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2023 (5) TMI 572 - AT - Income TaxRejection of books of accounts u/sec 145(3) - assessee made bogus sales of rice - survey operation was carried out at the premises of the assessee - HELD THAT:- The entire addition is made on the statement recorded from Mr. Rajesh Dhawan prop. M/s. Vasudeva Sales Corp. But the statement recorded in survey u/s. 133 was not served to assessee. The entire gross sales was duly declared in the turnover of the assessee during the filing of return. There are no discrepancies in the purchase or in stock of the assessee. The only discrepancies found in sales on the basis of recorded statement of the party which was finally added back to the total income of the assessee. The books of accounts are rejected u/s. 145(3) of the Act without finding any lacuna in the books of assessee. We respectfully relied on the case of Roopchand Tharani [2011 (11) TMI 426 - CHHATTISGARH HIGH COURT] to find that there is no specific discrepancy for rejecting books of accounts by the assessee u/s. 145(3). So, grounds taken by the assessee in this context is fully allowed. Addition on the basis of statement of the party - Assessee was not allowed to cross examination of the party before the addition. We respectfully relied on the order of Sona Builders &Andaman Timber Industries [2001 (7) TMI 3 - SUPREME COURT] the reasonable opportunity for the assessee was denied without allowing cross verification of the party. The assessee already informed and prayed to the revenue for the said verification of the party who had made the statement against him. AO has totally assumed that the cash was deposited in the bank account of the party belongs to the assessee. So the additions have been made by the AO on the basis of the surmises and conjectures, ignoring the evidence produced before him by the assessee. There is lack of cogent evidence in respect of addition of sales of the assessee, respectfully relied on, Lalchand Bhagat Ambica Ram [1959 (5) TMI 12 - SUPREME COURT] The assessee cannot be taxed doubly in same amount which was already declared in the return of income. The ld. AO has already calculated the GP ratio @ 11.87% which is working out at Rs. 2,72,17,362/-. But there is no separate addition was made. We find the continuity in the GP ratio in the preceding and succeeding years with impugned assessment year of the assessee Assessee disclosed the entire sales, payment was received through banking channel. The assessee is not at all beneficial of the said amount. Stock of goods and purchase was duly accepted in the order of assessment and in the subsequent assessment order. The entire submissions were submitted before the revenue authorities by the assessee including stock statement and the details of purchase. Recorded statement of the part had the evidentiary value. But without the cross examination, the statement is itself in nullity, respectfully relied on SMC Share Brokers Ltd, [2006 (8) TMI 110 - DELHI HIGH COURT] - The addition cannot be made mere on the basis of doubts or conjecture. We are setting aside the appeal order passed by the ld. CIT(A). Considering the above, the addition is quashed. Appeal of assessee allowed.
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