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TMI Blog2022 (8) TMI 1369X X X X Extracts X X X X X X X X Extracts X X X X ..... g grounds of appeal: "1. On the facts and circumstances of the case as well as on the subject, the learned CIT(A) has erred in confirming part action of assessing Officer in making addition of Rs. 12,94,933/- being profit @ 5% of alleged unaccounted job receipts. 2. It is therefore prayed that addition made by the assessing officer and confirmed by CIT(A) may please be deleted. 3. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal." 2. Brief facts of the case are that a search action was carried out under Section 132 of the Income Tax Act, 1961 (in short, the Act) on 19/02/2015. In the group cases of Sumeet Industries Limited, Surat. The assessee is a part of Sumeet Industries. During the course of search action, certain incriminating documents related with the assessee was also found. Consequent upon search action, notice under Section 153A dated 30/12/2015 was issued to the assessee for filing return of income. In response to notice dated 30/12/2015, the assessee filed its return of income on 16/06/2016 declaring income of Rs. 36,06,660/-. The Assessing Officer after serving notice under Section 143(2) and 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asis of such discrepancies, the Assessing Officer was of the view that there are two different set of data related to job works maintained in the computer and data maintained in Purchi software is not accounted in the books of account. The Assessing officer disallowed 20% of receipt of unaccounted job work by treating as 20% (20% of 2,58,98,667) as profit of such unaccounted job work. The Assessing Officer worked out the addition at Rs. 51,79,733/- in the assessment order passed under Section 143(3) r.w.s. 153A dated 16/10/2017. 4. Aggrieved by the additions, the assessee filed appeal before the ld. CIT(A). Before the ld. CIT(A), the assessee filed detailed written submissions. The submissions of assessee are recorded in para 5 of order of ld. CIT(A). In the submission, the assessee in sum and substance, submitted that the assessee is engaged in the business of job work of dyeing and printing of textile goods. The customers supplied grey fabrics to be processed. The design development department of assessee designs the same as per customer's requirements and then the print is finalized. When the grey fabrics enters into the premises, number of taka (90 to 110 meters of grey/finish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Section 133A of the Act at the business premises of assessee, from the back up of computer, inventoried as Annexure-A4, deleted files were retrieved which contained purchi data. The assessee explained that the above modus operandi explains the entire job work details undertaken by the assessee during the year under consideration. For comparison of data of books of account with purchi data, the assessee submitted that there are numerous reprocess, process and multiple process which are undertaken on single material. The data contained in CD provided as per data maintained for such kind of internal process work will never match for the reason that there is duplication or triplication of work. The final job bill is prepared on the basis of final output which is recorded in FAS software i.e. books of account. The assessee further explained that the Assessing officer mentioned in the assessment order that there are some parties listed in purchi software which are not reflected in the job work as per books of account. The assessee explained that during the process, depending on the quality of grey material, process is decided by design department in 3 or 4 cycles and this double work ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound in the file data retracted from Purchi, which is related to reprocessing work carried out by the assessee. The process of cycle runs through lot allotment, lot marketing, stitching, drum/jet process, setting on stanter, folding, batching, printing, loop for colour fixsession, washing etc. During the process cycle, until the process results are not received as per desired outcome it is reprocessed again and again. For reprocessing entry has to be made in Purchi software until final job bill is not made. After final output as per required design and print is arrived and approved by customer, job bill is prepared for 100 Metre of grey work and final product is then dispatched which is finally recorded in FAS software. The assessee claimed that if there is unaccounted job work done by the assessee then there would have been some unaccounted investment in the form of stock or other raw material, which would have been found during the course of search/survey proceedings. However, the exact stock tallied with the regular books maintained by assessee and prayed for deleting the addition. The ld. CIT(A) recorded that on considering the contention of assessee, it is clear that the data ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10-11 to 2015-16 held that the average net profit in all the years is 1.82%. The ld. CIT(A), accordingly restricted the addition of suppressed job work to the extent of 5% to the total turnover of Rs. 2.589 crores and granted substantial relief to the assessee. Further aggrieved, the assessee has filed the present appeal before this Tribunal. 6. We have heard the submissions of learned Authorised Representative (AR) of the assessee and the learned Commissioner of income tax- departmental representative (ld. CIT-DR) for the revenue and have also gone through the orders of the authorities below carefully. The ld. AR of the assessee submits that the Assessing officer made addition @ 20% of alleged suppressed job work expenses on comparison of books of account and the data extracted from Purchi software. The Assessing Officer failed to appreciate the reprocessing work undertaken by the assessee. The assessee explained that the data recollected from Purchi software was not real. Entire stock tallied with the books of account and there was not unaccounted finished stock or WIP found during the course of search action. The ld. AR submits that the entire addition is liable to be deleted a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n shows that the claim of reprocessing is not genuine. On the basis of such discrepancies, the Assessing Officer was of the view that there are two different set of data related to job works maintained in the computer and data maintained in Purchi software is not accounted in the books of account. The Assessing officer disallowed 20% of receipt of unaccounted job work by treating as 20% profit of such unaccounted job work. 10. As noted above, before the ld. CIT(A), the assessee has filed detailed written submission. The ld. CIT(A) after considering the submission of assessee noted that it is clear that the data found stored in file of Purchi software does not match with the regular books of account, thus the Assessing officer has proved beyond doubt with detailed discussion in the assessment order that the data recorded in this file remains unaccounted. The documentary evidences in the form of invoices and job bills found, there were several differences between these documents, which the Assessing Officer has narrated in detail in the assessment order. The entries have been made from about 50 parties by the DDIT (Inv.) to verify the contention of assessee about reprocessing work f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , we do not find any merit in further reducing the addition which has already been reduced substantially by the ld. CIT(A). Therefore, we do not find any justifiable reason to given further relief to the assessee.
13. In the result, this appeal of assessee is dismissed.
14. Now we take appeal for the A.Y. 2014-15 being IT(SS)A No. 68/Srt/2021 and appeal for A.Y. 2015-15 being ITA No. 157/Srt/2021 wherein the assessee has raised similar grounds of appeal as raised in appeal for AY 2013-14, except variation of addition. In both these appeals, the grounds, facts and submissions of both the parties are identical to the grounds, facts and submissions made in IT(SS)A No. 67/Srt/2021 for the A.Y. 2013-14. Considering the fact that we have dismissed the appeal of assessee in A.Y. 2013-14 by upholding the order of ld. CIT(A), therefore, considering the principal of consistency the grounds of appeal of in IT(SS)A No. 67/Srt/2021 for the A.Y. 2013-14 are dismissed with similar directions.
15. In the result, all these three appeals of the assessee are dismissed.
Order pronounced on 17/08/2022, in open court and result was also placed on notice board. X X X X Extracts X X X X X X X X Extracts X X X X
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