TMI Blog2022 (7) TMI 1081X X X X Extracts X X X X X X X X Extracts X X X X ..... to be considered as income and not the entire unrecorded receipts. Accordingly, appeal of the revenue on these grounds is dismissed. Appellant company has offered undisclosed income earned out of unaccounted toll business - CIT(A) has estimated the unrecorded profit @ 8% on unrecorded receipts - On careful consideration of the argument of ld. AR and order of ld. CIT(A) it is seen that the appellant is in business of toll collection and during the course of search evidence of under recording of toll collection was admittedly found. The appellant has offered net profit of Rs. 14 crores in its return filed in response to notice u/s 153A and has stated it is earned out of its under recorded toll collection business. CIT(A) has rightly estimated the income from such unrecorded toll collection receipt @ 8% of the unrecorded receipts. However, there is no merit in the finding of the ld. CIT(A) that this amount is to be added separately and no benefit of telescoping is to be given. It is seen by us that when the appellant has itself offered Rs. 14 crores as income from such unrecorded receipts which is quite more than the estimation of profit so made by ld. CIT(A), therefore separ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se, the ld. CIT(A) has grossly erred in confirming addition of Rs.3,14,08,494/- by applying estimated rate of 8% on alleged undisclosed Toll Receipts of Rs.39.26 crores arbitrarily. 1.1 That the ld.CIT(A) has further erred in confirming the impugned addition by applying profit rate of 8% when the assessee itself has declared NP of 14.00 crores on such undisclosed toll receipts, thus it tantamount to double taxation of the same. Therefore, the addition so confirmed by ld. CIT(A) on the very same papers deserves to be deleted. ITA No.630/JP/2019 - Revenue 1. Whether on the facts and in the circumstances of the case and in law the ld. CIT(A) is justified in deleting the addition of Rs.22,11,97,623/- made by AO on account of undisclosed toll receipts as per seized documents. 2. Whether on the facts and in the circumstances of the case and in law the ld. CIT(A) is justified in considering only G.P. Rate while the entire amount of toll receipts were unaccounted. 3. Whether on the facts and in the circumstances of the case and in law the ld. CIT(A) is justified in directing the revised return of assessee for this year wherein the income was reduced by Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g evidence of unrecorded expenses allegedly not available in the seized document as indirectly referred by the AO, it was submitted that in fact even the details of dayto- day receipts of various naka were available only for the period from 02.07.2013 to 15.07.2013 as per exhibitsavailable in the paper pages 35 to 48. For this very period, the details of expenses are also evidenced on these pages. Accordingly, evidences of receipts as well as expenses both are clearly appearing and visible in these pages for the aforesaid period on day-to-day basis. For the remaining period, no record of day-to-day toll receipts of different specific toll naka and simultaneously also no record for expenditure incurred was seized. However, it is only the summary sheet of the receipts of the various months which were seized by the authorized officers and at that time corresponding details of expenditure were not seized. Merely because of these circumstances, it cannot be said that no expenditure was incurred for earning these unrecorded receipts. Considering the various decisions cited by the ld. AR and facts as well as circumstances of the case, the ld. CIT(A) held that unrecorded receipts cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent toll naka were available for this period. It was further stated by the ld. AR that neither any details of day-to-day toll collection receipts of the various centres were available for entire year nor such details of the expenses were part of the seizure. However, in respect of toll receipts, summary sheet of the various months were taken as part of the seizure, whereas expenses for these periods were not part of the seizure and merely because such expenses were not taken as part of the seized document, it cannot be said that no expenses were incurred on earning the unrecorded receipts. Accordingly ld. AR argued that finding of the ld. CIT(A) is correct to the extent that unrecorded receipts cannot be directly added as unrecorded income and it is only the profit element embedded therein which need to be considered. 5. On the other hand, the ld. DR contended that the books of accounts of the assessee were duly audited and assessee has failed to demonstrate as to which of the expenses found recorded in the seized documents and were not recorded in the books of accounts nor any such details were produced before the AO therefore action of the AO in making addition of the entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is out of under recorded toll collection business. It was submitted that ld. CIT(A) has failed to appreciate the fact that such income is the net profit earned out of under recorded toll collection business thus no further addition could be made more particularly when the ld. CIT(A) also not estimated the income more than the amount of profit declared by the assessee on such undisclosed toll receipts. On careful consideration of the argument of ld. AR and order of ld. CIT(A) it is seen that the appellant is in business of toll collection and during the course of search evidence of under recording of toll collection was admittedly found. The appellant has offered net profit of Rs. 14 crores in its return filed in response to notice u/s 153A and has stated it is earned out of its under recorded toll collection business. The ld. CIT(A) has rightly estimated the income from such unrecorded toll collection receipt @ 8% of the unrecorded receipts at Rs. 3,14,08,494/-. However, there is no merit in the finding of the ld. CIT(A) that this amount is to be added separately and no benefit of telescoping is to be given. It is seen by us that when the appellant has itself offered Rs. 14 crore ..... X X X X Extracts X X X X X X X X Extracts X X X X
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