Shri Vipulkumar Kiritlal Shah, Anand V. The Income tax Officer, Ward-1, Anand

ITA 1417/AHD/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6373 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 1 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 14-06-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 22-04-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Assessee Lawyers: ASHEEM L THAKKAR
• Keywords: Deemed to accrue or arise in india
• Section: 133A; 69B

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL D BENCH AHMEDABAD (BEFORE S/SHRI BHAVNESH SAINI, JM AND A. N. PAHUJA, AM) ITA NO.1417/AHD/2008 A. Y.: 2004-05 SHRI VIPULKUMAR KIRTILAL SHAH, PROP. SHREEMAN FASHION, JUNA RASTA, ANAND VS THE INCOME TAX OFFICER, WARD 1, ANAND PA NO. AHNPS 2765 A (APPELLANT) (RESPONDENT) APPELLANT BY SHRI ASHEEM L. THAKKAR, AR RESPONDENT BY SHRI B. L. YADAV, DR O R D E R PER BHAVNESH SAINI: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED CIT(A)- I V, BARODA DATED 18 TH FEBRUARY, 2008 FOR ASSESSMENT YEAR 2004-05. 2. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOT H THE PARTIES, PERUSED THE FINDINGS OF THE AUTHORITIES BELOW AND C ONSIDERED THE MATERIAL AVAILABLE ON RECORD. 3. ON GROUND NO.1 OF THE APPEAL, THE ASSESSEE CHALL ENGED CONFIRMING OF ADDITION OF RS.9,832/- AS UNEXPLAINED INCOME BEING EXCESS CASH FOUND ON THE DATE OF SURVEY. IN THIS CA SE, SURVEY U/S 133A OF THE IT ACT WAS CARRIED OUT IN THE BUSINESS PREMISES OF THE ASSESSEE ON 14-10-2003. THE AO MADE ADDITION OF RS. 9,832/- ON ACCOUNT OF EXCESS CASH FOUND IN THE PREMISES OF THE ASSESSEE ON THE ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 2 DATE OF SURVEY. THE ASSESSEE SUBMITTED BEFORE THE A O THAT HIS FATHER SITS IN THE CASH COUNTER IN THE MORNING AND PUTS AL L THE CASH LYING IN HIS POCKET IN THE TILL. THE SAME IS PURELY PERSONAL MONEY. THE AO WAS NOT CONVINCED WITH THE SUBMISSION OF THE ASSESS EE AND HELD THAT THE TRANSACTIONS WERE MOSTLY ON CASH BASIS AND THER E WAS NO EVIDENCE THAT THE CASH IS PERSONAL MONEY. ADDITION WAS ACCORDINGLY MADE. THE ASSESSEE REITERATED THE SUBMISSIONS BEFOR E THE LEARNED CIT(A) AND IT WAS ALSO SUBMITTED THAT IF THE SAME I S TO BE TAXED, GP ELEMENT IN THE AMOUNT CAN ONLY BE BROUGHT TO TAX AS THE CASH GENERATED CAN BE OUT OF UNACCOUNTED SALES. THE LEAR NED CIT(A) DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND NOTED THAT THERE IS NO EVIDENCE THAT CASH WAS PERSONAL CASH OF THE FATHER OF THE ASSESSEE AND FURTHER CONTENTION OF THE ASSESSEE THAT GP ADDI TION MAY BE MADE HAS NO MERIT AND ADDITION WAS ACCORDINGLY CONFIRMED . 4. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LEARNED CIT(A). THE LEA RNED DR RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW AND SUBMIT TED THAT NO EVIDENCE WAS FILED BEFORE THE AUTHORITIES BELOW TO SUBSTANTIATE THE EXPLANATION. 