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TMI Blog2019 (10) TMI 663X X X X Extracts X X X X X X X X Extracts X X X X ..... r valuation of closing stock by taking rate of Guar Seeds @19.53 per kg. as against the value taken by the assessee @ 9.49 per kg. as on 31.03.2010. Ground No. 5 is without prejudice to above grounds that if the closing stock is valued higher than shown by the assessee then Ld. CIT (A) ought to have given direction to the AO to adopt opening stock of subsequent year at the same figure as valued as on 31.03.2010 by the AO. 3. Since Ground No. 1 to 5 are inter connected, same are being considered together. Briefly, stated the facts of the case are that the AO noted that the assessee has shown opening stock at Rs. 2,23,54,322 of 11,67,323.75 Kg of Guar Seed valued at Rs. 19.15 per kg. The assessee has made purchases of 17510 kg. stock during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nded by September 2009, whereas last recorded sale bill was issued by the assessee @ 19.50 per kg. on 15.12.2009. Further, the assessee has purchased guar seeds @ 22.11 per kg. Therefore, the theory of goods become wet and lost quality is totally incorrect. Further, guar seeds were sold in April 2011 @19.53 per kg. In the light of these facts, the AO adopted cost price @19.15 per kg. presuming that goods purchased on 30.07.2009 @ 22.11 per kg. have been sold out and goods out of opening stock were remained in closing stock. In view of these facts and circumstances, the AO made addition of Rs. 79,93,072 by taking cost price @ 19.15 per kg. of closing stock of 8,27,767.5 kg. The AO still allowed loss at Rs. 5,87,328 as against claim of loss a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year were of 3,57,070 Kilograms of which average realization value was at Rs. 17.65 per kg. which were even after mixing the goods purchased @ 22.11 per kg. during year. The learned counsel for the assessee referred APMC rate and NCDEX as per Exhibit B and C respectively which showed that when the assessee has sold goods @ 19.53 per kg. in April 2011, these rates were ranging between 25.50 per kg. to 28.20 per kg. in addition, even 30 to 31.01 per kg. This proves that goods seeds could only be realized @ 19.53 per kg. as they were not of good quality. The learned counsel for the assessee placed reliance in the case of DCIT v. Loil Health Foods Ltd. [2017] 82 taxmann.com 324 (Chandigarh-Trib) and Alfa Laval India Ltd. v. DCIT [2003] 133 Taxm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h-Trib) to contend that where cotton seeds oil and mustard seed oil are perishable items in nature and the assessee explained properly the reason in decrease in closing stock, no addition should be made in closing stock. Similarly, in the case of Alfa Laval India Ltd. v. DCIT [2003] 133 Taxman 740 (Bombay)/ 266 ITR 418 (Bombay) it was held that the obsolete items were sold in subsequent year at a price less than 10 percent of cost the valuation made arbitrarily not justified. Considering the totality of facts and case laws and nature of goods, we are of the considered view that it would be reasonable and justifiable if average rate were applied for valuation of closing stock. We find that rate of opening stock was at Rs. 19.15 per kg. where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... However, considering the increase in turnover by 62% from last year, these women might have been rendered some help to the assessee firm in respect of business activity. In view of this matter, the AO treated payment of Rs. 10,000 per month as reasonable to above person and accordingly, considered payment at Rs. 2,40,000 as reasonable and disallowed balance amount of Rs. 9,20,000 [ 11,60,000- 2,40,000] under the provisions of section 40A(2)(b) of the Act. 10. Being dissatisfied, the assessee preferred an appeal before the CIT (A). However, without any success. 11. Being, dissatisfied the assessee has filed this appeal before the Tribunal. The learned counsel for the assessee submitted that the Assessing Officer has failed to appreciate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue to tax the same income again at the same rate in the hand of principal payer would amount to double taxation". Therefore, following same the matter was remitted back to the AO to verify whether payment has been brought to tax in the hands of recipient at the same rate. if that is so, disallowance will stand deleted. 12. Per contra, the ld. Sr. D.R. relied on lower authorities. 13. We have heard the rival submissions and perused the relevant material on record. We find that the recipient of remuneration are have requisite qualification and rendered service for handling of banking services, moreover, as the AO has accepted part payment reasonable, meaning thereby that they have rendered some services. If that is so, then, no disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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