TMI Blog2016 (6) TMI 587X X X X Extracts X X X X X X X X Extracts X X X X ..... the scope of review does not extend to rehearing of the case on merit.In view of the above, we are inclined to reject the arguments of the assessee’s counsel on the issue of valuation of closing stock in all these Misc. Applications. - Decided against assessee Addition towards stock discrepancies - Held that:- Tribunal has considered the issue in dispute and categorically given a finding and decided the issue against the assessee and there is no reason to recall the earlier order of the Tribunal. Being so, as discussed in earlier para, we are inclined to reject the arguments of the ld. AR in all these three Misc. Applications, on this issue. - Decided against assessee Disallowance towards lease commitment charges - Held that:- Tribunal has given a finding that the expenditure of Rs. one crore incurred by the assessee towards lease commitment charges cannot be considered as wholly and exclusively for the purpose of business. Hence, it is decided against the assessee. Now, the assessee’s counsel wants to re-argue the case and it cannot be possible. As discussed in earlier para, we are inclined to reject the arguments of the ld. AR in all these three Misc. Applications, on this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. According to the ld. AR, the assessee is valuing the closing stock on the basis of net realisable value for clothes having in mind the period for which the clothes have not been sold. In a fast moving fast changing fashions old clothes lose their value. When clothes are not sold for a year, their sale value drastically falls down. It is only by offering deep discounts can the assessee hope to sell some of the old stocks. If the assessee is not able to sell stock for more than three years, even by offering discounts, such stocks are hardly likely to fetch any price. Thus, the valuation of the stock by the assessee based on the experience cannot be rejected without any valid reason. 3.1 The ld. AR, also submitted that the method of valuation is reflected in the closing stock valuation in the audited balance sheet and profit and loss filed along with the return for the asst. year 2006-07 onwards (much before the search conducted in Feb 2009) and not an afterthought after the search. It is therefore submitted that the Tribunal erred in concluding that the method of valuing the stock was an afterthought after the search and hence the order requires rectification. Therefore, h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... either allowing the amendment or refusing to amend gets merged with the original order passed. The order as amended or remaining un-amended is the effective order for all practical purpose. An order under section 254(2) does not have existence de hors the order under section 254(1). Re-calling of the order is not permissible under section 254(2). Recalling of an order automatically necessitates rehearing and re-adjudication of the entire subject-matter of appeal. The dispute no longer remains restricted to any mistake sought to be rectified. Power to recall an order is prescribed in terms of Rule 24 of the ITAT Rules, 1963, and that too only in case where the assessee shows that it had a reasonable cause for being absent at a time when the appeal was taken up and decided ex parte. Judged in the above background the order passed by the Tribunal is indefensible. 8. The words used in section 254(2) are shall make such amendment, if the mistake is brought to its notice . Clearly, if there is a mistake, then an amendment is required to be carried out in the original order to correct that particular mistake. The provision does not indicate that the Tribunal can recall the entire ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... search which stood at Rs. 1,96,21,842/- and in answer to question No.10, he stated that there are duplicate entries while taking the stock. The details of book stock submitted by the assessee during the course of search operation have been double checked and it is correct. Similarly, the physical stock of goods lying in Vannarapettai shop and also town shop was taken with the active participation of their staff under their own supervision and valuation thereof has also been checked, the same is found to be correct. Hence, subject to any duplicate entries or change in the dates as stated above, he accepted the value of excess stock found during the course of search to be out of their unrecorded income and agreed to pay the income-tax due on such income for the year. During the course of investigation vide letter dated 10.8.2009 submitted to the ADIT (Investigation) by Sri Shiva Kumar, no specific arguments relating to the figures of stock were raised except pointing out that the physical stock at Tirunelveli was mentioned in the tabulation reflecting the physical stock for the group as a whole. The said mistake was rectified by the AO while passing the order. The AO after consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has not appreciated the confirmation by the AO that they do not have particulars of search day stock taken by the department. Hence there cannot be any addition on this count and the addition on this account requires to be deleted. 12.2 The ld. AR further submitted that it is not open to the Department to contend that there was discrepancy in the stock records of the assessee in the light of the fact that the assessee had all the records to prove that they were, with their books and inventory recording system, able to bring out the fact that the inventory as per books was correct while the Department either did not have full particulars of the inventory on the date of search or the inventory list taken by them and in possession of the Department suffered from serious short comings. Accordingly, he prayed that the Tribunal may be appreciated the above aspects and facts of the case. 13. The ld. DR relied on the order of the Tribunal. 14. As discussed earlier, the Tribunal has considered the issue in dispute and categorically given a finding and decided the issue against the assessee and there is no reason to recall the earlier order of the Tribunal. Being so, as discussed in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order of the Tribunal. 18. We have heard both the parties and perused the material on record. On this issue also, the Tribunal has given a finding that the expenditure of Rs. one crore incurred by the assessee towards lease commitment charges cannot be considered as wholly and exclusively for the purpose of business. Hence, it is decided against the assessee. Now, the assessee s counsel wants to re-argue the case and it cannot be possible. As discussed in earlier para, we are inclined to reject the arguments of the ld. AR in all these three Misc. Applications, on this issue also. 19. The next grievance of the assessee in MA No.240/Mds/2016 is with regard to addition of ₹ 29,92,775/- towards unexplained jewellery. 20. The ld. AR, before us, now, submitted that the assessee has raised a specific ground before the CIT(Appeals) challenging the addition made towards unexplained jewellery. However the same was not adjudicated by the CIT(Appeals). Therefore, the ld. AR submitted that the assessee raised the ground No.7 before the Tribunal challenging the order of CIT(Appeals) for not adjudicating the ground in the appeal challenging the addition of ₹ 29,92,775/-. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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