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TMI Blog2013 (9) TMI 809X X X X Extracts X X X X X X X X Extracts X X X X ..... of account - A.O made addition on the basis of loose paper which has been incorporated in the books of account and no defect otherwise has been found that those loose paper entries were recorded incorrectly - No addition is warranted – Decided against the Revenue. Difference of Rs.5,05,769/- as unexplained - Error made by Valuation Officer – Held that:- Apart from the technical objections, the CIT (A) found that the difference in C.P.W.D. and P.W.D. rates were well explained which is upto 10% value. It has also been recorded by the CIT (A) that some of the items of expenditure towards building construction have already been made on account of loose papers of which addition of Rs.40,85,115/- has been deleted, that to the extent there is e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal, Agra Bench, Agra dated 22.2.2013 in ITA No. 219/Agr/2011 in respect of assessment year 2005-06. 3. The appeal has been preferred by the department on following substantial questions of law:- 1. Whether the ITAT erred in law in giving relief to the Assessee on basis of doctrine of "res-judicata", which is not applicable in tax proceeding. 2. Whether the ITAT has erred in law in deleting the addition of Rs.31,05,967/- on account of alleged income and unaccounted expenses and investment, ignoring the fact that assessee society was not maintaining books of account in regular course of business and for the same reason it was not entitled for exemption u/s 10 (23C) of the Act, 1961. 3. Whether the ITAT has erred in law in deleting t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e A.O himself admitted before the CIT (A) that all the entries in the loose papers were found duly incorporated in the books of account. In this regard, we are of the considered view that the books of account subsequently prepared on the basis of the loose papers or material found at the time of survey is acceptable unless there is material showing that the books of account subsequently maintained was not proper or not in accordance with approved method of accounting. In the case under consideration no such contrary material was found that the books of account subsequently maintained were not in accordance with principle of accountancy. When the A.O made addition on the basis of loose paper which has been incorporated in the books of accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT (A) that some of the items of expenditure towards building construction have already been made on account of loose papers of which addition of Rs.40,85,115/- has been deleted, meaning thereby, that to the extent there is explanation from the assessee. After considering all the aspects of the matter, the CIT (A) deleted the addition of Rs.11,83,249/-. We, therefore, find that the CIT (A) has rightly deleted the addition of Rs.11,83,249/-. Order of the CIT (A) is confirmed on the issue. 12. We have heard the ld. representatives of the parties and records perused. It is admitted fact that the books of account prepared subsequent to survey was found in order. There is no provision under the Act that if the books of account are not found at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he CIT (A) has correctly appreciated the facts of the case and rightly deleted the addition of Rs.40,85,115/-. 7. On the question of valuation of the building under construction, the CIT (A) considered all the points of objections raised by the assessee and found that these objections were never considered by the AO. It was also found that the difference in C.P.W.D. and P.W.D. rates were explained and which is upto 10% value. The deletion of Rs.11,83,249/- by the CIT (A) was confirmed by the ITAT. 8. On the last question as to whether the exemption under Section 10 (23C) of the Act could be withdrawn, the ITAT observed that such exemption does not depend upon books of account but it depends upon relevant provisions of the Act, and relie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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