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2018 (2) TMI 500 - AT - Income TaxExcess stock found at the premises of the assessee during the course of survey - Held that:- A perusal of inventory of stock would indicate that the stock statement was prepared after physical verification. The partners have put their signatures after verifying the correctness of the stock statement. The assessee is simply denying about the availability of excess physical stock at the time of survey. They are harping upon the purchase bills and sales bills and entries made in the stock register. It is pertinent to observe that the surveys and searches are the last resorts with the Revenue to verify the actual position on the spot. The allegation against the assessee(s) is that they were not accounting total purchases in their books. That is why excess physical stock was available on a particular day when the survey was carried out. These allegations cannot be refuted by merely just saying that the alleged calculation made at the time of survey is wrong. The survey team was not having power to get declaration as well as arrest the assessee. The partners should have not put their signatures on the inventory of stock prepared by the survey team. Now, with the help of simple denial, they cannot say that excess stock was not found.- Decided against assessee Addition u/s 40(a)(ia) - Held that:- Delhi High Court in the case of CIT Vs. Ansal Land Mark Township (P) Ltd [2015 (9) TMI 79 - DELHI HIGH COURT] if the recipients have paid the taxes on the receipts on which TDS was not deducted, then, no disallowance be made in the hands of payer with the help of Section 40(a)(ia) of the Act. On due consideration of this contention, we deem it appropriate to set aside this issue to the file of the Assessing Officer. The learned Assessing Officer shall verify as to whether M/s. Nirala Roadways has included ₹ 52,730/- in their taxable receipts and, if it was included, then, no disallowance to be made. We make it more specific that the Assessing Officer shall issue summons to M/s. Nirala Roadways for verifying this fact Penalty u/s 271(1)(c) - excess stock in search - Held that:- As discussed in the quantum appeal, was found at the premises of the assessee during the course of survey. The partners had put signatures on the inventory prepared by the survey team. That admission was never retracted. It failed to give any explanation about the source of excess stock. We have confirmed addition in the quantum appeal. In the penalty appeal, there is no explanation at the end of the assessee as to what prompted in the minds of the partners for not disclosing the excess stock admitted during the course of survey in the return of income. aking into consideration the above facts and circumstances of the case, we do not find any merits in this appeal. It is dismissed.
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