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TMI Blog2016 (11) TMI 802X X X X Extracts X X X X X X X X Extracts X X X X ..... question of law: Substantial question of law for assessment year 1991-92: "Whether the ITAT was justified in law in having upheld the action of the Assessing Authority in having drawn an adverse inference about shortages/wastages inspite of the fact that the Books of Accounts have been maintained strictly in accordance with the well established practices of the Appellant accepted by the Department for last so many years and whether the finding of Tribunal is perverse?" Substantial question of law for assessment year 1992-93: "Whether the ITAT was justified in law in upholding the action of the Assessing Authority in making trading additions merely by presuming percentages of waste, shortages and yield without rejecting the Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the business which has been carried out by the appellant assessee is based on agricultural produce which has many factors for final product to be out come in view of the quality of seeds of Mustard which are received. He has taken us to the record paper book submitted by him and pointed out that the questions which are framed for the relevant year prior to the year 1991-92 to 1996-97, books of accounts are accepted and for the first time during these five years, the books of accounts are rejected under Section 145(2) of the Income Tax Act. 3.1 He has taken us to the order of the Assessing Officer where the Assessing officer while observing against the assessee, has observed that there is difference of production of 0.14%, for the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at a regular interval. The purchase and sales are completely vouched. The A.O. has not pointed out any instance of sales out of books of account. The A.O. was not justified in making addition merely on the ground the rate of yield declared by the appellant is alightly in comparison to the rate of yield of last year. Since the A.O. has not brought maintained by the appellant is defective, his action of invoking the provision u/s 145(2) for making the addition deserves to be cancelled and the addition made may be deleted." 3.3. The observations made by the CIT (Appeals) in para 2.3 reads as under: "I have considered the arguments of the appellant and have also gone through the finding of the A.O. in the assessment order. Admittedly, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... served by the coordinate Bench that addition cannot be made merely on the basis of suspicion and no addition can be made without establishing suppression of production. But the said case was related to the search and seizure where certain discrepancies in stocks were noticed. On physical verification, the mustard oil was found short. But in the instant case, there is no case of search and seizure and no question of money seized. This is the case of adjournment of the entries in the books of account as alleged by the ld. D/R. The AO has already opined that the assessee has not recorded full and true yield in its books of account so he has already applied the provisions of section 145(2)." 3.5. In view of the facts on record, he contended th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19626319.33 5.35% 13. 2000-01 197840856.49 19383711.30 9.80% 7053487.68 3.56% 5. Taking into account the net profit which is maximum 6.07% to minimum 0.60% and even if that is taken average net profit will come to around 3%. Taking into account, the counsel for the appellant contended that the view taken by the Tribunal is just and proper and no interference is called for. 6. We have heard learned counsel for both the parties. 7. Taking into account the observations which have been made by the CIT (Appeals) in para 2.2 and 2.3, reproduced above, we are of the opinion that the books of accounts ought not have been rejected by the Assessing Officer. We are in complete agreement with the view taken by the CIT (Appeals) and the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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