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2015 (7) TMI 1186 - HC - Income TaxAddition on account of the alleged excess stock found at the time of search - Held that:- The sister concern, namely ; M/s. Rajendra Prasad Narendra Kumar is closely related with the partners and there was common business of both the concerns and though the shops are at a distance but the distance between the two concerns is about 100 meters only. The claim that both the concerns being closely related, was proved on the basis of the material found during course of search that the assessee was newly constituted and M/s. Rajendra Prasad Narendra Kumar being an old concern, goods were being transferred from M/s. Rajendra Prasad Narendra Kumar and vice versa to the present assessee and during the course of search itself, the partners in question No. 6 specifically asserted that the stock of M/s. Rajendra Prasad Narendra Kumar is also vailable at the premises of M/s. N. G. Jewellers (assessee). It is also admitted that silver items to the extent of 15.5 kgs. pertaining to stock of M/s. Rajendra Prasad Narendra Kumar was lying at the residence of the partners of the assessee firm at the time of search and on the, same material, this was held to be explained. It has also come on record that stock to this extent was found short at the time of survey simultaneously held at the business premises of Rajendra Prasad Narendra Kumar. Thus, on the said fact that the items used to be exchanged between the two sister concerns and admittedly proved, in our view, this being essentially a finding of fact based on the material available on record, no substantial question of law can be said to arise out of this addition. Purchase of jewellery - During the course of the assessment proceedings, the assessee also furnished affidavits of the above persons where they asserted that they had purchased jewellery from the assessee and paid the amount subsequently and even they had confirmed that no amount was outstanding as on the date of search. It is a finding of fact that the Assessing Officer did not call upon the persons who had filed affidavits. It is also a finding of fact that the statements of two persons, namely ; Ghasi Ram and Karan Singh were later on recorded by the Assessing Officer wherein they stated that they had paid the amount prior to the search. When admittedly all these persons have been found to have purchased goods from the assessee and adequate material was placed by the assessee before the Assessing Officer, the Tribunal has analysed the material based on the finding of fact and in our view, this being essentially a finding of fact, no substantial question of law can be said to arise out of this addition as well.
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