5. ON CONSIDERATION OF THE RIVAL SUBMISSION, WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE ON THIS GROUND. IT IS UNDISPUTED FACT THAT DURING THE COURSE OF SURVEY THE INVENTORY OF CASH WAS TAKEN AND ACCORDING TO SAME EXCESS CASH WAS FOUND OF RS.9 ,832/- AFTER TAKING INTO ACCOUNT OF BOTH THE FRESH CASH POSITION ON THE DATE OF SURVEY. THE INVENTORY OF CASH IS NOT DISPUTED BY TH E ASSESSEE BEFORE ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 3 THE AUTHORITIES BELOW. THE ASSESSEES EXPLANATION T HAT THE CASH BELONGED TO HIS FATHER WAS NOT SUBSTANTIATED THROUG H ANY EVIDENCE OF MATERIAL ON RECORD. THE ASSESSEE IS AN INDIVIDUAL A ND ALL THE TRANSACTIONS WERE MOSTLY FOUND ON CASH BASIS, THERE FORE, CASH IS DIRECTLY CONNECTED WITH THE BUSINESS OF THE ASSESSE E AND CANNOT BE PERSONAL PROPERTY OF THE FATHER OF THE ASSESSEE. TH E ASSESSEES EXPLANATION HAS THUS NO MERIT WHICH WAS RIGHTLY REJ ECTED BY THE LEARNED CIT(A). THE ASSESSEE IN ALTERNATE SUBMISSIO N SUBMITTED BEFORE THE LEARNED CIT(A) THAT ONLY GP ELEMENT MAYB E TAXED BECAUSE THE CASH IS GENERATED OUT OF UNACCOUNTED SA LES. THIS SUBMISSION OF THE ASSESSEE IS ALSO IRRELEVANT AND I S LIABLE TO BE REJECTED BECAUSE ACCORDING TO INVENTORY OF THE CASH PREPARED DURING THE COURSE OF SURVEY EXCESS CASH WAS FOUND IN THE P REMISES OF THE ASSESSEE, THEREFORE, IT HAS TO BE ADDED SEPARATELY ON ACCOUNT OF EXCESS CASH FOUND DURING THE COURSE OF THE SURVEY. MOREOVER, THE CONTENTION RAISED BY THE ASSESSEE WAS NOT SUPPORTED BY ANY EVIDENCE ON RECORD. THE LEARNED CIT(A), THEREFORE, RIGHTLY CONFIRMED THE ADDITION AND DISMISSED THE APPEAL OF THE ASSESS EE. THERE IS NO MERIT IN GROUND NO.1 OF THE APPEAL OF THE ASSESSEE. THE SAME IS ACCORDINGLY DISMISSED. 6. ON GROUND NO.2 OF THE APPEAL, THE ASSESSEE CHALL ENGED ADDITION OF RS.29,50,102/- AS UNEXPLAINED INCOME IN STOCK. THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS IN THE BUSINES S OF TRADING IN GARMENTS. A SURVEY U/S 133A OF THE IT ACT WAS CARRI ED OUT IN THE BUSINESS PREMISES OF THE ASSESSEE ON 14.10.2003. ST OCK WAS FOUND WORTH RS.46,13,618/- ON THE PREMISES WHILE AS PER T HE BOOKS OF ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 4 ACCOUNTS, STOCK WAS VALUED AT RS.16,63,516/-. EXCES S STOCK TO THE EXTENT OF RS.29,50,102/- WAS FOUND WHICH WAS DULY A DMITTED AND CONFIRMED BY THE ASSESSEE, WHO ACCORDINGLY AGREED T O PAY TAX ON THE ADMITTED AMOUNT. HOWEVER, AT THE TIME OF FILING THE RETURN OF INCOME, THE ASSESSEE RETRACTED FROM HIS ADMISSION ON ACCOUN T OF EXCESS STOCK FOUND AND DID NOT OFFER THE SAME FOR TAX. DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE SUBMITTED THAT THERE WAS A COMPUTER PROGRAMME MISTAKE ON ACCOUNT OF WHICH THE CLOSING STOCK GIVEN TO THE SURVEY PARTY WAS NOT CORRECT AND THE W ORKING BASED ON THE SAME WAS ALSO WRONG. THE ASSESSEE SUBMITTED THA T IF THE CLOSING STOCK IS CONSIDERED AS PER THE COMPUTER, IT WOULD R ESULT IN LOSS WHICH IS NOT THEN NATURE OF THIS TRADE. THE AO CRITICALLY EXAMINED THE ASSESSEE'S SUBMISSIONS AND HELD THAT THE ASSESSEE W AS NOT MAINTAINING A PROPER STOCK REGISTER. THIS CAN BE VE RIFIED FROM QUESTION NO. 5 OF THE STATEMENT RECORDED ON 14.10.2 003 WHEREIN, THE ASSESSEE HAD STATED THAT HE IS MAINTAINING CASH BOO K, LEDGER, PURCHASE AND SALE REGISTER, VOUCHERS AND BILL FILES BOTH