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2015 (4) TMI 1 - AT - Income TaxExcess stock valuation - CIT(A) deleted the addition - Held that:- a clear finding has been given by CIT(A) that physical removal from stacks and weighment in respect of approximately 1,00,000 bags of agricultural products was not possible in such time frame. He has further noted that the assessee on the very next day of survey had given an affidavit of the incorrect taking of stocks by the department and retraction as to the surrender which was done under pressure. He has also noted that the Assessing Officer has also not commented upon or controverted or tried to examine the arguments and affidavits which were also placed before him during the assessment proceedings. We have seen that before us also, in spite of providing several opportunities, the survey folder and assessment folder were not produced before us by learned DR of the revenue. Without carrying out actual weighment, how the stock inventory can be prepared when the bags were not having uniform weight. Considering all these facts, we do not find any reason to interfere in the order of CIT(A) on this issue. - Decided against revenue. Rejection of books of accounts - CIT(A) accepting the books reliable - Held that:- a clear finding has been given by CIT(A) that mistake pointed out by the Assessing Officer in the assessment order regarding some mistakes noted for recording of vouchers etc. cannot lead to the rejection of the entire accounts because no mistake has been pointed out by the Assessing Officer in the books of account maintained by the assessee. He has also given a finding that the assessee has brought on record, the assessment order in Sales Tax proceedings and the Assessing Officer could not point out any specific amount of sales not accounted for or purchases not accounted for. He has also given a finding that the Assessing Officer could not point out any purchase or sales which is sham. None of these findings could be controverted by Learned D.R. of the Revenue and we also find that in the present year, the assessee has reported a gross profit of 12.84% as against 12.62% in assessment year 2004-05 and 11.66% in assessment year 2003- 04. Hence, it is seen that the gross profit rate reported by the assessee is also higher than the preceding two years. Considering all these facts, we are of the considered opinion that no interference is called for in the order of CIT(A) on this issue also.- Decided against revenue. Negative cash found - CIT(A) deleted the addition - Held that:- the basis of the decision of CIT(A) is that as per a letter submitted by a computer expert on 14.3.2005 after the date of survey on 9.3.2005, it was stated that the software program was corrupt and incorrect. He has also noted that sales as per this trial balance were ₹ 6,34,57,711/- only whereas the sales as on that date as per regular books of accounts were ₹ 17,35,36,988/-. This goes to show that there is ample force in this contention of the assessee that the software program was corrupt because if the software program was not corrupt then how the sales as per this trial balance can be so much lower as compared to sales reported by the assessee as per its books of account. These findings of CIT(A) could not be controverted - Decided against revenue. Deduction under section 80IB - CIT(A) allowed the claim - Held that:- A clear finding is given by him that this issue is covered in favour of the assessee by the Tribunal order in assessee’s own case for assessment year 2003-04. - Decided against revenue. Addition u/s 68 - CIT(A) deleted addition - Held that:- CIT(A) that in all the earlier years and subsequent years, the advance of customers as reported by the assessee were accepted by the Assessing Officer in the assessment order framed u/s 143(3) of the Act. In the present year also, the Assessing Officer has accepted this practice and out of total amount of ₹ 55.37 lac, he has made addition of ₹ 19.70 lac for which advances were received in cash but he has accepted the balance amount of ₹ 35.67 lac for which advances were received through cheque. In our considered opinion, only because the advances were received in cash, it cannot be said that the advances are not genuine. The assessee has submitted all the confirmations but the Assessing Officer had not verified the same. This is also noted by him that the sales against these advances were made in subsequent years and the same was accepted as genuine. Considering these facts, we are of the considered opinion that no interference is called for in the order of CIT(A) - Decided against revenue.
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