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2012 (5) TMI 458 - AT - Income TaxAddition of Rs.47,72,525/- u/s 69C as unexplained stock - During the course of assessment proceedings the assessee was asked to submit item wise and month wise quantitative details of raw materials as well as sale of finished products - On verification of books of accounts of the assessee and the details as produced before the AO, it was observed that the assessee was maintaining detailed record of purchases, sales and issue of these goods for mixing/preparation of other spices but not produced the same before him - According to the AO, the assessee had showed negative stock and the assessee was asked to explain the negative stock and also why the discrepancy should not be treated as unexplained expenditure incurred by the assessee on purchase of hing - learned DR relied upon the orders of the authorities below and submitted that the assessee has failed to explain the discrepancies in hing account and there was negative balance in the stock on certain dates - Held that: instead of making huge addition against the assessee, it could be reasonable and proper for the AO to reject the book results of the assessee and to make reasonable addition considering the history of the assessee The stock during the course of the proceedings was found to be negative, therefore, it could be presumed that the same was sold outside the books of accounts - The assessee deals in several varieties of the items and as such it would be difficult to maintain details of the stock. The assessee produced all the books of accounts and sales and purchases vouchers before the AO for verification - Decided in favor of the assessee by way of addition of Rs.47,72.525/- is restricted to Rs.3,00,000
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