2012 (6) TMI 892 - AT - Income Tax

Summary

Issues involved: Appeal against order of Ld. CIT(A) IV, Surat for assessment year 2006-07 regarding addition of Gross profit on alleged unaccounted production of yarn and unrecorded investment in stock.

Gross profit addition: The appeal was based on the tribunal order in the assessee's own case for the assessment year 2005-06. The A.O. made an addition of &8377; 11,92,336 for unaccounted turnover based on electricity consumption. Another addition of &8377; 7,76,260 was made for alleged unrecorded investment in stock. The tribunal noted that in the previous year, a similar addition was made and later deleted by Ld. CIT(A) due to lack of evidence. The tribunal upheld the deletion, stating that no adverse material supported the allegation of unaccounted production, and therefore, both additions were unjustified and deleted.

Conclusion: The tribunal allowed the appeal, stating that the additions made by the A.O. and confirmed by Ld. CIT(A) were not justified, and hence, both additions were deleted.