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2016 (9) TMI 1544 - ITAT AMRITSARValuation of closing stock - Survey u/s 133A - Difference between the value of stock arrived at by survey team and that of value calculated by assessee on the basis of Trading Account as on the date of survey by applying G.P. rate of previous year - HELD THAT:- Assessee is in the business of Cloth and Garments and its qualities are numerous and it is also a fact that the prices mentioned on the Slips attached on such cloths does not necessarily realize the same value as during bargaining the business man has to give some discount, therefore, the valuation by survey team at highest prices was not justified. AO has not made out a case that assessee had not been valuing its stock at sale prices as normally the stocks are valued at cost prices or market prices whichever is less. Therefore, valuation of inventory at the time of survey at sale prices is not at all justified. The assessee had submitted that the gross profit ratio earned by it for the last five years and has also filed the gross profit earned by assessee in the same trade by its competitors and had requested the AO to consider the gross profits of these firms also but AO did not consider the submissions and neither rebutted any of the submissions made by assessee - addition made by AO and further upheld by CIT(A) is not justified specifically in view of the fact that they did not find any discrepancy in the books of account nor the books of account were rejected. In view of the above, the grievance of the assessee is justified and we delete the addition. - Decided in favour of assessee
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