JUDGMENT

Ritu Bahri, J.

The present appeal has been filed under Section 260-A of the INCOME TAX ACT , 1961 (for short 'Act 1961') seeking setting aside of order dated 28.03.2013 (A-3) passed by Income Tax Appellate Tribunal, Chandigarh Bench 'E' passed in ITA-158/Del/2012 dated 22.02.2013 for the assessment year 2008-2009.

2. The case in brief is that the appellant is engaged in business of manufacturing and trading of Rice and trading of paddy. The assessee/appellant filed the return of income on 06.10.2008 (A-1) at an amount of Rs.10,32,186/-, which was processed and proceedings under Section 143 (2) of Act 1961 were conducted. The assessment was completed under Section 143 (3) for the assessment year 2007-2008 on 07.09.2009 (A-2). On 29.11.2010, the proceedings were completed and addition of Rs.1,01,016/- was made and keeping in view the provisions of Section 40 (a) (ia) of the Act 1961 payment of Rs.1,01,016/- made to Satake India Engg (P) Ltd on account of AMC was disallowed. Further Rs.56,650/- incurred on purchase of UPS held to be capitalized and depreciation was ordered to be charged on it. Rs.7650/- were added to the income of the assessee on account of telephone expenses, as the assessee admitted the expenditure incurred on account of telephones installed at residences. Further addition of Rs.2,00,000/- was made on account of sale of rice, as no stock was maintained by the assessee quality wise and quality of different quality of rice produce from milling of paddy could not be ascertained. Rs.6236/- were added on account of foreign travelling expenses. The details of computation of income are given below:-

3. The appellant preferred appeal against order 29.11.2010 before Commissioner of Income Tax (Appeals) Karnal, which was dismissed on 01.11.2021 and against this order, the appellant preferred appeal before Appellate Tribunal, which was also dismissed on 22.02.2023. Hence the present appeal.

4. At the very outset, learned counsel for the Appellant is relying upon Division Bench judgment of this Court in a case of ITA No. 615-2008 titled as Inderjit Mehta Construction (P) Ltd v. Addl. Commissioner of Income Tax, Bathinda, decided on 06.08.2013 wherein following substantial question law were answere in favour of the appellant:-

"(ii) Whether the ld ITAT is justified to interfere in the well reasoned findings given by the 1st Appellate Authority to the effect that there is no valid ground to disallow the expenditure of Rs.3 lacs out of Rs.3.50 lacs claimed by the assessee, from the total receipts made by it, in contract receipts?

(iii) Whether on the facts and circumstances of the cases, there are any basis for making any addition of Rs.2,50,000/- in the total income of the assessee by disallowing expenditure, on surmises and conjenctures without finding any discrepancy in Audited books of account?"

5. While allowed the appeals, it has been observed that all the three authorities had acted on surmises and guess work while sustaining the additions of different amounts. Further the authorities were required to have some material to come to the conclusion that the addition was required in the case and not just because the case was selected for scrutiny that the addition was to be made. No justification have been pointed out by learned counsel for the r