- (1.) This is an appeal under Section 260 A of the Income Tax Act, 1961 (hereinafter referred to as the ("Act") arising from the order of the Tribunal dated 21.7.2004 in which following questions have been raised:- 1-Whether on facts and in the circumstances of the case the Income Tax Appellate Tribunal was correct in law not upholding the order of the assessing officer wherein the addition on account of under invoiced sales of Kattha amounting to Rs.1,24,300/- was made on the basis of material in the shape of loose papers found and seized by the department at the time of search? 2-Whether on facts and circumstances of the case, the Income Tax Appellate Tribunal was correct in deleting the addition made by A.O. on account of unexplained investment in plant & machinery and factory building amounting to Rs.1,01,345/- and Rs.3,77,982/- respectively, observing that no documents in this regard was found during the course of search ignoring the finding and observation of the Assessing Officer that information leading to undisclosed investment was very much in his possession? 3-Whether on the facts and circumstances of the case the Income Tax Appellate Tribunal was correct in deleting the additions made by the A.O. on account of unexplained investment in plant & machinery and factory building amounting to Rs.1,01,345/- and Rs.3,77,982/- respectively relying on the Hon'ble Supreme Court's decision in the case of Smt. Amiya Paul reported in 262 ITR 407, ignoring the amended provisions of Section 142 A in this regard which were applicable with retrospective effect?
(2.) The respondent is a Company incorporated under the Indian Companies Act and was carrying on the business of manufacture of Kattha. A search was made at the business premises of the petitioner on 17/18.10.1995 wherein certain documents were seized. The Assessing Authority by the impugned order dated 30.10.1996 passed block assessment for the periods 1.4.1985 to 17.10.1995.
(3.) The Assessing Authority on the basis of the rate difference in the purchases of Khairwood for the financial years 1994-95 and 1995-96 has made an addition of Rs.1,24,300/- for the assessment year 1993-94 as an undisclosed income. The Assessing Officer has observed that sale of Kattha began on 12.3.1994 till 31.3.1995. The assessee sold 2500 kgs Kattha. As per books, the assessee sold Kattha of Rs.9,93,500/- while as per the rates in the seized papers the value of this Kattha is Rs.11,17,800/-. Thus, the difference of under invoicing was determined at Rs.1,24,300/- and the undisclosed income was assessed. The Tribunal has deleted the addition on the ground that during the course of search and seizure operation, no documents relating to any sale for the financial year 1993-94 was found.;