TMI Blog1993 (1) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... n the following circumstances. The assessee is a firm trading in, as we mentioned earlier, gum, dry fruits, heeng and jera both atBombayandDelhi. During the course of assessment proceedings, it was noticed by the ITO that there were some sales of gum without sufficient stocks on hand. In the course of scrutiny it was found that there was opening balance of Rs. 2,670 kg. of gum on1st July, 1982but the assessee sold 971 kg. on2nd July, 1982and 456 kg. on9th July, 1982. Further a quantity of 4,000 kg. was transferred to compound Heeng Account taking the aggregate of these items to 5,427 kg. The assessee had purchased 4,171 kg. of gum on10th July, 1982. Thus, when the stocks available on10th July, 1982were compared with the stocks sold or tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, it was found that this cash was sent through the medium of persons but the travelling expenses were nowhere debited in the books of accounts. From this an inference was drawn that the sum though said to have been sent to Bombay was not sent to Bombay Office and the corresponding credits shown in the Bombay Office books must have come out of the undisclosed income of the assessee. The explanation of the assessee that this money was sent toBombaythrough Mrs. Vasudev and one Shri Krishan Chand was not accepted because the assessee was not able to produce either of them before the ITO for his examination. This amount was added by the ITO as income of the assessee from undisclosed sources and this addition was confirmed both by the Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1982and the receipt of the goods was available with the assessee. We have so far not been shown any evidence or circumstances leading to the conclusion that this purchase was not made and the stocks involved in that purchase were not received by the assessee and were not available with the assessee for being dealt with either for sale or for transfer. There is complete stocks tally and all the purchases made including the opening stock were fully accounted for in the sales and the closing stock. There was no deficiency in the gum account except delay in the entry made in the account books. There may be a little discrepancy in making the entries in the stock register from the purchase register as and when the purchase and sale had taken pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y unlikely. If such a thing would have happened, there would have been a wide variation in the stock tally. As there is no discrepancy in the stock tally, the inference that the purchases made and entered in the account books were sold and the sale proceeds were not brought in the accounts is not capable of being countenanced. The reasons given by the ITO in support of this addition of Rs. 1 lac are also very queer and are difficult to follow. The ITO mentioned in his order: "The second point, which is established is that on 31st July, 1982 the assessee sold the new consignment received again outside the books of account, so far as that was never accounted for additional stock either in closing stock or by subsequent sale. That means that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of withdrawal from Delhi. Now if the answers to all these questions are in the affirmative, then the source for the credits in theBombaybooks is the withdrawal inDelhibooks. It is not the case of the Revenue that the cash withdrawn from Delhi books was spent for purpose other than for being sent to Bombay and that this money was not available to the assessee to be sent to Bombay. In the case of the first debit inDelhi, we have verified from the books of accounts and found that the credits inBombaywere all on dates subsequent to the dates of withdrawal from Delhi Office. Therefore, the source for the credits inBombayoffice is fully explained. Thus, this addition, though sustained by the Tribunal, could not be said to be concealment of inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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