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2015 (7) TMI 1167 - HC - Income TaxUnaccounted sales - variation in stock at the time of search - Tribunal has allowed the appeals on the ground that other than the papers seized by the Department, there was no direct or indirect documents to prove that the assessees indulged in unaccounted sales - Held that:- Appellate Authority while dealing with this aspect of the matter has come to the conclusion that it is not the case of the assessees that the entries recorded are untrue and they do not relate to the assessees and accordingly held that Section 292C would not come in aid of the Department to draw an inference that all entries relate to sale. The Tribunal has further come to the conclusion that there is nothing in the seized material to show that unaccounted sales were found in the course of search. This finding of the ITAT is factually incorrect. As observed supra, the Assessing Authority has referred to the sale invoices to an extent of ₹ 5,40,765/- and deducted the said amount as can be gathered form para 6.17 of the assessment order. The order of the Assessing Authority is cogent and well reasoned. Every minute detail is reflecting in the said order. In a case of search of seizure, the revenue may discover assessees’ failure to account several transactions which ought to have been brought to tax. It is only in such circumstances that the provisions of search and seizure are invoked. Assessee took a definite stand that the entries found in the loose sheets were reflecting in the regular books. The assessees were given a fair and reasonable opportunity to substantiate their stand. Both the assessee and the chartered accountant failed to substantiate the same. There is no doubt with regard to the possession of documents in question. It is clearly recorded in the order of assessment that the partner S.Rudramuniyappa and the Chartered Accountant who accompanied him miserably failed to substantiate their claim. On facts, we are convinced that there is no dispute with regard to the seizure of documents and the assessee as well as the Chartered Accountant were given sufficient opportunity to substantiate their claim but they miserably failed justify their stand.The substantial questions of law raised in these appeals are answered in favour of the revenue.
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