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2021 (5) TMI 19 - AT - Income TaxExcess stock found during survey - AO made addition and also the Gross-Profit (GP) on it - HELD THAT:- Having regard to the working statement of the survey team it cannot be denied that the survey team had physically found stock having selling value of ₹ 1,43,00,000/-. Applying the GP rate of 6.74%, the cost price of such stock works out to Rs, 1,33,97,040/-. As noted earlier, and also at Para 3 of the assessment order, the stock available in the books as on the date of survey was ₹ 1,10,80,923/-. Giving the benefit of the dead stock of ₹ 8,79,415/-, as allowed by the AO at Para 5 of the impugned order, the discrepancy in the stock works out to ₹ 14,36,702/-[₹ 1,33,97,040 - ₹ 1,10,80,923 - ₹ 8,79,415]. Considering the aforesaid facts and circumstances, we are of the view that the value of excess physical stock found in the course of survey can be reasonably estimated at ₹ 14,36,702/- and G.P rate of 6.74% on it are sustained (BOTH). The CO of the assessee is partly allowed to this extent.
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