1997 PLP (Trib (PTD)

Date of Sale Amount 26-11-19881 Rs.80,360 22-11-1988, Rs.2,21,168 The details of sales reveal that you have not disclosed the sales which were made to M/s. Orient Oxident (Pvt.) Limited and Al-Din Rice Mills (Pvt.) Limited through M/s. Anwar Corporation Muridke during the period relevant to assessment year 1990-91 which amounts to concealment and furnishing of inaccurate particulars of your income. In his reply dated 22-3-1992, appellant specifically denied having made any sale to M/s. Orient Oxident (Pvt.) Limited and Al-Din Rice Mills (Pvt.) Limited and contended that the sales to M/s. Anwar Corporation Limited in the show-cause notice had been made out of the opening stock of Rs.15,15,178 and thus there had been no concealment of income. This explanation was found to be unsatisfactory on the ground that appellant had not declared analysis of the opening stock. The I.T.O. vide his letter dated 7-6-1993 further observed:-- "In addition to above you yourself mentioned in the balance sheet as at 31-8-1989 stock of Rs.12,53,175 as previous stock. If this amount is deducted from closing stock for the assessment year 1989 90 of Rs.15,15,178 the balance amount would come to Rs.2,62,003 and not the sales of Rs.3,01,

528. Thus, it is established that you suppressed the sales to the tune of Rs. 3,01,528 which intend to add in your assessed income. " In reply to this notice the appellant vide his letter dated 14-6-1993 reiterated that out of the opening stock of Rs.15,15,178 sales to the tune of Rs.2,98,395 had been made by the appellant to M/s. Anwar Corporation who in turn might have sold the same to M/s. Orient Oxident (Pvt.) Limited and A1 Din for Rs.3,01,528 and, thus, nothing had been suppressed. After rejecting the above explanation the amount of Rs.3,01,528 was deemed as income under section 13(1)(c).

4. Appellant's contention that the cogent explanation had been rejected without justification appears to be correct. Profit and loss statement for the year under appeal included an amount of Rs. 4,351 as loss under the head stock Khatha. " The copy of the stock Khatha was produced to show that opening balance of Rs.15,15,178 had been disposed of for Rs.15,11,025 and the loss of Rs.4,351 had been taken to the P & L account Copy of the ledger account of M/s. Anwar Corporation was also produced wherein sales of Rs. 2,98,393 were shown to have been made to the said member in October 1988 against which payments of Rs.20,000, Rs. 15,000, Rs.50,000, Rs.8,000 and Rs.70,395 were shown to have been received on various dates. Thus explanation dated 22-3-1992 which regularly backed us by entries recorded in the books during the course of business was rejected without any justification. The assumption that appellant made any sale to M/s. Orient Oxidant (Pvt.) Limited and Al Din Rice Mills Limited was not supported by any material. I.T.O' s. assumption that the position of opening and closing stock left a chance of sales to the tune of Rs.2,62,003 as against Rs.3,01,528 was totally misconceived. The sales out of the opening stock of Rs.15,15,178 had been separately recorded in the account books while the closing stock of Rs.12,53,175 was left over of the purchases made during the year. Thus, the facts on record did not justify proceedings under section

65. The order under section 62/65 in respect of assessment year 1990-91 is, therefore, annulled. C.M.S./316/Trib Order accordingly.