TMI Blog2021 (1) TMI 642X X X X Extracts X X X X X X X X Extracts X X X X ..... manpower. The exact quantum of earth and coal was not available. Above all the stock valuation was done by the survey team on 20.01.2015 and this is extrapolated to value stock as on 31.03.2010. Such an exercise is arbitrary and erroneous. When the assessee is maintaining proper books of account and when the AO has not pointed out any defects in these books and when he did not reject them, it is not open for the AO to ignore these books of account and adopt the value of stock as estimated by the survey team. Such an addition cannot be upheld. Thus we delete the same. Eligible jurisdiction of AO - whether such an assessment order is valid in the eyes of law when the jurisdictional assessing officer has not issued a notice u/s. 143(2)? - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of closing stock of ₹ 11,05,651/- and (ii) Disallowance of pathrea expenses of ₹ 3,40,550/-. The assessee preferred an appeal before the Ld. CIT(A)-6, Kolkata, who passed an order dated 13.03.2019 in which the addition of ₹ 3,40,550/- on account of disallowance of Patherea Expenses was deleted. The addition of ₹ 11,05,651/- on account of under valuation of closing stock was upheld. 3. Aggrieved the assessee is in appeal before us. 4. The assessee filed the following grounds: i. For that in the facts and circumstances of the case the Ld. CIT(A) erred in upholding the addition of ₹ 11,05,651/- on account of under valuation of closing stock. The addition was uncalled for an unjustified and the same b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment u/s. 143(3) of the Act, without giving any notice u/s. 143(2) of the Act. Thus he submits that the assessment is bad in law. For this proposition, he relied on the following decision: i. 2020(11) TMI 310-ITAT Lucknow ITO-6(1), Kanpur vs. M/s. Arti Securities Services Ltd. order dated 06.11.2020 ii. 2020 (3) TMI 418-ITAT Kolkata K.A. Wires Ltd. vs. ITO, Ward-8(3), Kolkata order dated 22.01.2020 7. The assessee submits that in making the addition of ₹ 11,05,651/- on account of under valuation of closing stock, the Ld. Assessing Officer exclusively relied on the stock valuation made by the survey team on the date of survey. While doing so he failed to appreciate the fact that valuation of closing stock made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITO, Ward-24(2), Hooghly and hence he need not give fresh notice u/s. 143(2) of the Act. He argues that the assessment order is valid in law. On merits, the ld. DR submitted that stock valuation was done by the survey team and that at the time of survey and the assessee had not denied the valuation done, with cogent material. He submitted that burden of proof lies on the assessee to refute the conclusion done by the survey team with evidence and that the assessee did not discharge this burden of proof. He took this bench to page 2, para 2 of the assessment order and relied on the same. He also relied on the order of the Ld. CIT(A) and prayed that the appeal of the assessee be dismissed. 10. Rival contentions heard. On a careful considera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eted the assessment. The ACIT, Circle-24(1), Hooghly has not issued a notice u/s. 143(2) of the Act. The issue is whether such an assessment order is valid in the eyes of law when the jurisdictional assessing officer has not issued a notice u/s. 143(2) of the Act. 13. This issue is no more res integra. The Lucknow Bench of the Tribunal in the case of Arti Securities Services Ltd. (supra) and Kolkata Bench of the Tribunal in the case of K.A. Wires Ltd. (supra) have adjudicated, a similar issue, in favour of the assessee. Respectfully follow the same we hold that the assessment order is bad in law. 14. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on November 14, 2020. - - TaxTMI - TMI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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