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2017 (4) TMI 1057 - AT - Income TaxAdditions on account of stock shortage - Held that:- We find that the lower authorities have summarily rejected the stock reconciliation submitted by the assessee before the AO, as an afterthought without examining the merits of stock reconciliation provided by the assessee. We also find that the lower authorities have not given the reason for making the addition of the entire amount of alleged suppressed sales amounting to ₹ 1,52,538/- without explaining why the addition was not restricted to gross profit on the alleged suppressed sales. In the fitness of things, therefore, we set aside the order of the lower authorities on this issue and restore the matter to the file of the Ld. CIT(A) for fresh order on this issue. The Ld. CIT(A) is directed to examine the stock reconciliation furnished by the assessee on merits and to give a categorical finding. The Ld. CIT(A) is also directed to pass a speaking order giving categorical finding whether the entire amount of the alleged suppressed sales is to be added or only the gross profit earned on such alleged suppressed sales is to be added as assessee’s income. This issue is restored with the aforesaid directions to the file of the Ld. CIT(A) for fresh order as per law. Unexplained investments - loose paper on the basis of which this addition is made - Held that:- The assessee has filed a Paper Book before us containing 10 pages which includes the copy of the assessee’s reply filed before the AO and copy of assessee’s submissions filed to Ld.CIT(A). The order of Ld.CIT(A) is a non-speaking order and does not explain why the explanation/evidences furnished by the assessee before AO and before ld.CIT(A) have been rejected. The order of the Ld.CIT(A) is also silent on why he chose to consider the aforesaid amount of ₹ 4,53,500/- and not the aforesaid net amount of ₹ 3,73,500/-; and from perusal of the order of the Ld.CIT(A) there is no mention that any opportunity was given by him to the assessee for taking this step. In view of these facts and circumstances, we are of the view that the order of Ld.CIT(A) is a nonspeaking order and has been passed without giving reasonable opportunity to the assessee. In the fitness of things, therefore, we set aside the order of Ld.CIT(A) and restore this matter to the file of the Ld.CIT(A) for fresh orders on this issue. The Ld.CIT(A) is directed to pass a speaking order giving reasons for why the explanation/evidences furnished by the assessee before AO and before Ld.CIT(A) have been rejected and why he chose to consider the aforesaid amount of ₹ 4,53,500/- and not the aforesaid net amount of ₹ 3,73,500/-.
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