- (1.) Heard Sri Praveen Kumar, learned Counsel for the department and Sri Vibhu Rai, Advocate holding brief of Sri Anoop Trivedi, learned Counsel for the assessee.
(2.) This is an appeal filed by the department under Section 260A of the Income Tax Act, 1961 for the Assessment Year 2007-08 against the order of the Tribunal dated 18.12.2015. The questions of law sought to be answered are hereunder :- "(A) Whether in the facts and circumstances of the case, the learned ITAT was justified in law by upholding the addition of Rs.1,31,00,000/- made by the Assessing Officer but simultaneously allowing exemption under Section 10A to the assessee on additional income surrendered by the assessee during the course of survey proceedings ? (B) Whether in facts and circumstances of the case, the learned ITAT was justified in law by without considering the fact that the impugned stock was kept outside books, as it cannot be denied that bringing it into books; would have meant an increase closing stock and an increased income, all of which would not eligible for exemption under Section 10A because such deemed increased income was apparently out of domestic operations and not out of exports ? (C) Whether in facts and circumstances of the case, the learned ITAT was justified in law by without considering the facts that this is not a case of mere omission from books of account but actually the assessee is not maintaining any records of recovery of wastage, despite such recovery is done on regular basis being an integral process of manufacturing ? (D) Whether in facts and circumstances of the case, the learned ITAT was justified in law without considering the facts that the accumulated gold on account of manufacturing process was neber accounted for in the books of account which has been produced during the course of assessment proceedings ?"
(3.) The facts of the case as stated by the department are that the assessee deals in manufacturing and sales of jewellery. The return of income of Rs. Nill had been filed on 29.10.2007 after claiming? the exemption u/s 10A of the Income Tax Act, 1961 (herein after referred as? the 'Act'). The case of the assessee was selected for scrutiny and, thereafter, a notice under Sections 143 (2) and 142 (1) along with questionnaire was issued. Compliance had been made by the Chartered Accountant.;