R.P. GARG, VICE PRESIDENT This appeal by assessee is against order of CIT(A) for assessment for block period from 1st April, 1 9 8 9 to 7th Dec., 1 999 . 2. Ground No. 1 raised by assessee for upholding decision of AO in respect of passing of order under s. 158BC is not pressed by assessee, same is dismissed. 3. only ground remains in this appeal for our consideration is as under : "2. Confirming estimation originally made by AO in respect of so-called undisclosed income at Rs. 16,53,747 which was made merely on conjecture and surmises and without appreciating totality of case, citations of various Courts and Tribunals and submissions made by company in this regard." 4 . assessee is engaged in business of ship-breaking. During year under consideration, it had shown sale proceeds in respect of three parties, details of which are given hereunder : Buyer Chq. Sl. party as per DD/cheque Sale F.Y. Recd. in Amount No. record of purchased by consideration F.Y assessee Moyash 1 99 Pharma Rushil Ind. 1 99 16,52,580 1. 31,02,580 8- 99 & 1 Machine Ltd., Ltd. 8- 99 15,00,000 999 -2000 Mumbai Royal Royal 1 99 1 99 15,00,000 2. Enterprises, Enterprises, 58,72,400 8- 99 & 1 8- 99 43,72,400 Mumbai Mumbai 999 -2000 Shital Royal 2000- 1 3. Mktg., Enterprises, 20,00,000 20,00,000 01 999 -2000 Ahmedabad Mumbai 5. ITO made inquiries and found sales as not proved and sale proceeds have been routed through one Madhupuri Group. According to him, none of three concerns to whom sales was made were genuine concern and sale and transportation of goods have not taken place. After detailed discussion, he held that books of accounts of assessee were (sic-not) proper as assessee had shown sale of fictitious parties. He observed that it may be true that cheques/DDs are received by assessee against sale bills issued either before or in due course of time after receiving fund, it was duty of assessee to prove beyond doubt that sales have taken place against specific receipts is genuine. He, therefore, held that books of accounts of assessee are not correct and complete and, hence, provisions of s. 145(3) of Act were applicable. As sales have been made to fictitious parties, he opined that assessee had saved excise duty and sales-tax and there was possibility of income to extent of 25 per cent. As it was to be shared with purchaser, at least 15 per cent should have been earned by assessee. He, accordingly, made addition of Rs. 16,53,747 being 15 per cent of sale to aforesaid three parties to income of assessee. 6. CIT(A) confirmed order of AO by observing in para 6, held as under : "As regards quantum addition by way of estimating profit at 15 per cent on fictitious sales, it may be mentioned that I am in agreement with views of learned AO that only apparent reason for showing sales to fictitious persons is to suppress sale price and thereby net profit rate of 15 per cent applied by AO on such fictitious sales is reasonable, having regard to material on record, which is clearly brought out, by AO and for reasons given by AO in assessment order. Having regard to material on record, I am of considered view that AO s conclusions in this regard are reasonable and do not require any interference. Estimate of net profit of 15 per cent and consequent estimation of undisclosed income of Rs. 16,53,747 is upheld. It may also be mentioned that most respectfully, I differ with views of my learned predecessor who has allowed relief to similar point in some cases. In my view, fact that appellant is engaged in Hawala sales to parties in whose name sales have been booked, has escaped attention of learned predecessor. Such people who have no respect for law and engage in Hawala, have to face consequences and cannot be let off. Taking into account all these facts, I am of view that this case requires tough response and accordingly addition made by AO is confirmed." 7. We have heard parties and considered rival submissions. These are proceedings under s. 158BC r/w s. 158BD of Act and, therefore, unless material is there on record for excess sale realized by assessee, no addition in income of assessee can be made. There is no material on record to suggest that assessee had realized more sale proceeds than what has been shown in books of accounts. cost of ship scrap worked out by assessee is less than Rs. 8,000 per M.T, whereas sale price to these parties is much more than amounts paid by Royal Enterprises, Shital Marketing and Moyash Pharma Machines Ltd. Sales bills and weigh-bridge receipts support sales to these parties. assessee s estimate of sale is ex-Alang i.e. parties come to site of assessee, they select goods and purchase and make payments to assessee. Thereafter, it is for buyer to lift goods and carry to its destination way they like. mere fact that payments have been routed through one Madhupuri Group may not be ground to suspect that assessee had received more sale price. Be that as it may, in absence of any material on record to suggest that assessee had received higher (amounts), addition under s. 158BC r/w s. 158BD cannot be made. CIT(A) was not justified in upholding any additions made by AO, as same are contrary to facts on record. Accordingly, additions are deleted. 8. In result, assessee s appeal stands allowed. *** RUSHIL INDUSTRIES LTD. v. DEPUTY COMMISSIONER OF INCOME TAX