TMI Blog1995 (4) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... f accounts of the assessee and, therefore, the Asstt. CIT addressed a letter dt. 1st Feb., 1989 to the assessee-firm to explain as to why the above transactions be not treated as sales made from outside the books of accounts. Vide letter dt. 25th Feb., 1989, the assessee- firm denied to have made any sales to the said company with the exception of those which were already recorded in its books of accounts. Thereafter, the Asstt. CIT analysed the consumption of raw material, production, shortages and power consumption. According to him, the electricity consumption varied from month to month and was not in consonance with the quantity of raw materials crushed; the production of cotton seed oil varied from month to month and the shortages varied from month to month. According to the Asstt. CIT, therefore, the said suppressed sales were nothing but shown in the form of low yield and excess shortages. He, therefore, added a sum of Rs. 7,63,619 as suppressed sales. 4. On appeal, the learned CIT(A) deleted the addition on the following grounds: (1) The Asstt. CIT has merely created a suspicion by discussing elaborately monthwise production, yield of oil, oil cake and consumption of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t only from the assessee and the associated concerns but also from outside parties on large scale. According to the CIT(A) if Hynoup Food Oil Industries P. Ltd. did some unaccounted purchases and noted the name of the assessee, it could not be said that the sales in fact were made from the assessee and not from other parties. 5. Shri M.S. Rai, the learned Departmental Representative, submitted that the CIT(A) has not properly appreciated the facts of the case. According to him, the CIT(A) ought to have noted that the diary was seized in a search at the residential premises of one of the directors of M/s Hynoup and the entries made therein were in a very systematic and normal style. These were not by any stretch of imagination cooked up entries. According to the Departmental Representative, the CIT(A) should have called for a remand report from the Assessing Officer or should have restored the issue to his file to establish the facts in the correct perspective. He, therefore, prayed that to ascertain correct facts the matter should be restored back to the file of the Assessing Officer. The learned Departmental Representative further relied upon the decision of the Tribunal Ahme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. We have considered the rival submissions and perused the facts on record. At the outset we must state that the facts here are identical with those of Patel Oil Mills Ginning Factory, Kadi where an addition of Rs. 6,87,068 made by the Assessing Officer to the assessee's returned income on account of allegedly suppressed sale of cotton seed oil to M/s Hynoup on the basis of entries in the seized diary at the residential premises of one of the directors of the said concern, which was confirmed by the CIT(A), was deleted by this Tribunal to which one of us (Accountant Member) was a party. For the reasons given in the aforesaid decision of the Tribunal we find no ground to sustain the addition of Rs. 7,63,619. 8. In addition to the above, we would like to support our decision by the following observations. As stated above the impugned addition has been made by the Assessing Officer on two grounds, viz., erratic yield of oil cake compared monthwise and secondly on the basis of some notings made in the note book found at the residential premises of one of the directors of the firm M/s Hynoup during the course of search. In our view, both these points have been very ably dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We find that all the basic facts were before the Assessing Officer and he appreciated the same and arrived at a definite conclusion. In this we are supported by the judgment of the Gujarat High Court in the case of CIT vs. H.J. Patel where it has been held that where foundational facts do not exist raising even a remote doubt regarding the genuineness of the firm and/or the transaction in question, a second innings should not be permitted to the Revenue as it would result in avoidable hardship and harassment to hundreds of assessees. In the present case the facts have been thoroughly marshelled by the Assessing Officer and the CIT(A) and after hearing detailed arguments from both the sides, put before us we do not feel any necessity to restore the matter back to the file of the Assessing Officer. 10. Coming to the arguments of the Departmental Representative that the ground is covered against the assessee by our order in the case of Rajdeep Sales Agency. We find that the facts here are distinguishable. In the case of Rajdeep Sales Agency the assessee-firm admitted that the said entries in the seized documents represented payment for the purchases made by the assessee-firm. In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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