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TMI Blog2014 (4) TMI 711X X X X Extracts X X X X X X X X Extracts X X X X ..... s right in law and on facts in deleting the addition of Rs. 18,44,422/-made on account of unaccounted sales? (B) Whether the Appellate Tribunal is right in law and on facts in deleting the addition of Rs. 14,40,866/-made on account of under valuation of closing stock of finished goods? (C) Whether the Appellate Tribunal is right in law and on facts in deleting the addition of Rs. 5,55,270/-made on account of job charges? (D) Whether the Appellate Tribunal is right in law and on facts in deleting the addition of Rs. 1,50,000/- made on account of salary expenses? (E) Whether the Appellate Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contested by the assessee. The Assessing Officer, however, made further additions by relying upon the same books of account which had been rejected by him. The Tribunal was of the view that the Assessing Officer, once having rejected the books of account, could not have made further additions by relying upon the same books and that it would have been better, if the Assessing Officer had estimated a reasonable profit of the assessee considering the history and nature of the business. 5. As regards proposed question [A], which pertains to addition of Rs. 18,44,422/- in relation to wastage, the Tribunal, upon appreciation of the evidence on record, found that the assessee had claimed wastage in the preceding assessment year, that is, 2006-07 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oting that the assessee had not maintained item-wise inventory record which could be obtained from computerized books of account, he confirmed the additions. On behalf of the assessee reference was made to the details of bifurcation of closing stock in the paper book to show that the details of closing stock was maintained item-wise and there was no bar against maintaining manual quantitative details. The Tribunal was of the view that merely because the assessee did not maintain certain details on the computer was no ground for rejecting the explanation given by the assessee. 7. As regards proposed question [C] relating to disallowance of Rs.5,55,270/- on account of job charges paid to M/s Seema Creation, during the course of verification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the fact that the Assessing Officer had rejected the books of account, and as such was of the view that the some reasonable addition was required to be made by enhancing the profit of the assessee. The Tribunal found that the profit ratio of the assessee was better as compared to the earlier years and found it reasonable to make a lump sum addition of Rs. 2 lakh to protect the interest of the revenue. The Tribunal, therefore, set aside the additions in relation to the above four grounds of appeal and made a lump sum addition of Rs. 2 lakh. 10. Insofar as proposed question [E] which pertains to addition of Rs. 11 lakh on account of unsecured loans under section 68 of the Act and disallowance of interest expenses of Rs. 79,249/-, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of the loan taken from Mr. Kishanlal Sharma, who also had filed return of income and shown the deposit given to the assessee in his balance sheet which were shown to the Revenue Department and the assessee had deducted the TDS on the interest amount. In light of the fact that the assessee had been able to prove the identity of the creditors, genuineness of the transaction in the matter and creditworthiness of the creditor, the Tribunal found no reason for making the addition treating the same as unexplained cash credit and accordingly, set aside the said addition. 11. From the facts noted hereinabove, it is apparent that the Tribunal has based its conclusion upon the findings of fact recorded by it upon appreciation of the evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X
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