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M/s. Jalaram Textile Versus Income-tax Officer, Ward-2, Anand and Vicce-Versa

2017 (1) TMI 1241 - ITAT AHMEDABAD

Penalty u/s.271(1)(c) - unaccounted stock addition along with GP computed there upon - Held that:- It is evident that the lower authorities have simply gone by stock statement difference in assessee’s books as compared to that declare to the above stated co-operative bank totaling to ₹ 41,39,130/- in the first round and the same has been split over in the two impugned assessment years in the latter consequential round subject matter of appeal before us. They don’t even refer to a single pi .....

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only on the ground that the assessee had utilized interest bearing fund for non business purposes u/s.36(1)(iii) of the Act. This is not the Revenue’s case that it had not disclosed all the relevant particulars resulting in the impugned disallowance. It is thus evident that the assessee sought to contest Assessing Officer’s show cause alleging diversion of interest bearing funds which ultimately went in Revenue’s favour. We accordingly conclude that the same cannot be held to be a case of furnis .....

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01 & 2001-02 arise against CIT(A)-IV, Baroda s separate orders dated 03.01.2015 & 18.07.2011, in appeal nos. CAB/4-103/2014-15 & CAB/IV-A-206/2010-11 in proceedings under section 143(3) r.w.s. 254 of the Income Tax Act, 1961; in short the Act in former appeal and U/s. 143(3) r.w.s. 147 of the Act in latter case; respectively. The Revenue on the other hand has instituted its appeal against the CIT(A)-IV, Baroda s order dated 22.12.2014 deleting penalty of ₹ 8,84,290/- as imposed .....

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nter alia challenging unaccounted stock addition of ₹ 16,06,680/- along with GP computed there upon of ₹ 7,85,192/- by the Assessing Officer and restricted to that to ₹ 3,04,786/- in the lower appellate proceedings. A combined perusal of the instant case file reveals that this is second round of litigation between the parties before this tribunal. The Assessing Officer had framed a regular assessment in assessee s case on 19.03.2004 adding a sum of ₹ 41,39,130/- in the na .....

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r addition of ₹ 7,85,192/- over and above the above stock addition. The assessee preferred appeal. The CIT(A) s order dated 07.03.2005 deleted the same. The Revenue then filed ITA No.1551/Ahd/2005 before this tribunal. The co-ordinate bench in its order dated 11.09.2009 restored the issue back to the Assessing Officer as under: 9. We have heard the rival submissions, perused the orders of the lower authorities and the materials available on record. A perusal of the statement submitted to t .....

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he bank has been furnished to us for either of the two years, but for the sake of natural justice, we would like the Assessing Officer to ask the assessee to submit the stock statement furnished to the bank as on the end of the accounting year relevant to assessment years 1999-2000 & 2000-01 and work out the alleged discrepancy existing in those years and as claimed by him before us. If any quantitative difference is discovered in these two earlier years, then assessment for these two assess .....

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and proceed according to law without any fetters on the quantum in those years. This will be treated as our directions within the meaning of section 153(3) of the IT. Act, 1961. 3. The Assessing Officer accordingly took up consequential proceedings. He noticed in course thereof that the assessee s stock statement for immediate preceding assessment year indicated a difference of ₹ 25,32,450/- in the disclosures made in the books of accounts vis-à-vis those stated before the above co- .....

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essee preferred two separate appeals. The CIT(A) confirms Assessing Officer s action in principle in both assessment years. The only exception is that he has restricted gross profit addition in assessment year 2001-02 made @18.97% on ₹ 16,06,680/- only instead of the entire addition sum in first round of ₹ 41,39,130/-. This leaves the assessee aggrieved in both the impugned assessment years. 5. We have heard both the parties. Case files perused. Learned counsels strongly reiterate th .....

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ement disclosed to the bank which could indicate there has been any excess stock item in its relevant books or other evidence. It is thus apparent that the impugned addition is based upon assessee s stock statement given to the bank as prepared on estimation basis only instead of actual figures. We notice in this factual backdrop that hon ble jurisdictional high court in Tax Appeal no.2041/2010 CIT vs. M/s. Meico Board s Pvt. Ltd. decided on 05.12.2011 and CIT vs. Arrow Exim Pvt Ltd. (2010) 230 .....

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additional grounds raised in the appeal challenging the impugned additions on the basis of above case law as rendered infructuous. 6. This leaves us with Revenue s appeal ITA No.695/Ahd/2015. The Assessing Officer levied the penalty in question amounting to ₹ 8,84,290/- as pertaining to unaccounted stock addition of ₹ 16,06,680/- and profit thereupon by treating the same as unrecorded sales of ₹ 3,04,787/- followed by yet another disallowance of interest. There can hardly be an .....

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