Commissioner Of Income Tax, Hisar v. M/S Hanuman Oil & General Mills, Ellenabad, Distt. Sirsa

IN THE HIGH COURT OF PUNJAB AND HARYANAAT CHANDIGARH ITA No.152 of 2008Decided on : 03.11.2008 Commissioner of Income Tax, Hisar. ....Appellant. VERSUS M/s Hanuman Oil & General Mills, Ellenabad, Distt. Sirsa. ....Respondent. CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOELHON'BLE MR. JUSTICE L. N. MITTAL Present:Mr. Sanjeev Kaushik, Sr. Standing counsel for the appellant-revenue. ADARSH KUMAR GOEL J.(ORAL) 1.The revenue has preferred this appeal under Section 260A ofIncome Tax Act, 1961 against the order of learned Income Tax AppellateTribunal, Chandigarh Bench “B” Chandigarh passed in ITANo.248/Chandi/2006 dated 18.05.2007 for the assessment year 2003-04proposing to raise following substantial question of law:- i) “Whether on the facts and in the circumstances of the case,the Tribunal is right in law in deleting the addition ofRs.29,50,950/- made on account of value of excess stock ofNarma/Kapas found by the Market Committee authorities during the course of surveys carried out on the assessee'sbusiness premises not only once but on different dates i.e.18.12.2002, 07.01.2003, 13.03.2003 which was not foundentered in the account books and investment for purchasethereof outside the account books? ii) Whether on the facts and in the circumstances of the case,the Tribunal is right in law in deleting the addition referredto above by recording an erroneous finding contrary torecord, that there was no adverse material especially whenthe A.O. disbelieved the books of account maintained by theassessee by recording specifically?” 2.In the course of assessment, the Assessing Officer held that atthe time of inspection, excess stock of cotton was found by therepresentative of Market Committee, over and above the stock entered in thebooks of account. The said stock was liable to be added to the income. Theassessee explained that there was no excess stock and even the MarketCommittee did not assess fee on the alleged excess stock, though by way ofcompromise, the assessee paid the sum of Rs.13,200/- towards market fee.The partners of the firm were residing in Bangalore and Bhubneshwar andthere may be some discrepancies in maintenance of record. 3.The CIT(A) had accepted the explanation of the assessee. Thisview has been affirmed by the Tribunal. 4.We have learned counsel for the revenue. 5.Finding recorded by CIT(A) on the issue in question is asunder:- “I have carefully gone through the facts and circumstances of ITA No.152 of 2008 the case and results of enquiries conducted by the AssessingOfficer during remand proceeding and find as under: Thepurchases of 103 quintals (vide bill No.43) of M/s SinglaEnterprises, figure at purchase book on 18/12/2002 and appearsat unnamed sr. nos. of weight purchased 33.60, 39.80, 29.60quintals at top, bottom, end of page dated 18.12.2002 of gateinward register (inward serial no. of mandi missing, goodshaving not purchased through auction). Similarly, thepurchases of 770.20 quintals and 671.80 quintals are entered aspurchases from M/s Singla Enterprises at purchase book on24.12.2002 and 25.12.2002. The entries in gate book of date24.12.2002 and 25.12.2002 (with no serial number of auctionetc.) are found. Accordingly, I am of the opinion that in viewof the fact that the purchases have been found entered in thebooks and that there is no adverse inference in respect of suchpurchases from the Assessing Officer and the fact that thebooks of account have not been rejected by the AssessingOfficer, the addition made by the Assessing Officer ofRs.2,11,150/-+Rs.27,39,800/- does not deserve to be sustained.Appellant gets a relief of Rs.29,50,950/-. However, theadditions of Rs.38,400/- and Rs.76,000/- are hereby confirmedin view of the stock having been found by the marketauthorities and no explanation forthcoming from theappellant.” The Tribunal affirmed the above observations. The Tribunal affirmed the above observations. 7.View taken in the said order is a possible view and is notshown to be perverse. We are unable to hold that the questions raised aresubstantial questions of law. 8.The appeal is dismissed. ( ADARSH KUMAR GOEL )JUDGE November 03, 2008ashish ( L. N. MITTAL ) JUDGE