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TMI Blog2015 (4) TMI 140X X X X Extracts X X X X X X X X Extracts X X X X ..... , Tarn Taran Road, Amritsar in May, 2004 by three bills for total amount of ₹ 1,82,250/-. Only one payment of ₹ 37,500/- was received during the financial year 2004-05 and the balance of ₹ 1,44,750/- was irrecoverable and claimed as bad debts. On the basis of various documentary evidence filed by the assessee as well as on the basis of judgment of Hon'ble Supreme Court of India) in the case of T.R.F. Ltd. Vs. Commissioner of Income Tax (2010 (2) TMI 211 - SUPREME COURT , the learned first appellate authority deleted the addition in dispute. Secondly, it is also not disputed by the Assessing Officer that the recovery of amount in dispute is still unrecovered. Therefore, the addition in dispute amounting to ₹ 1,44,750/- has rightly been deleted by learned first appellate authority and we uphold the impugned order on the deletion of addition of Rs. ₹ 1,44,750/-. - Decided against revenue. - ITA No.72 (Asr)/2012, CO No.13(Asr)/2012 - - - Dated:- 29-4-2014 - H S Sidhu And B P Jain, JJ. For the Appellant : Shri Tarsem Lal, DR For the Respondent : Shri Salil Kapoor, Adv. ORDER :- PER : Bench 1. The Revenue has filed the present a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out adjustment. However, this reply of the appellant did not merit consideration with the A.O. It is opined by the A.O. that no adjustment of accounts are required to be made at the time of audit of books of accounts. Further, the closing stock found on physical verification during survey was less than the stock shown in the trading account prepared and filed during the course of assessment proceedings which also goes to show that the appellant has been indulging in making purchases and sales outside the books of accounts. Considering the appellant s explanation nothing but an after-thought and since the true profits from the appellant s books of account cannot be worked out/adduced as such the same were rejected. By referring the provisions of Section 292C, the contents of the books of account other documents found during survey u/s 133A to be true and also by adopting the figures of input tax credit and output tax credit as per trial balance drawn on the date of survey on 24.08.06, the Assessing Officer observed that investment in purchases of ₹ 24,67,208/- remained undisclosed, besides earning profit of ₹ 2,65,708/- on sales of Trs. 53,89,265/- made outside the boo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wards nondisclosure of interest accrued @ 12% p.a. on two advance of ₹ 2,50,000/- each, the appellant has filed this appeal. 3. Aggrieved with the order dated 09.10.2009 passed by the Assessing Officer under Section 143(3) of the Act in which the Assessing Officer made the addition in dispute, the assessee filed an appeal before the learned first appellate authority, who vide impugned order dated 29.12.2011, partly allowed the appeal of the assessee. Now, being aggrieved with the order of learned first appellate authority, the Revenue filed the present appeal challenging the additions deleted by the learned first appellate authority. The assessee has also filed his cross objection. 4. At the time of hearing learned DR relied upon the order passed by the Assessing Officer and stated that the learned first appellate authority has wrongly deleted the addition of ₹ 27,32,916/- made by the Assessing Officer on account of investment in purchases from undisclosed sources and profit on sales made outside the books of accounts. He further stated that the second addition amounting to ₹ 1,44,750/- has also wrongly been deleted by the learned first appellate authority i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heet as on 31.03.2006 filed at the time of assessment proceedings. The above amount was outstanding in the Input Tax Credit A/c after the adjustment of Input Tax Credit Output Tax Credit at the time of finalization audit of books of account of the financial year 2005-06. The Assessing Officer has ignored the outstanding balance of ₹ 2,88,171.59/- as on 01.04.2006 in the Input Tax Credit A/c while estimating the purchases of ₹ 75,91,125/- for the period of 01.04.2006 to 24.08.2006 by applying VAT @ 4% on the balance of I.T.C. of ₹ 3,03,645/- as per Trial Balance made at the time of survey. In fact, the I.T.C. during the above period was only ₹ 15,474/- from the purchases of ₹ 3,86,838/- during the above period which was duly accounted for in the books. Similarly, the Assessing Officer has also ignored the outstanding balance of ₹ 2,17,070.16/- as on 01.04.2006 in the Output Tax Credit A/c while estimating the sales of ₹ 53,89,625/- for the period of 01.04.2006 to 24.08.2006 by applying VAT @ 4% on the balance of O.T.C. of ₹ 2,15,585.16/- as per Trial Balance made at the time of survey. In fact, the O.T.C. during the above period wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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