TaxTMI 
TaxTMI 
2005 (6) TMI 204
X X X X Extracts X X X X
X X X X Extracts X X X X
....ccount of alleged unaccounted sales in milk of Rs. 60,75,992 2. Making addition on account of alleged shortage on account of ghee, shreekhand, butter, milk of Rs. 5,73,562 3. Disallowing Rs. 89,828 out of presentation of articles. 4. Disallowing entertainment expenses of Rs. 1,36,651 under s. 37(2) of the Act. 5. Disallowing depreciation on godown of Rs. 80,000". 2. The learned Authorised Representative has not pressed ground Nos. 3 to 5 as necessary relief has already been granted by the Department, therefore, these ground Nos. 3 to 5 are dismissed as not pressed. 3. The ground Nos. 1 and 2 are based on identical set of facts, therefore, same are decided together. The AO made the additions with fol....
X X X X Extracts X X X X
X X X X Extracts X X X X
....explanation. Taking average rate of Rs. 102.25 per kg. (after excluding sales-tax and commission), the sale value of the aforesaid quantity of ghee comes to Rs. 5,70,371. In the absence of any valid explanation, the same is added back to the total income of the assessee." 3.1 The AO has also made addition of Rs. 1,252 on account of shreekhand. In this way total addition made is Rs. 5,73,562 with following observations: "During the course of assessment proceeding, the assessee furnished chart indicating monthwise details of opening stock of milk, receipt of milk, receipt from other dairies and conversion of milk from other items namely, powder, sales return, etc. Initially the assessee has furnished these details in the piecemeal....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... aforesaid amount is added back as income." 4. The learned Authorised Representative submitted that the assessee was maintaining regular books of account following the accepted accounting principle. The quantity details were also maintained. The assessee has filed all the required details. The Authorised Representative, manager (accounts), manager (production) and assistants of units also attended the hearing before AO. He further submitted that books of account are subject to audit under s. 44AB. The learned Authorised Representative submitted that the AO has made arbitrary addition without pointing out any defects in the books of account maintained by the assessee. The learned Authorised Representative submitted that the assessee has f....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... furnished under s. 44AB of the Act to the AO while filing the return of income for the relevant years. Hence, the above statement contains the details/documents/materials which are on the records of the AO. 5. The learned Departmental Representative, on the other hand, relied upon the orders of lower authorities and submitted that the assessee is not maintaining any record in respect of internal consumption. The AO has already allowed possible wastage to the extent of 1,00,000 litres of milk, which CIT(A) has also found reasonable. 6. We have heard the learned representatives of the parties and perused the record. The admitted facts of the case are that the AO had neither invoked s. 145 nor had pointed out any specific defect in the ....