TMI Blog2018 (5) TMI 1171X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee. He merely recorded it and thereafter, examined the materials on record. Two things emerge from such exercise; firstly, he did not accept the assessee’s declared evaporational loss of raw materials and secondly, he noticed that the assessee was unable to produce the books of accounts on the ground that the Sales Tax Department had impounded them. He, therefore, proceeded to frame the best judgment assessment. He was of the opinion that the Gross Profit shown by the assessee was low. He made adjustments by citing reasons, which resulted into the additions being made. No where can we see that the Assessing Officer accepted the assessee’s contention that the stock discrepancies stood explained. AO noted that in view of the Gross ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere was discrepancy in the stock between the assessee s books of accounts and stock statement given to the bank. The assessee appeared before the Assessing Officer and tried to explain that the discrepancy was on account of the stock in transit. The Assessing Officer, however, proceeded to frame reassessment. By an order dated 20.03.2006, he added a sum of ₹ 35.67 lakhs as assessee s undisclosed income. In the process, he rejected the assessee s books of accounts. He did not accept the assessee s declaration of loss of rawmaterial during manufacturing process. He recorded that the assessee had declared excessive loss as compared to the normal range of evaporation reported in the trade. He adjusted the assessee s Gross Profit rate and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as described in the stock reported by the assessee in its books of account, as compared to the stock reported to the bank. The assessee s contention before the Assessing Officer was that this discrepancy was on account of transit of stock. Contrary to what was canvassed before us, we do not find that the Assessing Officer accepted such explanation of the assessee. He merely recorded it and thereafter, examined the materials on record. 4. Two things emerge from such exercise; firstly, he did not accept the assessee s declared evaporational loss of raw materials and secondly, he noticed that the assessee was unable to produce the books of accounts on the ground that the Sales Tax Department had impounded them. He, therefore, proceeded to f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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