9911796707
TMI Blog2012 (10) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.2,87,450/- in A.Y. 2004-05. 3. Before the CIT(A) it was submitted that the AO considered the disallowance of claim out of context without appreciating that the claim of loss was supported from audited accounts. The varying claim of loss in different months was directly related to quality of milk which was procured from various agencies on day-to-day basis. The AO has failed to appreciate that the handling loss was directly related to quality of milk. As per quality of milk the loss in some of the months was substantially lower than the standard norms and in some of the months the loss was higher. However, on annual basis, the claim of loss was in conformity with standard norms. The assessee was maintaining complete quantitative record of raw material and finished products and the activity of the assessee was also subject to excise control and in the absence of any deficiency or irregularity in the production record or books of accounts, the AO was not competent to draw adverse inference out of context and in a distorted manner. The AO had not pointed out that books of account were not reliable or same were not in conformity with the provisions of sec. 145 and as such there was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as deleted by the learned CIT(A) but made the disallowance on the ground that the appeal of the Revenue was pending before ITAT. The learned CIT(A) further noted that ITAT for Assessment Year 1993-94 and other years has decided the issue in favour of assessee vide order dated 3.03.2006. The learned CIT(A) following the decision of ITAT deleted the addition in all the three years. 8. Before us the learned Sr. DR supported the order of the AO. However, the learned AR of the assessee relied on the decision of ITAT in assessee's own case. 9. We have heard both the parties and gone through the material available on record. ITAT Delhi Bench `H' in ITA Nos. 64 to 69/Del/2003 & 4164/Del/2004 for Assessment Years 1993-94 to 1995-96 & 1997-98 to 1999-2000 & 2001-02 dated 3rd March, 2006 has decided the issue in favour of the assessee. The order of the ITAT confirming the finding of the learned CIT(A) in deleting the addition on account of inflation of price of the milk purchased is reproduced as under:- "6.4 On consideration of the submissions of the learned D.R. and the findings of the CIT(A), we are of the view that no interference is called for in the matter. During the course of sear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t any evidence to show that these commission agents were employees of the assessee. The CIT(A) was satisfied with the documents on record that the seized documents have been properly explained to prove that there is no inflation in the purchase price of the milk. These facts on record before the CIT(A) clearly suggest that the Assessing Officer merely on the basis of presumptions and assumptions of certain fact came to the findings that there is a inflation in the purchase price of the milk, which is clearly unjustified and unwarranted. The Assessing Officer did not have any basis whatsoever to support this finding with regard to the inflation of the purchase price of the milk. The Assessing Officer in his own way without supporting through any material or evidence on record made the addition against the assessee. On such consideration of the above facts and circumstances, we are of the view that the Assessing Officer without any basis made the addition against the assessee. The assessee properly explained the issue and seized material before the CIT(A) and clearly proved that the seized material was not incriminating in nature and as such the CIT(A) was justified in deleting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, deleted the addition by observing as under:- "4.5 I have considered the claim of the appellant in the light of evidences placed on record. The appellant is engaged in the business of manufacturing and sale of ghee and milk powder etc. The sale is organized through agents appointed all over India and as a part of business understanding, actual expenditure on account of outward freight, loading and unloading expenses are reimbursed to the agents. The Assessing Officer has not disputed the business expediency of the claim or the fact that the claim was necessary for the purpose of business. The appellant has submitted a copy of account and debit note in support of the claim. 4.6 I have gone through the debit note and copy of account placed on record. The debit note is for Rs.6,79,030/-, but the Assessing Officer has made the disallowance only to the extent of Rs.5,70,156/-. The debit note was in respect of reimbursement of the claim in respect of freight and loading and unloading charges and also relating to reimbursement of draft making charges to the extent of Rs.67,030/-. The Assessing Officer has allowe3d the claim of Rs.67,030/- which is on the basis of the very same debit n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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