Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (8) TMI 815 - ITAT AHMEDABADSearch and seizure - Shortage of stock found during search and seizure - CIT deleted addition made by A.O. - Whether order made by CIT is without any basis - Held that:- CIT is giving the basis of his decision that the shortage of finished goods occurred only on account of non inclusion of unfinished jumbo reel/parent reel lying on the floor which was subsequently cut into small reels and entered into RG-1 register against production on 14.07.2009 and 15.07.2009. This basis given by CIT(A) in support of his decision is totally contrary to the facts. If some jumbo reels and parent reels lying on the floor on the date of search i.e. on 16.07.2009 were not included in the inventory of finished goods then how such non inclusion in the inventory of finished goods on the date of search can explain the finished goods as per RG-1 register on 16.07.2009. The basis of Ld. CIT(A) is this that from the inventory of goods, it is clear that inventory of unfinished reels on the floor was not taken in stock as on 16.07.2009. Even if it is correct, it is not relevant for the purpose of explaining the shortage in the stock of finished goods on the date of search because it is admitted position of fact that in the RG-1 register, only finished goods is entered as production and therefore, the search team was required to take stock of only finished goods for the purpose of comparing the available stock of finished goods as compared to book stock of finished goods. There is no basis of exclusion form opening stock of finished goods as on 16.07.2009 because the production on 14.07.2009 and 15.07.2009 is included in the RG-1 register and the same must be available with the assessee on the date of search i.e. 16.07.2009 in the form of finished goods and the same cannot be explained by availability of unfinished goods on the date of search. The exclusion on account of dispatch on 16.07.209 is also without any basis in the facts of the present case when there is no finding given by CIT(A) that such dispatch on 16.07.2009 is before the inventory taken by the search party. Generally, the search is carried in the morning hours and hence, any dispatch on the date of search cannot be before taking the inventory by the search party and in some cases, there can be such dispatch but then this has to be brought to the notice of the search party and evidence may be brought on record about the time of dispatch and the time of taking inventory by the search party and in the absence of any such evidence produced by the assessee, the reconciliation statement is not acceptable - There order of CIT is without any basis and reversed - Decided in favour of revenue.
|