Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (9) TMI 922 - AT - Income TaxRejection of books of accounts - NP estimation - addition made by applying net profit (Declared by the assessee) @ 4.42% on suppressed sales - additional net profit earned by applying the net profit rate of 3.64% in place of 4.19% - HELD THAT:- As undisputed that no corroborative evidence has been found from the business premises of the assessee and the Income Tax Authorities have simply relied on the contents of the e-mail and the statement of Shri Manish Jain without leading further evidence which could strengthen the case of the Department and, therefore, we are unable to agree with such action of the Department in placing its entire reliance on such third party evidence without there being any corroborative evidence to make the impugned additions. Once again, we would like to refer to the statement of Shri Shiv Charan Lal, an Ex-employee, who has categorically stated that the assessee company used to destroy the alleged parallel invoices once the consignment was delivered. This statement of Shri Shiv Charan Lal goes contrary to the fact of invoices being recovered during the search at the residential premises of Shri Sanjay Dhawan. As also worth noting that as per the e-mail print out for June 2015, the bill numbers are running into series of 200 whereas as per the regular books of account the serial numbers of the invoices for the month of June 2015 is in the series of 700 onwards. Thus, this apparent contradiction castes a doubt on the veracity and the evidentiary value of the invoices recovered from the premises of Shri Sanjay Dhawan. Accordingly, on an overall view of the factual matrix of the case and for the various reasons as aforementioned in the preceding paragraphs, we are of the considered opinion that the Department could not have validly made the impugned additions by placing sole reliance on the invoices recovered from the residence of Shri Sanjay Dhawan as well as on the statement of the various third parties viz. S/Shri Gulshan Gaba, Naveen Salley and Sudhir Sethi which were recorded at the back of the assessee without giving the opportunity to the assessee to cross examine them. For the reasons mentioned in the preceding paragraphs, the impugned additions could not have been made on the basis of the statement of Shri Manish Jain and the electronic record discovered from the premises of the M/s. B.M Paper Mart, Delhi because the origin of the e-mail was not established. We have no option but to direct the deletion of the impugned additions in all the five years under consideration. As far as the issue of rejection of books of account is concerned, since we have already allowed the relief to the assessee on merits of the case by holding that the impugned additions are not sustainable, the question of rejection of books of account assumes only academic interest, and therefore, it is not being adjudicated at the present juncture.
|