ORDER ASHFAQ ahmed, accountant member.- These are three appeals in all. The department and the assessee are in cross appeals for the assessment year 1990-91 against the order passed by the CIT(A). Zone-I, Faisalabad, dated 9.8.1992. The third appeal has been filed by the department against the order of the CIT(A), Zone-Ill, Faisalabad, dated 21 10.1991 for the assessment year 1989- 90.
2. For the assessm ent year 1989-90 the department is aggrieved on account of deletion of additions made under the heads Kerosene/LDO account of Lubricants account. For the assessment year 1990-91 the department is aggrieved on account of deletion of addition made under the head commission on sale account and deletion of addition in miscellaneous income whereas the assessee is only aggrieved on account of the treatment meted out by the CIT(A) under the head tank lorry account.
3. Assessm ent year 1989-90: The assessee is a registered income which derived income from sale of petroleum products as a dealer of M/s. Pakistan State Oil. For the year under consideration the to had made round additions of Rs. 25,000/- and Rs. 30,000/- under the heads Kerosene and Lubricants account.
The assessee being aggrieved preferred an appeal before the CIT(A) who deleted the additions under both the parties the ground that these additions have been made without any solid basis and merely for the reason that the assessee had entered into an agreement for the previous year.
During the course of the hearing the learned D.R. Urged that as the assessee had entered into an agreement with the department for the previous assessment year, therefore, his declared version did not qualify for acceptance and the additions made by the assessing officer should not have been deleted by the CIT(A). On other hand, the learned A.R. Of the assessee asserted that the assessee has history of acceptance of account except for the previous assessment year wherein the agreed assessm ent was made. It was also submitted by the learned A.R. Of the assessee that in all the subsequent assessm ent year the assessee accounts have been accepted and as such the deletion made by the CIT(A) was perfectly in order and calls for no interference.
We have considered the arguments put forth by the learned authorized representatives of both the parties and find force in the contention advanced by the learned A.R. Of the assessee. The assessee is the dealer of M/s. Pakistan State Oil Company and is allowed a fixed rate of profit.
Merely by pointing out that the sales are unverifiable does not warrant rejection of accounts as the sale price in such cases is fixed by the principal and unless the department proves that the assessee has indulged in black marketing, no addition is sustainable under the law. The light of the above, the additions under both the heads of accounts were rightly deleted by the CIT(A) and the action of the CIT(A) is upheld. The departmental appeal in respect of the assessment year 1989-90 is, therefore, dismissed.
4. Assessm ent year 1990-91: The assessee and the department both are in appeal in this year. The deletion of additions by the CIT(A) made at Rs. 60,000/- and Rs. 30,000/- under the heads commission on sale of petroleum products and miscellaneous income respectively stand confirmed for the reasons have been discussed in the departmental appeal for the assessment year 1989-90.
The reduction allowed by the CIT(A) in the tank lorry account from Rs. 50,000/- to Rs. 20,000/- is also maintained. The assessee appeal for the assessment year 1990-91 wherein he is aggrieved on account of the reduction addition from Rs. 50,000/- to Rs. 20,000/-'from income from tank lorry account is rejected as it does not pertain to sale of products of M/s. Pakistan State Oil Company.
The to had made the addition due to fall in receipts as compared to the last year for which the assessee could not put forth a proper explanation. The CIT(A) has already reduced the addition from Rs. 50,000/- to Rs. 20,000/-. No further interference is called for in the order of the CIT(A) which is hereby confirmed. Both the cross-appeals are, therefore, dismissed.
5. As a result of the above discussion, all the three appeals are dismissed.