery in motion. But it cannot be treated equivalent to a decree which is required to be executed as it is, more so, in the light of finding recorded by the Hon'ble Supreme Court and the stand taken by the respect....