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2016 (1) TMI 373 - ALLAHABAD HIGH COURT

2016 (1) TMI 373 - ALLAHABAD HIGH COURT - TMI - Bags of Dhania and Chillies lost and damaged by the Railways - ITAT sustaining the valuation of the closing stocks of such goods at the same rate as that of non-damaged goods - Held that:- The Commissioner of Income- tax (Appeals) has rightly held the closing stock is to be valued either at the cost price or the market rate whichever is less and accordingly valued closing stock of Chillies and Dhania on the basis of the cost price. - Decided agains .....

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towards unexplained investment in respect of the excess stocks of Haldi, big cardimum and Magraila as the source of investment had not been explained by the assessee. - Decided against assessee - Civil Misc. Restoration Application No. 26184 of 2010, Income Tax Reference No. - 21 of 1984 - Dated:- 4-1-2016 - Hon'ble Bala Krishna Narayana And Hon'ble Shamsher Bahadur Singh, JJ. For the Applicant : R. R. Mishra, Rakesh Kumaar For the Respondent : B. Agarwal,C.S.C. ORDER This is a referenc .....

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d circumstances of the case, can it be said that a reasonable opportunity has been given to the assessee to prove his contention with regard to the addition of ₹ 34, 675/- to assessee's income and whether the Tribunal was justified in sustaining the addition of that amount." The brief facts of the case are as follows: The assessee is a registered firm and the reference relates to the assessment year 1975-76. The Income Tax officer in the course of the assessment proceedings found .....

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he closing stock of 260 bags of chillies @ ₹ 207/- per bag and 202 bags of Dhania @ ₹ 145/- per bag. There was thus an addition for under valuation of stocks of ₹ 20, 780/- in Chillie account and ₹ 2, 345/- in Dhania account. The income-Tax Officer further found that the stocks pledged with the bank exceeded the stocks shown in the account books and at the end of the year the excess stock amounted to 3 bags of Haldi, 36 bags of Sonth, 53 bags of big cardimum and 18 bags o .....

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ived from them on consignment basis. The Income-tax Officer, therefore came to the conclusion that the nature and source of these excess stocks was not forthcoming and treated the value of these excess stocks amounting to ₹ 34,675/- in the aggregate as assessee's income from undisclosed sources. The assessment was, therefore, completed after making these additions and some other additions as well. The assessee was aggrieved by the assessment and, therefore, went up in appeal before the .....

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ture and source of which, according to the Income-tax Officer, was not forthcoming and which was treated as assessee's income from undisclosed sources, the Commissioner of Income-tax (Appeals) confirmed the addition of ₹ 34, 675/- made by the Income-tax Officer and refused to interfere. Hereto annexed, marked Annexure "B" and forming part of the statement of the case, is a copy of the order of the Commissioner of Income-tax (Appeals). The assessee was not satisfied with the o .....

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particulars of when the claim was made from the Railways or what was the amount of the claim for alleged damage to 121 bags of chillies and loss of 8 bags of Dhanis in transit by Railways. Besides, it is not under dispute that the 81 bags of Dhanis sent to Laxmi Kirana Co. for sale on consignment basis, remained unsold till the end of the previous year. Under the circumstances, the C.I.T. (Appeals) in our view was perfectly justified in valuing these stocks at the market price or cost price whi .....

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sessee claims that it had pledged stocks of other persons also with the bank contrary to its sworn statement furnished to the bank at the time of hypothecation of stocks a very heavy burden lies on the assessee to prove that what he is claiming now and which is contrary to its sworn declaration before the bank, was correct. Viewed in this context, we find that even the certificates of the four parties, whose goods were claimed to be with the assesses for sale on consignment basis and which were .....

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