9911796707
TMI Blog2011 (8) TMI 1118X X X X Extracts X X X X X X X X Extracts X X X X ..... ss, the AO reproduced his earlier order. The loss of 3.4% is borne out by audited accounts, which is lower than the average loss of about 4%. - ITA No. 3206(Del)/2011 - - - Dated:- 23-8-2011 - SHRI C.L. SETHI AND SHRI K.G. BANSAL For the Appellant: Shri H.L. Dihana, CIT, DR For the Respondent: Shri H.P. Aggarwal Shri Rajat Jain, C.As ORDER PER K.G. BANSAL : AM The facts of the case are that the original assessment was completed u/s 143(3) of the Income-tax Act, 1961, at total income of ₹ 133,68,40,385/-. This order traveled up to the Tribunal and in order ITA No. 471(Del)/2009 dated 22.04.2009, the matter regarding quantification of closing stock of natural gas was restored to the file of the AO for re-adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entioned that instead of showing gas in the pipe lines as a part of the inventory, the assessee has shown this stock as reconciliation difference. The assessee was requested to provide the details of length of the pipe lines and the weight of natural gas stored therein. This has not been done. Therefore, it has been held that it is not feasible to estimate the weight and value of the gas in the pipe lines, which should be included in the value of closing stock. In view thereof, the reconciliation difference, quantified at ₹ 6,56,14,607/-, has been added to the total income. 1.2 In the proceedings before the first appellate authority, the assessee furnished quantitative details of reconciliation differences in financial years 2001 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , it is argued that since the assessee failed to provide any information in the matter, the AO was justified in disallowing the reconciliation loss. The ld. CIT(Appeals) made observations about expert opinion, but the same has not been obtained and the relief has been given on the basis of observation of the Tribunal that the loss of 4% was reasonable and the loss in this year is lower than this percentage. However, he did not carry the matter further to obtain appropriate expert view from the officials of GAIL or ONGC Ltd. with a view to settle the issue once and for all. Therefore, since the assessee failed to furnish the details as per the order of the Tribunal, namely, whether the percentage of loss at about 3.46% of purchases had to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order for assessment year 2002-03 dated 25.07.2008, a clear finding was given that loss of about 4% of purchases is reasonable subject to verification. Instead of verifying the percentage of loss, the AO reproduced his earlier order. The loss of 3.4% is borne out by audited accounts, which is lower than the average loss of about 4%. Therefore, there seems to be no reasonable cause to make the disallowance of reconciliation loss by stating that the details of stock lying in pipe lines were not furnished in qualitative or quantitative terms. What had to be verified was whether the loss was in the vicinity of 4%, which has been held to be reasonable by the Tribunal. In these circumstances, we do not find any error in the order of the ld ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
