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TMI Blog2019 (8) TMI 1275X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) Whether on the ITAT erred in law as well as on facts in deleting the addition of Rs. 23,31,28,321/- made on account of investment in potatoes in disregard of all the evidences on record, and the fact that this belonged to one of the partners Raj Kumar Kesarwani. (2) Whether the ITAT has erred in law as well as in the facts and circumstances of the case in deleting the addition of Rs. 37,30,710/- made on account of difference of cash balance as reflected in the balance sheet and cash as per seized documents on wrong appreciation of facts. (3) Whether the ITAT was justified in substituting it own views which were based on interpretation of word "either" as used by both the A.O. and C.I.T.(A) in coming to conclusion that case reflecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... count, in which the assessee has shown more cash in hand. The other major addition was of Rs. 23,31,28,321/- on the ground that the assessee was engaged in the business of potatoes. The CIT(A) accepted the addition so made by the AO. 6. Being aggrieved the assessee filed an appeal before the ITAT which was allowed to the extent as far as the addition of amount of Rs. 37,30,710/- and addition of Rs. 23,31,28,321/- are concerned, while the Tribunal remanded back the matter to the Assessing Authority as far the addition of Rs. 5,47,92/- on account of addition under the heading 'building'. 7. Sri Manu Ghildyal, learned Counsel appearing for the Revenue submitted that ITAT was not correct in deleting the addition of Rs. 23,31,28,321/- made o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were applicable, which according to him, the First Appellate Authority did not have the power to change the law to sustain the addition. 9. He further submitted that the assessee firm is not engaged in the business of potatoes and the assessee is running a cold storage and the business is of storing potatoes for which rent is realised from the farmers who store agricultural produce in the Cold storage. 10. The assessee maintains complete record as far as the storage of potatoes is done and the assessee maintains the storage (bhandaran) and delivery (nikasan) register and issues rent receipt for the period for which potatoes are stored. 11. Sri Ravi Kant, learned Senior Counsel further placed on record the U.P. Regulation of Cold Stora ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order or direction is contravened, then on conviction punishment with imprisonment for a term which may extend to two years or fine which may extend to Rs. 10,000/- or both shall be made. 14. Section 38 provides for the offences by companies, in the explanation to the said section, 'company' means any body corporate, and includes a firm or other association of individuals, and 'director' in relation to a firm, means a partner in the firm. Section 39 further provides for the cognizance of the offence punishable under the Act by the Court not inferior to that of a Magistrate of the first class, who shall try any such offence. 15. Sri Ravi Kant, learned Senior Counsel laid emphasis that a cold storage cannot run without a licence being gra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agricultural commodity and also the maintenance of the necessary records for regulating the storage of such commodity. 19. In the present case, learned Counsel for the Revenue has mainly relied upon the two deletion made by the ITAT of the addition so made by the AO as confirmed by the CIT (A). As to the addition made of Rs. 37,30,710/-, which is lesser cash in hand as compared with the books of accounts in which the assess has shown more cash in hand, the Tribunal held that it is neither a case under Section 68 of the IT Act nor Section 69-A of the Income Tax Act. The Tribunal further went on to hold that it was not a case where money is not recorded in the books of account of assessee, and in the present case cash in hand in the book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee, Cold Storage of the provisions of the U.P. Regulation of Cold Storage Act. Once it is established that the assessee did not violate any terms of provisions of U.P. Regulation of Cold Storage Act, 1976, then, the finding recorded by by AO as well as the first appellate authority that the assessee was in the business of potatoes and the addition so made by the Assessing Officer was merely on the basis of presumption and assumption and without any material on record. 23. The Tribunal has also recorded a categorical finding that no evidence of purchase, sales or unaccounted stock belonging to the assessee during the course of search or survey was found or established, thus, there was no justification for the authorities to make or confirm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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