IN THE ITAT CHANDIGARH BENCH ‘A’
Pawan Kumar v. ITO
IT APPEAL NOS. 1119 & 1145 (CHD.) OF 2011
[ASSESSMENT YEAR 2008-09]
MAY 17, 2012
ORDER
H.L. Karwa, Vice-President
These cross-appeals by the assessee and Revenue are directed against the order of CIT(A)-II, Ludhiana dated 20.9.2011 relating to assessment year 2008-09.
2. Ground Nos. 1 & 2 of the assessee’s appeal reads as under:-
1. That the Ld. CIT(A)-II, Ludhiana has erred in confirming the action of the Assessing Officer (Assessing Officer) in rejecting the books of account u/s 145(3) of the Income-tax Act, 1961.
2. That the Ld. CIT(A)-II, Ludhiana has erred in sustaining addition of Rs. 2 lacs out of addition of Rs. 8,68,000/- made by the Assessing Officer on account of so-called low yield of oil in cotton seed by adopting the yield at 11% on estimation by rejecting the books of accounts u/s 145(3) of the Act.
3. Ground No. 1 of the Revenue’s appeal reads as under:-
1. That the Ld. CIT(A)-II Ludhiana on facts as well as in law, has erred in reducing the addition made by the Assessing Officer on account of low yield of oil in cotton seed by holding that 192 qtls. Cotton seed oil sold outside his regular books of account maintained by the assessee from 8,68,800/-to Rs. 2,00,000/-.
4. The assessee is in appeal against the addition of Rs. 2 lakhs sustained by the CIT(A) and Revenue is in appeal against the order of CIT(A) in reducing the addition form Rs. 8,68,800/- to Rs. 2,00,000/-
5. Briefly stated, the facts of the case are that the assessee derives income from manufacture and sale of cattle feed, oils, oil cakes etc. From the perusal of the quantitative details filed with the Audit report, the Assessing Officer found that although the quantities of cotton seed, mustard and groundnut crushed during the previous year have been separately shown but the yield of oil and oil cakes have been given in consolidated form at 13.02% and 83.91% respectively. The Generation of gad is given at 1.74% and shortage claimed at 1.34%. The Assessing Officer vide notice dated 3.12.2010 asked the assessee to rework the yield of oil and oil cakes separately from different types of oil seeds crushed by him. The assessee was also asked to explain the reasons for mixing up the cotton, mustard and groundnut oil seeds in the same category, when he was aware of the fact that there was vast variation in market price of these types of oil seeds and their products. The assessee was asked to submit yield of oil obtained on the crushing of three types of oil seeds separately and which he has given as under:-
