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TMI Blog2017 (7) TMI 1334X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 3,60,00,000/-. - HELD THAT:- AR has rightly pointed out by the ld.A.R that there is no evidence to suggest that this investment is based only on unsubstantiated statement made by its partner Shri S.P.Loganathan, Managing Partner of the assessee firm during the course of survey on 06.11.2013. As held by the Supreme Court in the case of S.Khader Khan sons [ 2013 (6) TMI 305 - SC ORDER] , statement under section 133A are not conclusive piece of evidence by itself and it cannot be relied upon for the prupose of assessment . Being so, we do not find any infirmity in the order of the CIT(Appeals) for deleting the addition made by the AO. Hence, this issue raised by the Revenue is rejected. Disallowance of milk cans and crates - nature of expenses - assessee had claimed as revenue expense disallowed, but AO holding them to be capital expense - CIT(A) observed that no enduring benefit is conferred warranting to treat expenditure on milk cans as capital in nature - HELD THAT:- The decision of the Ld.CIT(A) is based on the Order of Tribunal in the case of M/s.Tirumala Milk Products P Ltd. [ 2011 (2) TMI 1572 - ITAT VISAKHAPATNAM] . Being the expenditure towards plastic cane a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case the learned CIT(A) erred in deleting the addition made on account of treating the expenses incurred on crates and cans as capital expense without appreciating the fact that Income tax Rules prescribes the rate of depreciation at 50% for these articles, implying that these are capital assets. 5. On the facts and in the circumstances of the case the learned CIT(A) erred in deleting the addition of ₹ 5,00,000I- made on account of disallowance out of firewood expense ignoring the fact that assessee had agreed for the addition due to lack of proper documents/evidences. 6. The Hon ble ITAT is requested to cancel the order of the learned CIT(A) and uphold the order of the Assessing officer on the above points. 2.1 In Cross Objection, the assessee has raised the following grounds. 1. The order passed by the Learned Commissioner of income tax (Appeals) is very much appreciable in as much as in holding that the addition made by the assessing officer of ₹ 5,06,56,197/- u/s.68 is against the legality of the decision of Madras High court in the case of CIT Vs. Khadar than and son and affirmed by the Supreme court. The appellant has n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... smissed. First we take up Revenue s Appeal: 3. The facts of the case are that survey was carried out in the premises of assessee on 06.11.2013. During the course of Survey it was noticed that the figure of Sundry Creditors - Milk Suppliers as on 31/3/13 was mentioned as ₹ 12,21,81,032/- in the data maintained in the hard disc of the computer. However, in the same disc, the opening balances as on 01/04/13 was taken as ₹ 5,67,09,835/- i.e. the balance of Sundry Creditors was taken less by ₹ 6,54,71,197. In the statement recorded on 24/1/14 under section 131(1A), the Partner of the Firm has admitted this fact. In reply to question no. 32 of the statement dated 06/11/13, it was admitted by the partners that the Firm has boosted the figure of creditors to adjust the Balance Sheet. It was further stated that to his knowledge and belief the sundry creditors to the extent of ₹ 2,00,00,000/- may be boosted. 4. The first issue in Revenue s appeal is with regard to deletion of addition in respect of non-genuine creditors as not proved. 4.1 For the year under consideration, during the course of survey proceedings, assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cost of milk for the relevant assessment year. Further, the Assessing Officer made estimation of inflated purchase on the reason that the assessee has not furnished the confirmation letters from the creditors. The assessee pleaded before the Assessing Officer that there are large number of milk vendors who were form villages and they exactly not maintained any books of account to show that what exact amount was outstanding to them for the supply of milk. The assessee has categorically stated that it is maintaining collection centres and payments are made to the farmers from there. There is no third party evidence towards purchase cost of milk legally. Payments were made on the basis of own vouchers which are maintained by the assessee. Though the Assessing Officer estimated the inflation of purchase, he was not able to corelate those inflation of purchases during the assessment year under consideration. Thus, the estimated inflation of purchases is based on the subsequent years figures. In our opinion, the information gathered subsequent to the assessment year under consideration cannot be basis for estimation of inflation of purchases for the earlier assessment year. De horse, wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n its ground No2. 1 2 is partly allowed for statistical purposes. 6. The second issue in Revenue s appeal is with regard to deletion of addition made on account of unexplained investment in Chilling Plants. 6.1 The facts of the issue are that at the time of survey in reply to question no 33 of the statement recorded on 06/11/2013 Shri. S. P. Loganathan, Managing Partner of the assessee Firm, had stated that upto 31/3/13 investment in the newly under construction chilling plant units at Karur and Namakkal was around ₹ 3,60,00,000/-. During the course of survey he had declared additional income of ₹ 1,17,66,347/- on account of unaccounted investment in the chilling plants. This declaration was however not considered while filing the revised return. Despite being given opportunity during the course of assessment no explanation was filed as to why the said declaration has been retracted. Therefore, the AO added an amount of ₹ 1,17,66,347/- to the total income on the basis of the information given in the statement. Aggrieved by the order of ld. Assessing Officer, the assessee carried the appeal before the Ld.CIT(A). On appeal, the Ld.CIT(A) delete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the order of ld. Assessing Officer, the assessee carried the appeal before the Ld.CIT(A). On appeal, the Ld.CIT(A) observed that no enduring benefit is conferred warranting to treat expenditure on milk cans as capital in nature, following the decision of Tribunal in ACIT Vs. M/s.Tirumala Milk Products P Ltd., Narasaropet in ITA No.242/Vizag./2009 for assessment year 2005-06 and deleted the addition made by the ld. Assessing Officer. Against the order of Ld.CIT(A), now the Revenue is in appeal before us. 9. We have heard both the parties and perused the material on record. The decision of the Ld.CIT(A) is based on the Order of Tribunal in the case of M/s.Tirumala Milk Products P Ltd., (supra). Being the expenditure towards plastic cane and crate, which is not an enduring nature, 100% depreciation to be granted as revenue expenditure. Hence, this issue in Revenue s appeal is dismissed. 10. The last issue in Revenue s appeal is with regard to deletion of disallowance of firewood purchase expenses. 10.1 The facts of the issue are that during verification it was noticed by the AO that assessee had incurred expense for purchase of firewood in cash as w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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