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2021 (12) TMI 159 - AT - Income TaxUnexplained investment in stock and gross profit thereon - as in search and seizure proceedings, certain loose papers in the form of Consignment memos, issued for the exhibition purpose which was in turn for the purpose of insurance, were seized by the Revenue - AO had compared these consignment memos with value of stock as per books and difference arising on such comparison was then added as unexplained investment in stock u/s 69 - Whether addition made is not based on any tangible evidence and is totally based on loose paper seized by the Revenue in the form of consignment memo for Exhibition Purpose? - HELD THAT:- There are no corroborative evidences in the hands of Revenue to substantiate the allegations of unaccounted purchase. During search proceedings there were no evidences found in the form of unaccounted purchase bills or unaccounted sales or list of suppliers from whom unaccounted purchases made or payments made for such alleged unaccounted purchase etc. In the absence of such corroborative evidence, the loose paper seized (Consignment Memo) is nothing but a dumb document and do not possess any evidentiary value in the eyes of Law. If the assessee would be doing transactions of such high magnitude of unaccounted purchase/sales, the same would have been easily corroborated through aforesaid tangible evidences. But the Revenue couldn't bring such evidences even on account of extensive search undertaken because no such transactions were conducted by the assessee. Therefore, we are of the view that the addition made on the basis of overvalued stock in Consignment memos prepared for getting Insurance claims requires to be deleted as books of accounts found were found genuine and no corroborative evidence were brought on record. We are of the view that the ld. CIT(A) has rightly appreciated the facts and reached to the justified conclusion in the light of the relevant judicial pronouncements. Even before us, the Revenue could not controvert the findings of the ld. CIT(A) by bringing any tangible or contrary evidence on record. Therefore, we confirm the findings recorded by the ld. CIT(A) on this issue. Accordingly, ground nos. 1 & 2 raised by the Revenue are dismissed. Addition being @25% Travelling expenses & conveyance expenses - AO made this addition @25% on account of personal use and ld. CIT(A) restricted the same to 10% on the ground that disallowance of expenses is on higher side - HELD THAT:- On consideration of facts, we are of the view that such expenses are incurred for the business purpose. Since the addition is made by the Assessing Officer on estimation, the ld. CIT(A) is justified in restricting the same to 10%. Thus, we do not find any reason to interfere with the finding of the ld. CIT(A) on this issue. Accordingly, ground no.3 raised by the Revenue is also dismissed.
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