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2019 (8) TMI 1275 - HC - Income TaxAddition for the lesser cash in hand found as compared with the books of account - applicability of section 68 or 69A - difference of cash balance as reflected in the balance sheet and cash as per seized documents - HELD THAT: - Addition made of ₹ 37,30,710/-, which is lesser cash in hand as compared with the books of accounts in which the assess has shown more cash in hand, the Tribunal held that it is neither a case under Section 68 nor Section 69-A. The Tribunal further went on to hold that it was not a case where money is not recorded in the books of account of assessee, and in the present case cash in hand in the books of account was found to be more than the actual cash found during the course of search. At the most, authorities could have presumed that assessee has spent the difference of amount in question somewhere as per cash in hand, as per books of account and lesser cash as per seized documents, but that would also not suffice to make addition under any of the above propositions. Addition in respect of alleged business of potato - assessee is ruining a cold storage - allegation for violation of the provisions of U.P. Regulation of Cold Storage Act - HELD THAT:- Tribunal has also recorded a categorical finding that no evidence of purchase, sales or unaccounted stock belonging to the assessee during the course of search or survey was found or established, thus, there was no justification for the authorities to make or confirm the addition of the said amount. There is no doubt that the business of running a cold storage is governed by the U.P. Act of 1976 and it is only after the grant of licence by the licencing authority that a cold storage can run according to the terms and conditions of the licence. Any violation of the terms of licence has penal consequences as provided under Section 37 and 38 of the Act, for which the Magistrate of Ist Class is empowered to take cognizance of any offence so made by the licence holder. As, in the case in hand, during the search and survey in the business premises of the assessee, no such violation was found or recorded, nor any notice was given or action was taken against the asssessee, as is evident from the perusal of the documents before us. Further, the counsel for the Revenue also could not point out to any such violation made by the assessee of the U.P. Act of 1976. Once it is established that the assessee had not violated the terms of licence, so granted by the licencing authority, merely on the basis of presumption and assumption from any documents or papers seized during search and survey cannot be the basis for the addition of such an amount. Revenue has failed to establish that the order of the Tribunal is manifestly illegal and suffers from error apparent on face of the record. As the Tribunal being the last fact finding court has categorically recorded finding that the authorities below had wrongly made the additions without any material on record on the basis of mere presumption and assumption. - Decided in favour of the assessee.
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