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TMI Blog2014 (5) TMI 1102X X X X Extracts X X X X X X X X Extracts X X X X ..... imated basis. He made addition on account of difference found between the credit entry in the bank account and sale proceeds shown by the assessee at 17,31,629/-. The AO has not brought any material on record that the assessee had made purchases outside the books of accounts. The sales included the cost of purchase plus expenses and net profit. Therefore, the whole sale proceeds cannot be added as income of the assessee. As suggested by the ld.counsel for the assessee that 5% on net profit of total credit entries, i.e. 49,32,992/- be taken as income of the assessee which comes to 2,46,649/-. The appellant had already disclosed income at 1,30,757/- and returned income at 95,114/-. After reducing the amount of returned income, the net additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of purchases. 3. On the facts and in circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax (Appeals) has erred in confirming the action of the Assessing Officer in disallowing ₹ 43,152/- out of expenses. 4. On the facts and in circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax(Appeals) has erred in confirming the action of the Assessing Officer in making addition of ₹ 17,31,629/- on account of difference in bank account & sales. 5. It is therefore prayed that the above addition/disallowances made by Assessing Officer and confirmed by Commissioner of Incometax( Appeals) may please be deleted. 6. Appellant craves leave to add, alter or del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of books of accounts, but on the basis of computer print-out submitted by the ld.counsel for the assessee about the expenses, the AO disallowed ₹ 43,152/- on account of non-verifiable. (iii) Addition on account of difference in bank deposits and sales It was found by the AO thatin current bank Account No.0094- A42706-050 with Indus Ind Bank Ltd., Bardoli Branch the total deposits were ₹ 49,32,992/-, whereas the assessee has shown sales to the tune of ₹ 32,01,363/-, therefore, the assessee was asked to reconcile the deposits into bank account. The appellant had not submitted any detail except a certificate from Mahuva Pradesh Sahakari Khand Udhyog Mandali Ltd. in the name of Rahul Kumar Narpatsinh Rathod stating that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the action of the A.O. in disallowing 25% of purchases and 25% of expenses other than salary and bank interest. The addeiton amounting to ₹ 7,k51,807/- and ₹ 43,152/- are confirmed." (Regarding Ground No.4 of this appeal): "4. Ground No.3 is against the A.O. making an addition of ₹ 17,31,629/- on account of difference in credits in bank account and sales. During the course of assessment proceedings, it was observed by the A.O. that the total deposits in the bank account of the appellant during the year under consideration was ₹ 49,32,992/-, whereas toal sales shown by the appellant was only ₹ 32,01,363/-. The appellant was asked to show cause as to why said difference amounting to ₹ 17,31,629/- not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opportunities. No details of any agriculture income has been provided with the Appeal Memo. No exlanation as regards receipt from Mahuva radish Sahakari Khand Udhyog Mandli has been submitted. In any case, this is insufficient to justify the total difference. The nature of credit entries in the bank therefore remained to be explained as to their nature and source. Therefore, the action of the AO in considering the difference in credits in bank and sales as unexplained cash credits is upheld. This ground of the appellant fails." 4. Now, the assessee is in appeal before us. 4.1. The ld.counsel for the assessee submitted that the assessee is in the business of confectionary and provisions items during the year under consideration. The total ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppression of investment in acquiring the goods which have been found subject of undisclosed sales. He further relied upon the decision of Hon'ble ITAT Ahmedabad (camp at Surat) in the case of M/s.Om Carting vs. ITO in ITA No.3375/Ahd/2007 for AY 204-05, wherein it was held that estimation cannot be irrational or arbitrary. He further relied upon the decision of ITAT "B" Bench Ahmedabad in the case of Kesharbhai Ghamarbhai Chaudhary vs. ITO reported at (2012) 23 taxmann.com 273 (Ahmedabad - Trib.) for estimation of transport business. 4.2. At the outset, ld.Sr.DR supported the order of the ld.CIT(A). 5. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below as well ..... X X X X Extracts X X X X X X X X Extracts X X X X
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