9911796707
TMI Blog2003 (7) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent (hereinafter referred to as the "assessee") is an individual, deriving income from manufacture and sale of ayurvedic herbs. Search and seizure operations, under section 132 of the Act were conducted at the business premises of the assessee on September 10, 1990. An inventory of the stocks of the finished products and packing cartons of the two proprietary concerns of the assessee, namely, M/s. Shahnaz Herbal and M/s. Shahnaz Ayurvedic, was taken and the value of the finished products as well as packing material was worked out. During the course of assessment proceedings, the assessee was required to reconcile the value of the finished stocks and packing material determined at the time of search with the entries in the books of acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee before him it was clear that maximum retail price also included retailers margin of profit; the gross profit of the assessee for the year 1991-92, which was 72 per cent., had to be deducted from the value of the stock so determined; and that the assessee had calculated the value of the finished product after applying the G.P. rate of the current year, whereas the Assessing Officer had not brought on record any evidence to substantiate the basis of the gross profit rate applied by him in the case of M/s. Shahnaz Ayurvedic, the Commissioner held that the addition could not be sustained. Accordingly, he deleted the addition of Rs. 6,64,527. As regards the second addition with regard to the stock of cartons, the Commissioner again acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anding counsel for the Revenue. Learned counsel submits that the order of the Tribunal is perverse inasmuch as it has failed to take into consideration the material brought on record by the Assessing Officer while making the subject additions. Learned counsel would also submit that the difference in the figures of the value of finished goods estimated by the Department and declared by the assessee being substantial, it could not be deemed to have been explained by the assessee by merely taking the stand that the difference was on account of estimate only, as held by the Commissioner and affirmed by the Tribunal. Learned counsel has also urged that no evidence having been furnished by the assessee in support of its claim that the value of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... substantial question of law, is involved in the instant case. In the present case, while affirming the view taken by the Commissioner, the Tribunal has, inter alia, observed that since the value of the finished stock actually found was determined not only at cost, there was scope for taking its value on the higher side, particularly, when admittedly the value of the stock of finished goods as per books was worked out by the search party on estimate and hypothetical basis and that the adjustment made by applying an estimated GP rate could not be considered as a concrete and foolproof calculation of the value of stock of finished goods and, therefore, there was scope for difference arising on estimate. The Tribunal has noted that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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