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2021 (6) TMI 244 - ITAT INDOREAddition u/s 69/115BBE - unexplained money on the basis of difference in stock statement submitted to the lender bank and Krishi Upaj Mandi Samiti, Agar Malwa - A.O made addition on the ground that the appellant has shown more stock to the bank as hypothecated than in the books of accounts - Assessee argued that result reflected in the books of accounts or stock shown in the books of accounts has not been considered in its proper perspective by the Ld. A.O - HELD THAT:- As appellant is subjected to the statutory audit under the various Act, 1961 and Excise Act. No discrepancy was found by the department. It is the settled position of law that addition cannot be made u/s 69B of the Act based on stock shown and inflated quantity/value of stock given to bank to avail higher credit facilities. If the addition made was allowed to continue, the financial statement would get completely distorted. Such an addition on account of difference in stock can only be made on adequate material which admittedly was filed to be relied upon by AO. We have also considered the order passed in the case of CIT V/s Arrow Exim (P) Ltd [2010 (1) TMI 769 - GUJARAT HIGH COURT] where the stock hypothecated with bank valued higher than shown in the books of accounts. When no defect is found with the accounts of the assessee explanation rendered by the assessee that the inflated statement was given to the bank to avail higher credit is to be considered in its proper perspective, no interference in deleting such addition either by Ld. CIT(A) or by the Tribunal is called for as of the observation of the Hon'ble Court. Considering the explanation rendered by the appellant in support of the accounts maintained by the assessee for inflated statement submitted to the bank to avail higher credit, we find no justification in the order passed by Ld. CIT(A) in deleting such addition made by the Ld. A.O on account of unexplained investment without any ambiguity so as to warrant interference. Hence we find no merit in the appeal preferred by Revenue and the same is, thus, hereby dismissed.
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