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The Commissioner of Income Tax, Jalandhar-II Versus M/s Laggar Industries Ltd.

2015 (12) TMI 626 - PUNJAB & HARYANA HIGH COURT

Addition on account of suppression of sales - rejection of the books of account - ITAT deleted the addition - Held that:- Tribunal being a final fact finding authority has not examined the material and evidence on record. Detailed reasons have not been given for deleting the additions. Consequently, the impugned order is set aside and the matter is remanded to the Tribunal to decide it afresh after hearing learned counsel for the parties in accordance with law and giving detailed and cogent reas .....

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appeals is identical. However, the facts are being extracted from ITA No.49 of 2013. 2. ITA No. 49 of 2013 has been filed by the revenue under Section 260A of the Income Tax Act, 1961 (in short, the Act ) against the order dated 20.11.2012, Annexure P.3 passed by the Income Tax Appellate Tribunal, Amritsar Bench Amritsar in ITA No.91(ASR)/2011, for the assessment year 2007-08, claiming following substantial questions of law:- i) Whether on the facts and circumstances of the case and in law, the .....

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oduction and sale had taken place throughout the year which fact has also been confirmed by the learned CIT (A)? ii) Whether on the facts and circumstances of the case and in law the Hon'ble ITAT has failed to appreciate that the CIT(A) had confirmed the addition of ₹ 5,59,50,097/- which also included the unexplained investment relating to unaccounted sales? In ITA No.50 of 2013, the following question has been claimed by the revenue:- Whether on the facts and circumstances of the case .....

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nd found that unaccounted production and sale had taken place throughout the year which fact has also been confirmed by the learned CIT (A)? 3. A few facts relevant for the decision of the controversy involved as narrated in ITA No.49 of 2013 may be noticed. The assessee filed its return of income on 30.10.2007 declaring total income of ₹ 9,29,133/-. During the assessment proceedings, the Assessing Officer made addition on the basis of the data submitted by the assessee (Chart A) in which .....

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was a very high ratio as compared to the percentage of scrap generated by standard mills using induction furnaces or rotary furnaces. The Assessing Officer asked the assessee to show cause as to why the production should not be worked out on the basis of normal ratios of production by other mills. The assessee submitted that there were mistakes in the figures submitted before the Assessing Officer by its accountant. The assessee submitted a fresh chart showing the consumption of raw material, pr .....

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essee had valued its closing stock of angle at a rate of 11.89% higher rate than the average sale rate of Angles and closing stock of rods was valued at rates 52.52% higher than the average sale rate of rods. The closing stock of scrap was valued at rates 95.92% higher than its average sale rate. He valued the sale rate of the production of 10117.48 MTS of finished goods of angle and rod and 432.83 MTS of scrap at the rate taken in closing stock for valuing them to arrive at the difference in sa .....

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of the assessee and dismissed that of the revenue by deleting the addition of ₹ 5,59,50,097/- made on account of suppression of sales which was sustained by the CIT(A). Hence the instant appeals by the revenue. 4. We have heard learned counsel for the parties. 5. A perusal of the orders passed by the authorities below shows that the assessment order was passed by the Assessing Officer on the ground that there was variation in the ratios of production to raw material consumptions, of scrap .....

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ince the assessee was maintaining excise records of purchase and sales. The source of the revised figures of raw material consumption was not entered into the stock register produced by the assessee before him. Further it was held that the revised figures were manipulated and the assessee's books were not reliable and the same were rejected. On appeal by the assessee, the CIT(A) recorded that the Assessing Officer was not justified in taking the rate of goods in the closing stock as the rate .....

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