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2009 (6) TMI 650 - AT - Income TaxAddition - undisclosed advance and unexplained stock - It was contended that addition has been made by the AO only on the basis of presumption and as against that the assessee has submitted the proof which was in the shape of books of account and has also produced the person to whom the payments were made and, thus, there was no justification in making the addition simply on the basis of presumption Regarding addition of Rs. 1 lac - AO has reconciled such stock which, according to him, tallied with the vouchers found except few items which are for a consolidated sum of Rs. 21,334 - Held that: learned JM was right in holding that the assessing authority should compute the closing stock of the assessee on the basis of 25 per cent variable. Regarding penalty - the fate of additions has to be decided in accordance with my above order and it will be in the interest of justice if the parties are given opportunity to argue this issue after the finalization of the quantum - if it thinks proper can dispose of penalty appeal by giving hearing to the parties on the date when the effect is, given to this order with regard to quantum proceedings - Appeal is partly allowed
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