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2020 (11) TMI 807 - AT - Income TaxDisallowing excess purchase price - Whether effect of such excess pricing had already been neutralized in the Profit & Loss A/c by way of enhancing the closing stock value of almost same value as observed in the assessment order also? - CIT-A deleted the addition - HELD THAT:- Fact which should not be lost sight of is that the quantity of purchases was tallying with the parties accounts vis-à-vis the appellant's books in this regard. The appellant made high sea purchases of raw cashews from Kerala Port and as per the Departmental of Commercial taxes, Kerala under the Kerala VAT Rules the price was of such import was fixed at ₹ 70/- per kg. This was also mentioned in the Circular No.28/11 dated 3.12.2011 issued by the Departmental of Commercial taxes, Kerala. The appellant irrespective of the prices of actual purchases as per the high seas agreement valued the raw cashews at 70/- per kg. under the State Rules, VAT and the Income Tax Rules and laws. It is in this manner that the appellant reflected the value of purchases of raw cashews in the audited accounts which resulted in excess value to the extent and the said fact has been properly appreciated by ld CIT(A). That being so, we decline to interfere with the order of ld. C.I T.(A) in deleting the aforesaid additions. Addition on account of two outstanding creditors as on the last day of financial year - HELD THAT:- In view of the fact that the purchases is not disturbed and tallying and the amount is receivable by the appellant from the party which the party has passed a journal entry and nullified the same in their books would not justify additions in the books of the appellant and therefore, the AO is directed to delete the additions on account of difference of sundry creditor balance - As carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials brought on record. We have heard and gone through the above noted findings of ld CIT(A). We did not find any infirmity in the order of ld CIT(A). That being so, we decline to interfere with the order of Id. C.I T.(A) in deleting the aforesaid addition. Income being the peak balance with HDFC Bank - undisclosed closing bank balance - HELD THAT:- We note that ld CIT(A) has confirmed the addition made by assessing officer, which is in favour of Revenue. The Department should not have raised this ground. It seems to us that ground No.6 raised by the Revenue is wrong and therefore does not require adjudication.
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