TMI Blog2014 (4) TMI 1155X X X X Extracts X X X X X X X X Extracts X X X X ..... ed out on the basis of seized papers and since in the present case no such incriminating evidence was found regarding method of valuation of stock as the A.O. tried to adopt, the Learned CIT(A) was justified in deleting the addition - Decided against revenue - ITA No. 1376/PN/2013 - - - Dated:- 30-4-2014 - Shri R.S. Padvekar, Judicial Member and Shri R.K. Panda, Accountant Member Assessee by : Shri Suhas Bora Revenue by : Shri M.K. Singh ORDER PER R.K. PANDA, AM : This appeal filed by the Revenue is directed against the order dated 12-04-2013 of the CIT(A), I, Pune relating to the Block Period 01- 04-1996 to 24-10-2002. 2. The only effective ground raised by the Revenue reads as under: On the facts and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. From the value arrived in this manner of the opening stock and purchases is added and similarly the quantity is also added. The value is divided by the quantity to arrive at an average price. According to the Assessing Officer, this method of valuation holds good if there are no unaccounted purchases and sales. However, during the course of search evidences were found that the assessees of Ranka group were indulging in making unaccounted purchases and sales. If the unaccounted purchases are also taken into consideration for the purpose of determining the average price, the average price is increased in comparison to the average price determined by the assessee, for the purpose of valuation of closing stock in the books. 2.3 The Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has subsequently been upheld by the Pune Bench of the Tribunal vide ITA Nos. 801, 820 and 994/PN/2006 order dated 06- 06-2011 the Ld.CIT(A) deleted the addition of ₹ 12,37,818/-. 3.2 Aggrieved with such order of the CIT(A) the Revenue is in appeal before us. 4. After hearing both the sides, we find an identical issue had come up before the Tribunal in the case of M/s. Ranka Jewellers Vs. Addl.CIT vide ITA Nos. 801, 820 and 984/PN/2006 order dated 06-06-2011 for the block period 01-04-1996 to 24-10-2002. We find the Tribunal while deciding identical issue has dismissed the appeal filed by the Revenue by observing as under: 30. Ground No.3 The relevant facts are that the assessee firm engaged in jewellery business and follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that average cost method is accepted method of stock value and it was being accepted by the department in assessee's own case in the past. In support of the same, decisions were cited which have been reproduced by the Learned CIT(A) at page nos. 32 and 33 of the first appellate order, wherein the Hon'ble courts have accepted such average cost method followed by the assessees. Considering these submissions learned CIT(A), in our view has rightly come to the conclusion that there was no reason to reject the method of valuation of stock and the addition made was thus not justified. We also find substance in the observations of the Learned CIT(A) on the issue that undisclosed income has to be worked out on the basis of seized papers ..... X X X X Extracts X X X X X X X X Extracts X X X X
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