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TMI Blog2017 (8) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... ces of the case and in law, the learned CIT(Appeals) has erred in deleting the addition of Rs. 54.54 lacs claimed as payable was added to the income." 2. The brief facts of the case are that the assessee filed his return of income on 03.09.2008 declaring an income of Rs. 7,54,430/-. The case was selected for scrutiny and statutory notices were issued. The total turnover for the year under consideration was Rs. 14,53,75,462/-. During the course of scrutiny proceedings, the Assessing Officer asked for the details through questionnaire and for production of books of accounts. In this regard, the assessee submitted that a major fire occurred at the office cum godown at 172, Sector 15, part-I, Gurgaon on 12.06.2010 and all the records and stock were destroyed there. The Assessing Officer gave many opportunities for filing requisite details as per questionnaire issued, but the assessee did not comply with the notices. The ld. Assessing Officer also called for the details of the godown and offices. He submitted the details of offices and godowns as per letter dated 01.11.2010 showing the names and addresses and use of the premises. The Assessing Officer noted that the name and address o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue expense. The total expenditure was incurred towards repair and maintenance of Rs. 5,07,202/-, out of which Rs. 4,07,202/- were paid through the banking channel and rest amount through cash. Substantial amount was paid to M/s. D.K. construction is labour cost. The AO did not accept the explanation of assessee and treated it as capital expenditure and disallowed the sum of Rs. 5,07,202/-. 5. The Assessing Officer issued notice u/s. 133(6) to the creditors M/s. Irish Computer Ltd. and M/s. E sys Information Tech. Ltd., which were received back un-served. This fact was confronted to the assessee. The assessee did not file any information. Even confirmations from the parties were not filed. Therefore, the AO added the whole credit balance of ledger account stood at Rs. 31.03.2008 of Rs. 7,01,190/- and Rs. 47,53,544/- respectively totaling to Rs. 54,54,734/-, as un-confirmed credit balances. 6. Against the above additions, the assessee appealed before the first appellate authority. The assessee submitted additional evidence before the first appellate authority and remand reports were called from the Assessing Officer and after being satisfied with the submissions of the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the AO as required by section 68 of the Act. Mere filing of ledger account does not satisfy the conditions laid down u/s. 68 of the Act. The assessee has submitted confirmation from Rakesh Gupta in the remand proceedings, in which the PAN shown is also wrong. 9. In respect of ground No. 5, the ld. DR has not pressed because he submitted that the major part of the amount has been accepted by the Assessing Officer. 10. On the other hand, the ld. AR relied on the order of the ld. CIT(A). In respect of ground No. 1, he submitted that the ld. Assessing Officer has wrongly calculated the GP rate for the assessment year 2006-07. The details of profit and loss account were provided in the remand proceedings. The assessee did not submit correct G.P. rate. He had included all sundry balances write off of Rs. 2,67,692/- and Misc. income of Rs. 62,450/- and discount received of Rs. 23,737/- for calculation of gross profit of the business. These two items are not part of the regular trading activities. He submitted that it has to be excluded. Therefore, correct profit for F.Y. 2005-06 is Rs. 59093/- which given profit rate of 1.51% instead of 9.13%. Accordingly, the AO was not justified fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same could be produced with sales and purchase bills. The appellant had also filed an application under Rule 46A which was send to AO. In the remand report, the AO repeated the contents of the assessment order. In the rejoinder, the appellant stated that it had produced the books of accounts and the sales and purchase vouchers before the AO in the remand proceedings but he preferred not to comment on the same. The appellant submitted that the G.P. rate chart filed before the AO was not correct and was contrary to facts and the audited accounts. It was averred that during the assessment proceedings, the G.P. rate for the F.Y. 2005-06 was wrongly mentioned as 9.13 % though as per the audited accounts, the same was 1.51%. He also explained the reason for the calculation error. In the remand report, the ld. AO did not comment on this issue but stated that the audit report date as submitted by the AR is different from the audit report date mentioned in the e-filed return. On this pretext, he did not commented on the error in respect of G.P. rate. The rejoinder of the ld. AR was that there were two dates in the audit report one the for the statutory report and the other for the Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d resulting into a relief of Rs. 4,07,202/- to the appellant. Accordingly, the ground No. 2 is partly allowed." We do not find any material on record to discard the above findings of the ld. CIT(A). Accordingly, grounds Nos. 2 & 3 of appeal are dismissed. 13. In respect of ground No. 4, we find that the scrutiny proceedings were initiated on 29.09.2009 and fire accident occurred on 12.06.2010, but the report has been obtained from the Fire Department on 29.12.2010. During this period, the assessee submitted many written submissions before the Assessing Officer. The AO had also asked many times for filing of books of accounts, but the assessee did not tell about the fire accident and the destruction of books of accounts nor produced any books of account. It was only when the Assessing Officer finally asked the assessee on 20.12.2010 to produce the pending details as required by various notices and to produce the books of account, then the assessee informed the AO about the fire accident occurred in the office cum godown on 12.06.2010 and destruction of records there. We do not find any substance in the contention of the assessee that he raised unsecured loan from Rakesh Gupta onl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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