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2024 (1) TMI 418 - AT - Income TaxHigher rate of tax u/s 115BBE - Unexplained investment in stock - difference in valuation of stock found during the course of survey conducted u/s. 133A - Addition u/s. 69B - higher rate of tax applied invoking the provisions of section 115BBE - HELD THAT:- As decided in Overseas Leather [2023 (4) TMI 1207 - ITAT CHENNAI] wherein when the assessee has explained that the source was from the business and except stock difference, no other investment with any other asset was found and particularly, this unexplained investment is surrendered as ‘business income’, in the absence of any other finding, the same has to be assessed as ‘business income’ and not under the head ‘unexplained investment’ u/s. 69B As noted that the assessee has declared additional income towards excess stock found during the course of survey and assessee has explained the source for excess stock found during the course of survey i.e., that it was out of income earned from current year business or earlier years business and surrendered the amount, the AO has not done anything to dispute the claim of assessee that the source was not from the business income. Hence, the AO cannot apply the provisions of section 115BBE - assessee also admitted the difference as income, which is not disputed but has to be taxed as ‘normal business income’ and not as ‘unexplained investment’ u/s. 69B of the Act. Accordingly, we allow the grounds of appeal of assessee.
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