M/s Bharat Distributors, Chandigarh V. DCIT, Chandigarh

ITA 134/CHANDI/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5162 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 year(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 26-02-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Agreed addition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES A, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 134/CHD/2016 ASSESSMENT YEAR: 2011-12 M/S BHARAT DISTRIBUTORS, VS. THE DCIT, SCO. 361-362, SECTOR 35, CIRCLE 4(1), CHANDIGARH CHANDIGARH PAN NO. AAIFB2936J (APPELLANT) (RESPONDENT) APPELLANT BY : SH. TEJ MOHAN SINGH, ADVOCATE RESPONDENT BY : SMT. CHANDERKANTA ADDL. CIT DATE OF HEARING : 21.03.2018 DATE OF PRONOUNCEMENT : 21.03.2018 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEAL S), [HEREINAFTER REFERRED TO AS CIT(A)]-2, CHANDIGARH DATED 28.12.2 015 . 2. THE ASSESSEE HAS TAKEN FOLLOWING GROUNDS OF APPE AL:- 1. THAT THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACTS IN UPHOLDING THE ADDITION OF RS. 631525/- TOWARDS DIFFERENCE IN STOCK WHICH IS ILLEGAL ARBITRARY AND UNJUSTIFIED. 2. THAT THE LD. CIT(A) HAS FAILED TO APPRECIATE THA T THE ADDITION BECAUSE OF DIFFERENCE IN STOCKS ALREAD Y ITA 134/CHD/2016- BHARAT DISTRIBUTORS, CHANDIGARH 2 STANDS SURRENDERED WHEN STOCK DIFFERENCE OF RS. 10 LAKH ALONGWITH CASH OF RS. 65 LAKH WAS SURRENDERED AT THE TIME OF SURVEY OF THE FIRM M/S BHARAT DISTRIBUTORS. 3. THAT THE UPHOLDING OF THE ADDITION HAD LED TO DO UBLE ADDITION WHEN THE TOTAL AGREED ADDITION OF RS. 10 LAKH TOWARDS DIFFERENCE IN STOCK WAS SURRENDERED IN THE ACCOUNT OF M/S BHARAT DISTRIBUTORS. 3. THE SOLE ISSUE RAISED BY THE ASSESSEE IS RELATIN G TO THE CONFIRMATION OF ADDITION OF RS. 6,31,525/- MADE INTO THE INCOME OF THE ASSESSEE ON ACCOUNT OF DIFFERENCE IN STOCK. 4. THE BRIEF FACTS OF THE CASE ARE THAT A SURVEY AC TION WAS CARRIED OUT IN THE GROUP CASES OF THE ASSESSEE INCLUDING THE ASSES SEE. THE ASSESSEE SURRENDERED RS. 75 LACS OF OUT WHICH RS. 9 LACS WAS SURRENDERED ON ACCOUNT OF UNEXPLAINED CASH, RS. 50 LACS ON ACCOUNT OF AMOU NT RECEIVABLE AGAINST THE PROPERTY RELATING TO THE REAL ESTATE BUSINESS AND AMOUNT OF RS. 10 LACS ON ACCOUNT OF EXCESS STOCK. HOWEVER, ON EXAMINATIO N OF THE RECORD DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER N OTED THAT THERE WAS EXCESS STOCK OF RS. 16.31 LACS. THE ASSESSING OFFIC ER ADJUSTED RS. 10 LACS TOWARDS EXCESS STOCK AND MADE THE ADDITION OF THE E XCESS STOCK QUANTIFIED AT RS. 6.31 LACS. BEING NOT SATISFIED BY THE ABOVE ADDITION, THE ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(A). THE LD. CIT(A) CONSIDERED THE RIVAL SUBMISSIONS AND DISMISSED THE AFORESAID GROUNDS OF THE APPEAL OBSERVING AS UNDER:- 4.4 THE SUBMISSIONS OF THE APPELLANT HAS BEEN CONSIDERED CAREFULLY. THE ASSESSING OFFICER HAS MAD E ADDITION ON THE BASIS OF EVIDENCE COLLECTED AS A RE SULT OF ITA 134/CHD/2016- BHARAT DISTRIBUTORS, CHANDIGARH 3 SURVEY. THE STOCK WAS INVENTORIED AT THE TIME OF SU RVEY WHICH WAS CERTIFIED AND ACCEPTED AS CORRECT BY THE APPELLANT. THE BENEFIT OF G.P. HAS ALREADY BEEN ALL OWED TO THE APPELLANT IN WORKING OUT THE EXCESS STOCK. T HE SUBMISSION OF THE APPELLANT THAT ASSESSING OFFICER HAS NOT ESTABLISHED ANY NEXUS OF EXCESS STOCK WITH THE BOOK S OF ACCOUNT IS DEVOID OF MERIT. THE EXCESS STOCK HAS BE EN WORKED OUT AS PER THE ACTUAL STOCK INVENTORIES VIZ A VIZ STOCK AS PER BOOKS OF ACCOUNT AND THEREFORE, I DO N OT SEE ANY REASON TO INTERFERE WITH THE ORDER OF THE ASSES SING OFFICER ON THIS POINT. THE ADDITION MADE BY THE ASS ESSING OFFICER OF RS. 6,31,525/- IS CONFIRMED. GROUND OF A PPEALS NO.1 & 2 ARE DISMISSED. 5. WE HAVE HEARD THE RIVAL CONTENTIONS OF THE LD. R EPRESENTATIVES OF THE PARTIES ON THIS ISSUE. WE FIND THAT ASSESSEE COULD NOT EXPLAIN THE SOURCE OF EXCESS STOCK FOUND DURING THE SEARCH ACTION. THE AS SESSING OFFICER HAS ALREADY GIVEN BENEFIT OF RS. 10 LACS SURRENDERED BY THE ASSESSEE ON THIS ACCOUNT. FURTHER, THE PERUSAL OF THE ORDER OF THE C IT(A) REVEALS THAT THE BENEFIT OF GROSS PROFIT HAS ALREADY BEEN ALLOWED TO THE ASSESSEE IN WORKING OUT THE EXCESS STOCK. 6. IN VIEW OF THIS, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. THERE IS NO MERIT IN THE APPE AL OF THE ASSESSEE AND THE SAME IS ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 21.03.2018 RKK ITA 134/CHD/2016- BHARAT DISTRIBUTORS, CHANDIGARH 4 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR