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TMI Blog2017 (6) TMI 723X X X X Extracts X X X X X X X X Extracts X X X X ..... fall in G.P. 1(ii). That the Ld. CIT(A) has erred in law and on facts in not appreciating the facts that item wise details of quantity, rate; of opening/closing stock/purchases were not filed. Even the stock register was not produced. 1(iii). That the Ld.CIT(A) has failed to appreciate that inspite of surrender of income of Rs. 1.60 Cr., returned income stood at Rs.l,10,92,666/- only. 2. The Appellant craves leave to add or amend the grounds of appeal on or before is heard and disposed off. 3. It is prayed that the order of the Commissioner of Income Tax (Appeals), be set-aside and that of the AO be restored on merits." 3. The only issue in the present appeal relates to deletion of addition of Rs. 40,55,661/- made on account of fall i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmissions/arguments of the AR during the appellate proceedings have been considered. The AR has submitted that additional income of Rs. 160 Lacs surrendered during search has been duly reflected in the books of account; Rs. 110 Lacs as additional income on account of difference in stocks, Rs. 35 Lacs undisclosed/unrealized sales/debtors and Rs. 15 Lacs under the head unexplained documents & expenses. The AR submitted that from the above it can be seen that surrender of Rs. 145 Lacs towards difference in stocks and undisclosed/unrealized sales/debtors is more than the addition of Rs. 40,55,661/- made by the AO towards fall in GP rate. Further, Rs. 15,00,000/- was surrendered towards unexplained documents/expenses which is more than the disa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons it is seen that vide letter dated 18.01.2013 quantitative and value wise details of opening and closing stock and basis of valuation was given to the AO. Also month wise details of purchases and sale (value wise) and yearly sales & purchase quantity wise was also given. During the appellate proceedings, a copy of the same has been filed and placed on record. The AR has given a detailed analysis of power and fuel consumption for the current year compared with last year along with its relation with the production/sale. After examination of the facts relating to the case and the documents filed by the AR including the reply filed before the AO during assessment, the contention of the assessee appears acceptable that the AO was not correct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsumption and raw material. The learned CIT (Appeals),we find, has after examining the documents filed before him given a categorical finding that quantity-wise and value-wise details of opening and closing stock and basis of valuation was given to the Assessing Officer as also month-wise detail of purchases and sales. The learned CIT (Appeals) has also stated that the detailed analysis of power and fuel consumption for the current year compared with the preceding year alongwith its relation with production or sale had also been filed. The learned CIT (Appeals) has given a categorical finding after examining the said details that the contention of the assessee that regular books of account supported by purchase and sale bills and vouchers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 10. We also find that the GP rate had increased in the current year from Rs. 411.64 lacs in the preceding year to 499.55 lacs in the impugned year. It is also admitted fact that the assessee had surrendered additional income during the course of search amounting to Rs. 160 lacs which included Rs. 145 lacs on account of difference in stock and unrealized sales/debtors. Undoubtedly the assessee's surrender on these counts, which form part of GP, is much more than that being made by the AO and for this reason also there is no justification for making any addition on account of fall in GP. 11. Further, we find that the Coordinate Bench of the ITAT in the case of M/s Sharman Udyog Pvt. Ltd. (supra), on identical set of facts and circumstance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er various heads but had returned income at lesser amount. The justification of the assessee for the same was identical as being on account of increase in depreciation claim and on account of increase in financial expenses. The Assessing Officer had attributed the same to fall in GP rate and had noted that the power and fuel consumption had increased more than as compared to increase in sale and further that quantity-wise details of purchase and closing stock had not been filed. The Assessing Officer had, therefore, rejected books of account and applied GP rate resulting in addition to the income of the assessee. The Ld.CIT(Appeals) set aside the rejection of books of account by giving categorical finding that the assessee had demonstrated ..... X X X X Extracts X X X X X X X X Extracts X X X X
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