2009 (7) TMI 64

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....nt year 1997-98, proposing to raise the following questions of law: 1. "Whether on the facts and in the circumstances of the case, the ITAT was justified in deleting the addition of Rs.1,21,943/- made by the AO on account of suppression of yield of various products and by products of paddy milled, ignoring the fact that the assessee had failed to maintain record on this account and that the books of accounts had been rejected.?" 2. "Whether on the facts and in the circumstances of the case, the ITAT was justified in deleting the addition of Rs.3,94,075/- made by the AO on account of low yield of rice and other by products from paddy milled belonging to Government agencies ignoring the fact that the assessee had not maintained any stoc....

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....s were upheld by the CIT(A). However, the Tribunal set aside the order of the CIT(A) and remitted the matter back to the file of CIT(A). On second round, CIT(A) reiterated its earlier order. On further appeal, the Tribunal upheld the claim of the assessee. The reasons given by the Tribunal are that there was no material to show suppressed sales or inflated purchase and the inference drawn was without any justification. The assessee was not given liberty to cross-examine the bank officials who claimed to have verified the stock. The observations of the Tribunal are as under: "It is unbelievable that all the eight parties mentioned by the Assessing Officer were having the same percentage of yields i.e.  The yields taken into considera....