A.R.LAKSHMANAN, J. - (1.) HEARD Shri Sandeep Bhandawat for the appellant.
(2.) THIS appeal under S. 260A of the IT Act, 1961 ('the Act') has been filed to set aside the decision of the Tribunal and restoring the order of the assessing authority. The assessee is a wine contractor. During the Course of assessment proceedings, the assessee had produced cash book, ledger, purchase vouchers, sale register, etc. The AO had invoked the provisions of S. 145(2) of the Act since the assessee had not produced the sale vouchers and made trading addition of Rs. 4,13,077 in the country liquor business by applying the net profit rate of 25 per cent on total outgoing of Rs. 2,06,83,435 determining the net profit at Rs. 51,70,859 as against Rs. 47,57,782 shown by the assessee. Similar order was passed in IMFL business also. The assessee preferred an appeal before the CIT(A), who by order dt. 25th March, 1999 allowed the appeal while confirming the order of the AO. Both the assessee as well as the Revenue preferred appeals before the Tribunal being aggrieved with the order of the CIT(A). The Tribunal vide its present order dismissed the Revenue's appeal and partly allowed the assessee's appeal and reduced the total additions of Rs. 24,13,077 to Rs. 2 lakhs and observed that in the assessee's own case, in the immediate preceding year there was a total addition of Rs. 1,50,000. The Department aggrieved with this order, preferred the present appeal.
(3.) SHRI Sandeep Bhandawat, the learned counsel for the Department, submits that the Tribunal has erred in law in not appreciating the fact that the additions of the disallowances were made by the AO because the assessee had not produced the sale vouchers and its sales were not verifiable. He further submitted that expenses were also not supported by authentic vouchers and due to these defects the AO had invoked the provisions of S. 145(2).;