TMI Blog2014 (5) TMI 1102X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,32,992/- be taken as income of the assessee which comes to ₹ 2,46,649/-. The appellant had already disclosed income at ₹ 1,30,757/- and returned income at ₹ 95,114/-. After reducing the amount of returned income, the net addition is worked out at ₹ 1,15,892/-; whereas as per the peak theory of investment, the maximum balance was at ₹ 2,05,643/-. The appellant had not established that all the cash deposited in the bank account came from the sale proceeds of the assessee. In the absence of complete books of accounts, we estimate the assessee’s income for the year under consideration at ₹ 2.05 lacs on the basis of ‘peak’ plus ‘income’ disclosed by the assessee in the return. When assessee’s income has been estimated on the basis of facts, no other addition remained to be justified as held by the various courts on this issue. - Decided partly in favour of assessee - I.T.A. No.116/Ahd/2011 - - - Dated:- 30-5-2014 - SHRI KUL BHARAT, JUDICIAL MEMBER and SHRI T.R.MEENA, ACCOUNTANT MEMBER For the Appellant : Shri Mehul Shah For the Respondent : Shri Vivek Ojha, Sr.DR O R D E R PER SHRI T.R. MEENA, ACCOUNTANT MEMBER : This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year, the assessee has shown total purchases of ₹ 30,07,228/-. As the assessee did not produce the books of accounts, bills, vouchers, etc. before the AO, therefore AO held that purchases could not be verified and by relying the order of Vijay Proteins Ltd. reported at 55 TTJ 76, he disallowed 25% out of the total purchases of ₹ 30,07,228/- which comes to ₹ 7,51,807/-. (ii) Disallowance out of expenses The assessee claimed in the P L A/c. total expenses of ₹ 2,76,021/-. In the absence of books of accounts, but on the basis of computer print-out submitted by the ld.counsel for the assessee about the expenses, the AO disallowed ₹ 43,152/- on account of non-verifiable. (iii) Addition on account of difference in bank deposits and sales It was found by the AO thatin current bank Account No.0094- A42706-050 with Indus Ind Bank Ltd., Bardoli Branch the total deposits were ₹ 49,32,992/-, whereas the assessee has shown sales to the tune of ₹ 32,01,363/-, therefore, the assessee was asked to reconcile the deposits into bank account. The appellant had not submitted any detail except a certificate from Mahuva Pradesh Sahakari Khand Udhyog M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deposits in the bank account. In response, the appellant s A.R. did not submit any details except a certificate from Mahuva Pradesh Sahakari Khand Udhyog Mandli stating that the said Mandli had paid ₹ 5,88,200/- to the appellant during F.Y. 2006-07. The certificate did not give the nature of the said payments. The appellant did not produce bank book before the A.O. In absence of any explanation supporting evidences or bank books, the nature of credits in the bank account remained unexplained and these were treated as unexplained cash credits u/s.68 of the I.T. Act by the A.O. He therefore, made an addition of ₹ 17,31,629/-. 4.1. As may be recalled the appeal of the appellant was fixed for hearing on four different occasions but no submissions have been made. However, in the grounds of appeal the appellant mentioned that the figures of credits in the bank account cannot be co-related with the figure of sales as the deposits are on account of agriculture income, cash withdrawn re-deposited, etc. and that these can be explained on the basis of bank book. 4.2. However, the said explanation given along with the ground of appeal is unacceptable as no books of accounts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord goes to show that there is no finding nor any material has been referred about the suppression of investment in acquiring the goods which have been found subject of undisclosed sales. He further relied upon the decision of Hon ble ITAT Ahmedabad (camp at Surat) in the case of M/s.Om Carting vs. ITO in ITA No.3375/Ahd/2007 for AY 204-05, wherein it was held that estimation cannot be irrational or arbitrary. He further relied upon the decision of ITAT B Bench Ahmedabad in the case of Kesharbhai Ghamarbhai Chaudhary vs. ITO reported at (2012) 23 taxmann.com 273 (Ahmedabad Trib.) for estimation of transport business. 4.2. At the outset, ld.Sr.DR supported the order of the ld.CIT(A). 5. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below as well as the case-laws relied upon by the ld.counsel for the assessee. It is true that without purchase no sale can be executed. The appellant had not produced the books of accounts before the AO, however made available copy of bank account to the AO on which addition had been made. The appellant had shown net profit on sale of ₹ 32.01 lac @ 4.08%. The A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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