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2010 (11) TMI 632 - AT - Income TaxReassessment - Addition - It was found that there was understatement of stock of 87191 bags of sugar as the quantity of stock pledged with the bank was in excess of what appeared in the books of account of the assessee - the company's entire closing stock is reconciled with the Excise Records which is verified, confirmed and certified by the Excise Officials from time to time - Since the quantity of sugar manufactured and sold during the year is not in doubt, if there is any difference arising in the closing stock then it automatically originates from the opening stock of finished sugar - It is apparent that finished stock of sugar of the season 1996-97 to the tune of 84,258 Qtls. cannot exist as on 31.03.1999 and the Bank statements are wrong as confirmed by the Excise records duly verified, confirmed and certified by the Excise Inspector - Hence, it proves that the total non-existing stock of sugar of 87,191 Qtls. (84,258 + 2,933) as appearing in the Bank statement is wrong and cannot be relied upon for making any addition on the company - It is not a case of simple hypothecation where goods remain in the possession of the assessee. Therefore, the burden is on the assessee to prove that what was stated in the stock statement submitted to the bank was not correct and what is existing in the books is the real state of affairs - Held that: onus shall lie upon the assessee to prove as according to sworn statement submitted to bank, the assessee has submitted the quantity of stock on the strength of which it has drawn the money from the bank - Decided in favour of the assessee by way of remand to CIT(A)
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