TMI Blog2010 (7) TMI 993X X X X Extracts X X X X X X X X Extracts X X X X ..... re the Assessing Officer alongwith list of share application money with relevant evidences. On scrutiny of the said details, the Assessing Officer has noted certain lacunae, such as, the applicants were alleged to be low paid, illiterate, agriculturist, not subject to tax and that the money was received in cash. Though the Affidavits were annexed along with explanation tendered from the side of the assessee, but those were said to be stereotype by the Assessing Officer and rejected. The Assessing Officer has asked to produce the share applicants as well. In his opinion, the assessee has not fulfilled the conditions, such as to establish the identity, capacity, genuineness and the creditworthiness, hence, finally the said amount of ₹ 23.50 lacs was taxed in the hands of the assessee u/s.68 of the I.T. Act, 1961. The said addition was challenged. 3. The Learned CIT(Appeals) has examined the facts of the at length and thereafter vide paragraph No.3.2 allowed the claim as follows: 3.2. I have considered the submissions of the A.R. carefully. I find that the appellant has submitted copies of share application forms and copies of identity cards issued by the Election Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . [205 ITR 98 (FB)] have been relied upon and the issue was decided in favour of the assessee. Under these circumstances, and also considering the case laws, we hereby affirm the findings of the Learned CIT(Appeals). With the result, this ground of Revenue is hereby dismissed. 5. Second ground of the Revenue reads as follows:- 2. The Ld. CIT(A) has erred in law and on the facts in deleting the addition of ₹ 3,51,70,869/- made on account of excessive claim of burning loss. 5.1. It was noted by the Assessing Officer that as per Audit Report, the assessee has suffered a burning loss at 45.80%. As per Assessing Officer that percentage of loss was highly excessive. During the course of proceedings, the assessee has re-worked out the loss and informed the Assessing Officer that actually the burning loss was at 38.39%. The difference between the two percentages was stated to be on account of taking into calculation the consumption of Hard Coke which was mistaken added by the Tax Auditor. Nonetheless, as per Assessing Officer no prudent business-man would tolerate such huge burning loss. The respondent-assessee has furnished the excise records but those were ignored by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... H.Talati Learned Authorised Representative of the assessee appeared and both of them have respectively relied upon the judgements of the Assessing Officer and the Learned CIT(Appeals). 8. Before us, one of the argument of the respondent-assessee was that the Assessing Officer has disturbed the book results by disturbing the burning loss and making the addition in the hands of the assessee but without rejecting the books of account of the assessee. Therefore, it was argued that if no defect was found in the books of account, then there was no occasion to disturb the book results of the assessee, though the admitted position is that the assessee is not in cross-objection , but to be adjudicated because this ground has substantial legal force. As far as the position of the books of account were concerned, it was vehemently contested that all the sales and purchases were fully vouched and no discrepancy was found during the course of investigation. In addition to the routine books of account, the assessee has also maintained quantitative record. It has also been informed that the RG-1 Register as prescribed by the Excise Department has also been maintained by the assessee. In respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of Learned Authorised Representative of the assessee before us was that the uncomparables must not be compared. Further extending this argument, it was mentioned that in a similar type of industry in the case of M/s.Metal Man, the burning loss shown at 36.46% which was stated to be very near to the burning loss of the assessee as per books at 38.39%. Even at this juncture we can comment that this explanation as well as the distinction make sense , which was not properly considered by the A.O. 9. Apart from the above factual details on enquiry from the Bench, the Learned Authorised Representative of the assessee has placed on record the figures of burning loss of subsequent years. For Assessment Year 2006-07 the burning loss including Hard Coke was computed at 50.46% by the Auditor and excluding Hard Coke it was 42.73%. It was clarified by the Learned Authorised Representative of the assessee that for Assessment Year 2006-07, the assessment was completed u/s.143(1) of the I.T. Act, 1961. For the next Assessment Year 2007-08, the assessment was made u/s.143(3) of the I.T. Act, 1961 order dated 11/12/2009 and in that assessment year, there was no addition on account of burning lo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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