TMI Blog2017 (7) TMI 201X X X X Extracts X X X X X X X X Extracts X X X X ..... omes to 20.48% and further GP rate accepted in this year is undeniably 22%. In such circumstances, we hold, it would be fair and reasonable to adopt the GP rate of the current year i.e. 22% for the purpose of calculating stock as per Books on the date of search. The retraction of the assessee is to this extent, therefore, accepted. The Assessing Officer is therefore directed to compute the difference in stock found on the date of search by calculating the stock as per Books by applying GP rate of 22% to the trading results of the assessee as on the date of search. The Gross Profit on the stock found short if any is also directed to be calculated after applying GP rate of 22% and addition is directed to be upheld of the same. - ITA No.591/Chd/2013 - - - Dated:- 16-12-2016 - SHRI BHAVNESH SAINI, JUDICIAL MEMBER, AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER For The Appellant : Shri Vineet Krishan For The Respondent : Shri Sushil Kumar, CIT DR ORDER PER ANNAPURNA GUPTA, A.M. : This appeal filed by the assessee is directed against the order of learned Commissioner of Income Tax (Appeals)(Central), Gurgaon dated 12.03.2013, relating to assessment year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stock vis- vis family members, the stock was sent to the premises of Jain Brothers and in the mean time search was conducted and excess stock found at Jain Brothers, while short stock was found with the assessee. c) While valuing the stock found, cost of certain items was taken less and there was certain calculation mistake also totaling to ₹ 3,43,931/-. d) GP rate of 26% applied for calculating stock as per books was unreasonable and if GP rate of 22% was applied the difference in stock would be reduced by ₹ 10 lacs. 6. The Assessing Officer rejected the retraction made on all accounts by stating as under : 1) The statement was given voluntarily without any force and nothing was produced by the assessee to evidence coercion, threat or pressure at the time of surrender. 2) No material was there to suggest any mistaken belief of law or fact to hold the retraction as valid. 3) The family settlement took place more than 7 months before search i.e. in April, 2007. No other family member has made such claim, no documents produced to show that the stock was transferred to Jain Brothers, no entry in the books of Jain Brothers to evidence the transfer and ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Produce Co. Vs. State Of Kerala And Anr. (1973) 91 ITR 18 (SC) has stated that the retraction from surrender of income made under section 132(4) of the Act may be accepted on the facts of the case. The Hon'ble Apex Court held as under : An admission is an extremely important piece of evidence but it cannot be said that it is conclusive. It is open to the person who made the admission to show that it is incorrect . 14. This proposition was reiterated by the Hon'ble Jurisdictional High Court in the case of Krishan Lal Shiv Chand Vs. CIT (1973) 88 ITR 293 wherein the Hon'ble High Court held as under : It is an established principle of law that a party is entitled to show and prove that the admission made by him previously is in fact not correct and true . 15. Therefore, it is settled law that if the facts so warrant even a surrender made on oath under section 132(4) of the Act may be retracted. The reliance placed by the Ld.DR on the decision in the case of B.Kishore Kumar (supra), with reference to retraction from statement after a long time gap, we find is misplaced since in that case the Hon ble court had found that there was a clear and categorical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessment Year 2002-03, 2003-04, 2004-05, 2005-06, 2006-07 and 2007-08 respectively. The average rate comes to 20.73%. That the rates shown in earlier years cannot be ignored and if the rate as shown in the A.Y. 2002-03 and 2003-04 is applied, there would be hardly any difference. The fact that there was a family dispute which was settled seven month earlier to the search operation is not in debate. The stock in the assessee case was found short while excess stock was found in the other concern M/s Jain Bros. Both the concerns are engaged in the same business of trading in readymade garments. Be that as it may, the stock of goods stated to be part of the family settlement or that part of the stock was lying with jain Bros, have not been evidenced documentarily. Five bills have been listed at page 10 which have not been accounted for, three of which are dated August 2007. So the contention that barring two-three days' vouchers prior to date of search, all have been entered in the books is incorrect. Similarly the sixth bill of repairs/maintenance of vehicles which has been discredited as dumb document/ assessee-firm not owning any vehicle is also not tenable as the au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record. The contention of the assessee that the surrender was made under pressure appears to be a mere statement with no basis at all. Once the statement has been given making a surrender, the presumption is that it has been given voluntarily without any pressure or coercion and while stating otherwise for retracting the same, the onus is on the assessee to prove so, as held by various Courts as follows : i) Manoharlal Kasturichand Vs. ACIT (1997) 57 TTJ (Ahd)639 ii) Param Anand Builders (P Ltd. Vs. ITO (1996) 56 TTJ (Ahd) 21 19. Therefore, we hold that, the admission made by the assessee, surrendering the excess stock, cannot be rejected as admissible evidence on this ground. 20. The next contention of the assessee for retracting the surrender, that there was actually no shortage of stock since certain stock belonging to the assessee was at the premises of Jain Brothers on account of family settlement, has also been rightly rejected by the Ld. CIT (Appeals). As pointed out by the Ld. CIT (Appeals), the dispute was settled 7 months back, which fact has not been controverted by the assessee. Further no documentary evidence has been produced to prove the stock at the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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