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2018 (11) TMI 252 - AT - Income TaxUndisclosed investment addition - stock discrepancy addition - alleged discrepancies found in paddy stock during the course of survey - gross profit estimation @ 8.92% - Held that:- The assessee reiterates his stand adopted throughout that the impugned addition is not based upon any material fund during the course of survey since both the lower authorities have gone by the alleged survey statement only which is against CBDT’s circular dated 10.03.2003. We find no merit in either of these two submissions. It has come on record that both the lower authorities have made the former addition based on physical verification to assessee’s paddy stock during the course of survey there on mere statement recorded therein or with reference to any vague evidence. We thus find no reason to delete the impugned addition in principle. Now comes the equally important question as to whether the entire discrepancy in stock addition or only the profit element embedded therein is to be considered for the impugned addition. We find this issue to be no more res integra as co-ordinate bench of this tribunal in M/s Subarna Rice Mill vs. ITO [2015 (7) TMI 522 - ITAT KOLKATA] holding only the profit element liability to be added in such circumstances; stand upheld by hon'ble jurisdictional high court’s recent judgment [2018 (8) TMI 1475 - CALCUTTA HIGH COURT]. We therefore conclude that the impugned former addition of the entire discrepancy in stock deserves to be deleted.
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