9911796707
TMI Blog1994 (10) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... ief allowed at Rs. 1 lakh. Explaining the circumstances which led to the addition, it was stated by Shri K. Sampath, the learned counsel for the assessee, that survey under s. 133A of the Act was conducted on the business premises of the assessee on11th March, 1987. The stock was valued at Rs. 8,94,359 on the basis of tag price attached to the sarees in which the assessee carried on its business. After accounting for the gross profit rate declared by the assessee, the value of the stock was arrived at Rs. 5,41,880. The assessee's explanation as contained in the statement recorded at the relevant time indicated that tag price is double the cost of each saree, was not accepted. The Assessing Officer rejected the explanation and brought the di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintained in the manner that verification could not be made, specifically to the effect whether a particular saree was sold at a price as indicated in the tag or not. On the other hand, there were only 10 cash memos produced where the discount was stated to have been allowed. The addition made is only on the basis of tag price put by the assessee itself, and it cannot be said that the addition was made on surmises and conjectures. As evident from the assessment order there were incriminating documents found at the time of survey. In the circumstances, even the relief allowed at Rs. 1 lakh was not justified. 4. We have carefully considered the rival submissions. Admittedly all the entries in Uchant Bahi, loose papers and day book were fou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the high rate of profit could have been earned. In any case this was not so shown. In the circumstances, the only basis to fall back upon is either the assessee's own history or the comparable cases available in the market. As stated above, the assessee's own history supports it and there was no comparable case cited. At this juncture it would also be relevant to mention that having made an addition in this year, no adjustment for the same was made in the succeeding assessment year which would have led to substantial fall in the gross profit rate. On the other hand, the G.P. rate declared has been accepted. In the circumstances, we are of the considered view that even the addition confirmed is not warranted and cannot be sustained. Hence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n cheques or by demand drafts. No mitigating circumstances were shown as held by their Lordships of Allahabad High Court in the case of Ideal Tannery vs. CIT 1978 CTR (All) 111 : (1979) 117 ITR 34 (All), which would have justified the payments in cash. On the other hand, their Lordships of the Hon'ble Supreme Court have clearly held in the case of Attar Singh Gurumukh Singh vs. ITO (1991) 97 CTR (SC) 251 : (1991) 191 ITR 667 (SC) that even the genuine transactions are hit by s. 40A(3) of the Act. Considering that the payments for other purchases have been made through demand drafts and cheques to the same parties, the relief allowed by the CIT(A) was not justified. Shri Sampath on the other hand, supporting order of the learned CIT(A), subm ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
