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TMI Blog2013 (10) TMI 75X X X X Extracts X X X X X X X X Extracts X X X X ..... law have been claimed in ITA No.615 of 2008 and three identical questions have been claimed in ITA Nos. 616 and 617 of 2008. Learned counsel for the assessee submitted that in so far as questions (i) and (iv) in ITA No. 615 of 2008 and question (i) each in ITA Nos. 616 and 617 of 2008 are not being pressed. Thus, in all the three appeals, identical substantial questions of law have been pressed by the learned counsel for the appellant. For brevity, the facts are being extracted from ITA No. 615 of 2008. 2. This appeal has been preferred by the assessee under Section 260A of the Income Tax Act, 1961 (in short "the Act") against the ITA No. 615 of 2008 order dated 7.12.2007 passed by the Income Tax Appellate Tribunal, Amritsar Bench, Amrits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant documents were produced at the time of hearing and no ITA No. 615 of 2008 discrepancy was found therein. The questionnaire was also duly replied by the assessee. The Assessing Officer vide order dated 22.12.2005 (Annexure A-1) disallowed an expenditure of Rs. 3,50,000/- and treated it as income of the assessee holding that the administrative expenses, labour and wages expenses and work expenses were paid in cash and the only evidence was in the form of muster rolls/attendance sheets, therefore, the element of inflated expenditure under the head could not be ruled out. Feeling aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) [hereinafter referred to as "the CIT(A)"]. The CIT(A) vide order dated 7.2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls Ltd. v. Commissioner of Income Tax, West Bengal (1954) 26 ITR 775. 6. Controverting the aforesaid submissions, learned counsel for the revenue supported the order passed by the Tribunal. It was argued that the assessee had claimed expenses on account of labour and wages and other work which were made in cash and only evidence maintained was in the shape of muster roll and attendance sheets in which there were no addresses of the parties to whom payments had been made. It was not possible to verify the claim of the assessee in such circumstances. According to the learned counsel, the addition sustained by the Tribunal was, thus, correct. 7. After giving our thoughtful consideration to the respective submissions of learned counsel for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supra), it was noted as under:- "No doubt the irregularities in the books of account were admittedly found by the assessing authority and 11 transactions of sale as entered in the books of account created suspicion but the total amount of those sales is only Rs. 653.14. In making best judgment assessment certain amount of speculation is bound to creep in but neither the assessing authority nor the appellate authority has disclosed in the impugned orders as to how it worked out the figure at Rs. 51,523.88 as increase. The best judgment assessment, whatever be the extent of speculative element in it, has at the same time to be based on some reasonable objective data. It is not kno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence in a court of law, but the Income-tax Officer is not entitled to make a pure guess and make an assessment without reference to any evidence or any material at all. There must be something more than bare suspicion to support the assessment under Section 23(3). The rule of law on this subject has been fairly and rightly stated by the Lahore High Court in the case of Seth Gurmukh Singh v. Commissioner of Income-Tax, Punjab (1994) (12 ITR 393)." 12. It is in the light of these principles that we have to consider whether the Assessing Officer, the CIT(A) and the Tribunal in the instant case followed the correct principles. It would be relevant to refer to certain observations made by the Assessing Officer in the assessment order while ..... X X X X Extracts X X X X X X X X Extracts X X X X
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