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2016 (7) TMI 399 - AT - Income TaxCalculation of Suppression of Purchase; Suppression of gross profit and Suppression of Stock - whether the ld. CIT(A) is justified in restricting the addition to ₹ 16,95,715.00? - Held that:- The withdrawal from the bank can be for several purposes and do not necessary represent the purchase. In this case the base taken by the AO to unearth the unaccounted purchase was not correct in our considered view. The AO has also not brought any defect in the stock register of the assessee but has relied on the balancing figure of the stock. Accordingly in our view the AO has made the addition without applying his mind for unearthing the disclosed income of the assessee. In view of the above, we find that the base adopted by AO for working out the suppressed purchase, gross profit and closing stock was not proper and therefore we find no reason to interfere in the order of Ld. CIT(A).- Decided against revenue Failure to consider the provision of Sec. 292C by CIT(A) - presumption - Held that:- We observe that Ld. CIT(A) has passed a speaking order and after considering the submission of assessee and taking the remand report from Assessing Officer. As per Sec.292C of the Act the documents seized at the premises of assessee are presumed belonging to assessee only and assessee has to justify about those documents. In this case, we find that Ld. CIT(A) has duly considered the justification given by assessee and accordingly he passed a speaking order. Hence, we find no infirmity in the order of Ld. CIT(A). - Decided against revenue Unreasonable extra capital invested in the unrecorded purchase - rotation of the capital in the business - Held that:- After considering the business and rotation of capital we are of the considered view to take the rotation cycle 15 times and accordingly work out the capital embodied in the disclosed purchase for ₹ 3,60,220/- (Rs. 54,03,311 / 15 times). This ground of assessee’s CO is allowed - Decided against revenue
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