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2021 (3) TMI 866 - ITAT JAIPURRevision u/s 263 - Addition u/s 69A of the Act read with section 115BBE - HELD THAT:- As documents and statement so recorded talks about clandestine removal of manufactured goods without issue of invoice and payment of duty and in other words, unaccounted and out of books sales and not about any stock of goods which is not entered in the books of accounts which was found and can be brought to tax under section 69A - Though one may argue that unaccounted sales and undisclosed investment in stock which has ultimately been sold are related to each other and a presumption can be drawn that where unaccounted sales are found during the course of excise search, it is likely that there is undisclosed investment in stock (which has ultimately been sold by the assessee) and thus, the same needs to be brought to tax. A presumption howsoever strong cannot substitute and take the role of credible and verifiable material/evidence which forms the basis and foundation of fastening the tax liability in hands of the assessee more so where each of these transactions carry different tax liability. Thus, in absence of any material available on record that there was undisclosed investment in stock, the very invocation of provisions of section 69A and section 115BBE by the ld Pr. CIT is not borne out of records and thus, there is no legal and justifiable basis to hold that the order so passed by the AO is erroneous. The show cause notice dated 29.11.2018 talks about the bringing to tax the unaccounted sales and it doesn’t talk about any undisclosed investment in stock which has been found during the course of search. Further, we find that during the course of revisionary proceedings, no further show-cause or query has been raised by the ld Pr CIT or for that matter, any discussions/deliberations with the assessee as to the applicability of provisions of section 69A and section 115BBE. The directions of the impugned order are clearly without providing an opportunity of being heard to the assessee and where such findings are recorded by the ld Pr CIT, it renders such findings legally unsustainable due to violation of principal of natural justice. We are of the considered view that the findings and directions of the ld Pr CIT contained are not borne out of material available on record and secondly, the such findings have been recorded without providing any opportunity of being heard to the assessee, therefore, such findings are hereby set-aside and to that extent, the order of the Pr CIT stands modified. Unaccounted turnover - There is no dispute regarding the quantum of unaccounted turnover of ₹ 1,77,95,859. The assessee has declared the same in its return of income and which has been accepted by the AO as well as by ld Pr CIT as there is neither any material on record nor any adverse finding recorded by ld Pr CIT disputing the same. Therefore, as far as the quantum of unaccounted turnover is concerned, the order so passed by the AO cannot be held as erroneous and prejudicial to the interest of Revenue. Therefore, the limited issue that remains to be examined is the rate of profit so declared by the assessee on such unaccounted turnover which has not examined by the AO which renders the assessment order as erroneous and prejudicial to the interest of the Revenue and therefore, to this limited extent, the directions of the ld Pr CIT are sustained and the matter is set-aside to the file of the AO to examine the rate of gross profit so declared by the assessee on such unaccounted turnover and decide as per law.
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