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TMI Blog2012 (9) TMI 694X X X X Extracts X X X X X X X X Extracts X X X X ..... ramed different opinion on similar facts considered by the A.O. in assessment order. Therefore, the CIT order u/s 263 is a change of opinion - set aside the order of CIT - in favour of assessee. - ITA No. 1368/Ahd/2011 - - - Dated:- 31-7-2012 - Shri D.K.Tyagi and Shri T.R. Meena, JJ. By Appellant Shri P.F. Faij, A.R. By Respondent Shri S.K. Gupta, CIT D.R. ORDER PER : T.R.Meena, Accountant Member- This is an appeal at the behest of the Assessee which has emanated from the order of CIT Ahmedabad-IV, Ahmedabad, order dated 10.03.2011 for assessment year 2006-07. The effective grounds of appeal are as under:- 1. The Ld. CIT Ahmedabad-IV, Ahmedabad has grievously erred in law and on facts in assuming juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f liability of Rs.1,03,24,530/- under head unpaid freight as on 31.03.2006. Out of this total liability, the appellant had paid Rs.77,01,958/- during the Financial Year 2005-06, had admitted in his statement recorded during the course of survey that the amount of Rs.77,01,958/- unaccounted income in the year i.e. F.Y. 05-06. 3. The CIT, Ahmadabad-IV, Ahmadabad, issued notice to the assessee u/s 263 of the IT Act on 21.02.2011 on the admission of disclosure of Rs.77,01,958/- for meeting out outstanding liability from unaccounted income and the A.O. had accepted unaccounted income as business income instead of computing income u/s 69C of the IT Act. the order of the A.O. passed u/s 143(3) dated 31.12.2008 was found erroneous and prejudicial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosed by the assessee and the decision of territorial jurisdictional High Court. It is an admitted fact that expenses paid of Rs.77,01,958/- was, not found recorded in its books of account. Section 69C of the IT Act says "where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof or the explanation if any offered by him is not, in the opinion of the AO satisfactory, the amount covered by such expenditure or part thereof as the ease may be, may be deemed to be the income of the assessee for such financial year." Hon'ble Gujarat High Court has dealt in detail the deeming provisions in their decision in the case of Fakir Mohmed Haji Hasan Vs.CIT (24 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Bench, ITAT C Bench for A.Y. 06-07 in assessee s case, copy of the CIT(A) order for A.Y. 06-07, copy of various notices issued by the A.O. and reply given by the assessee and copy of audit report. Ld. Counsel has drawn our attention on the query letter dated 02.12.2008 issued by the A.O. in which the disclosure of Rs.77 lacs during the course of survey, has been considered by the A.O. The A.O. query is reproduced as under: Please refer .On going through the computation of business and profession it is revealed that you have shown a loss of 58,76,290/- and surprisingly this is arrived after including disclosure under survey towards excess liabilities created and found during the course of survey proceedings conducted in your busi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted/ disclosed /identified in the course of survey i.e. 77.01,958/-. But surprisingly the assessee has filed his return of income for the A.Y. 2006-07 showing income of Rs. 69,27,336/- ( Less than the disclosure made during the survey/additional income offered) 2.2 As per the profit and loss account the assessee has shown gross receipt of Rs.11,68,24,064/- against which shown gross profit of Rs.2,94,53,387/- and added Rs.86,80,423/- as indirect income which included 77,01,958/- and finally he has shown indirect expenses of 4,40,10,100/-. Thus a net loss of 58,76,289/- even after considering 77,01,958/-. He further claimed that these additions were challenged before the ld. CIT(A) and CIT(A) had allowed the appeal partly in favour of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ange of opinion. Thus, the order passed by the CIT u/s 263 is liable to be set aside. 5. From the side of the Revenue, ld. CIT D.R. relied on the order of the CIT. 6. We have perused the orders of the authorities below and heard the arguments from both the sides. The survey disclosure has been considered by the A.O. He has considered unpaid freight and liability and no addition was made on account of outstanding liability from unaccounted income u/s 69C of the IT Act. The CIT has passed the order u/s 263 on the basis of liability of Rs.1,03,24,530/- has been shown as unpaid freight as on 31.03.2006 and liability paid Rs.77,01,958/- during the F.Y. 05-06, which has been considered by the A.O. The ld. CIT has framed different opinion on s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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