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TMI Blog2017 (2) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... hiana, may kindly be set aside and benefit of set off losses and depreciation may kindly be allowed against the addition so made u/s 68 of the IT Act 1961." 2. We have heard the Ld. Representatives of both the parties and perused the material on record. Briefly stated, the facts of the case are that assessee is a company engaged in forgings of auto parts, hardware and railway parts, scaffolding items etc, trading of cloth etc. and trading in commodities. The Assessing officer noted that assessee in response to the questionnaire attended the assessment proceedings from time to time and furnished information as called for. The books of account along with relevant documents were also produced which were examined and test checked. The assessee disclosed 'nil' income. Schedule-10 of the Audit report shows "other income" of Rs. 6,21,63,739/- which includes Rs. 4,37,47,870/- as commodity income. During the course of assessment proceedings, details regarding the genuineness of the said commodity income were called for. The Assessing officer noted that assessee has not been able to prove the bona fide of the said transactions and, therefore, alleged income from commodities is witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stion of not producing of any credible evidence. PAN number of Rakesh Kumar Prop. of M/s Ludhiana Comfin Services was also produced and since he has shifted to foreign country and he is not cooperating with the assessee in furnishing information, therefore, summons can be issued against him. Ultimately, as per remand report of the Assessing officer, Shri Rakesh Kumar was not traceable and was not produced before the Assessing officer in the remand proceedings. The Ld. CIT(A) therefore, confirmed the order of the Assessing officer holding that above amount to be unaccounted money of the assessee since the assessee failed to produce proprietor of M/s Ludhiana Comfin Services before the Assessing officer. The Ld. CIT(A) also relied upon his order in the case of Sh Jawahar Lal Prop. M/s Sahi Ram Jawahar Lal, in which on identical facts, the issue was decided against the assessee. The Ld. CIT(A) accordingly dismissed the appeal of the assessee . 5. The Ld. Counsel for the assessee reiterated the submissions made before the authorities below and referred to PB-34 to show that other income earned by the assessee includes income from commodities purchase / sales of the impugned amount. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d upon his order in the case of Sh Jawahar Lal Prop. M/s Sahi Ram Jawahar Lal, (supra) which have been set aside by the ITAT Chandigarh Bench in the matter of Jawahar Lal Vs. ITO in ITA No. 75/Chd/2012 dated 29.5.2014 and in the matter of Jawahar Lal Vs. ITO in ITA No. 785/Chd/2015 (assessment year 2011-12) dated 19.7.2016, therefore, order of CIT(A) is liable to be set aside. He has submitted that section 115 BBE have been inserted in to the Income Tax w.e.f. 1.4.2013 to say that addition u/s 68 would be on account of deemed income and flat rate of tax would be charged, therefore, it would not apply to the assessment year under appeal i.e. 2011-12. The Ld. Counsel for the assessee, therefore, submitted that addition is liable to be deleted. He has stated that ground No.2 is consequential in nature. 7. On the other hand, Ld. DR relied upon the orders of the authorities below and referred to the assessee's reply before Ld. CIT(A) (Pages 11 to 14) in which assessee's submissions was that unabsorbed depreciation and current year depreciation may kindly be adjusted against the income assessed u/s 68 of the I.T. Act. He had submitted that in the case of Jawahar Lal (supra), par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and relevant documents at assessment stage. Therefore, assessee filed the relevant and requisite documentary evidence before the authorities below to prove that assessee genuinely entered into the transaction of sale and purchase of commodities. The assessee has known source of income from sale / purchase of commodities. The assessee has filed copies of the audited accounts in the paper book and in Schedule 10 of 'other income' as mentioned which include Rs. 4,37,47,870/- as income from commodities purchase / sale. In the preceding assessment year 2010-11, the assessee has shown Rs. 84,14,930/- on account of income form commodities purchase and sales. The assessee also filed audited accounts of the preceding assessment year 2010-11 along with computation of income and acknowledgment of return of income. The assessee also filed copy of the assessment order u/s 143(3) for assessment year 2010-11 dated 28.12.2012 in which the similar nature of source of income from commodities purchase / sales have not been disputed by the Assessing officer and income from the same source have been accepted by the Assessing officer as income from business. Since the same source of income ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allegation that the transactions were speculative could not be sustained. The fundamental nature of the transactions was examined year after year more importantly in the assessment year 1986-87 it was specifically considered by the Commissioner (Appeals) and it remained the same. Given the fact that the assessee had been engaged in these transactions in the preceding assessment years, the Commissioner could have had no occasion to have recourse to the revisional powers under section 263 of the Act on the fundamental aspects of the transactions in issue on which a view had been taken and not shown to have been challenged." 12. Considering the above discussion, evidences and material on record, it is clear that assessee has declared business income on account of purchase / sale of commodities in earlier years which have been accepted by the Revenue Department. The rule of consistency do applies to the Income tax proceedings. Therefore, on the same source of income, Revenue should not doubt the transaction carried out by the assessee on account of commodities purchase and sales in assessment year under appeal. The assessee has known source of these transactions as business income, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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