MANUALLY AND ON THE COMPUTER. THERE WAS NO MENTION OF MAINTENANC E OF STOCK REGISTER. FURTHER THE CLOSING STOCK WAS VERIFIED AF TER CONSIDERING ALL ASPECTS LIKE GOODS RECEIVED BUT BILL WAS NOT RECEIV ED, BILLS RECEIVED BUT GOODS WERE NOT RECEIVED ETC. THE AO ALSO NOTED THAT SINCE THE ASSESSEE WAS MAINTAINING ITS BOOKS OF ACCOUNTS BOTH MANUALLY AS WELL AS ON THE COMPUTER AND ADEQUATE TIME WAS GIVEN TO HIM TO RECONCILE THE FIGURES, EVEN IF THERE WAS A MISTAKE ON COMPUTER, THE MANUAL RECORDS COULD HAVE BEEN SEEN AND STOCK VERIF IED. DESPITE THE FACT THAT THE ASSESSEE HAD SOUGHT TIME DURING THE C OURSE OF SURVEY PROCEEDINGS TO FILE RECONCILIATION IF REQUIRED, NO SUCH RECONCILIATION ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 5 WAS FILED BY HIM. THE AO THEREFORE, CONCLUDED THAT UNDER THE PRETEXT OF COMPUTER PROGRAMME MISTAKE THE ASSESSEE WANTED T O AVOID THE TAX LIABILITY ON EXCESS STOCK FOUND DURING THE SURV EY PROCEEDINGS. HE THEREFORE, PROCEEDED TO ADD THIS AMOUNT AS INVESTMENT FROM UNA CCOUNTED INCOME. THE AO THEN RELIED ON THE JUDGMENT OF THE HON'BLE GUJAR AT HIGH COURT IN THE CASE OF FAKIR MOHAMAD HAJI HASSAN VS CIT AND BR OUGHT TO TAX THE ENTIRE AMOUNT OF RS.29,50,102/- AS DEEMED INCOM E. IN APPEAL BEFORE THE LEARNED CIT(A), THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AO. THE SUM AND SUBSTANCE OF HIS SUBMISSIONS WAS THAT DUE TO MISTAK E IN COMPUTER THE STOCK AS PER THE BOOKS WORKED OUT WAS NOT CORRE CT. IF THE SAME IS CONSIDERED IT WOULD RESULT IN A GROSS LOSS WHICH IS NOT EXPECTED IN THE LINE OF BUSINESS. THE LEARNED COUNSEL FOR THE ASSES SEE REITERATED HIS OBJECTION TO THE RELIANCE PLACED BY THE AO ON THE D ECISION OF THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF FAKIR MOH AMMAD HAJI HASSAN. 7. THE LEARNED CIT(A) CONSIDERING THE EXPLANATION O F THE ASSESSEE CONFIRMED THE ADDITION. HIS FINDINGS IN PA RA 4.4 AND 4.5 ARE REPRODUCED AS UNDER: 4.4. I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS O F THE AUTHORIZED REPRESENTATIVE AND THE ORDER OF THE ASSE SSING OFFICER. THE VALUATION OF STOCK WAS DONE ON THE PRE MISES OF THE APPELLANT. IT WAS DONE IN THE PRESENCE OF TH E APPELLANT WHO HAS SIGNED EVERY PAGE OF INVENTORY. T HE CLOSING STOCK WAS WORKED OUT ON THE BASIS OF THE DE TAILS SUPPLIED BY THE APPELLANT. THE APPELLANT AS PER THE RECORDS MADE NO ATTEMPT TO RECONCILE THE DIFFERENCE IF ANY. THE ASSESSING OFFICER'S OBSERVATIONS THAT RECONCILIATION COULD HAVE BEEN DONE BY THE APPELLAN T WITH THE HELP OF MANUAL BOOKS OF ACCOUNTS IS FAULTLESS. THE ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 6 APPELLANT FAILED TO DO SO. THE PLEA TAKEN BY HIM TH AT HE HAS FILED A LETTER SEEKING TIME TO RECONCILE THE AC COUNTS, CANNOT REALLY BE ACCEPTED. THE LETTER, A COPY OF WH ICH HAS BEEN FILED BEFORE ME IS AN UNDATED APPLICATION WHIC H DOES NOT EVEN BEAR THE STAMP OF THE INCOME-TAX OFFI CE. ITS VERACITY CANNOT BE RELIED UPON. APART FROM TRYI NG TO EXPLAIN THE DISCREPANCY BEING ON ACCOUNT OF COMPUTE R FALLIBILITY THE APPELLANT HAS NOT SUBMITTED ANY EVI DENCE IN SUPPORT OF HIS CLAIM. THE ASSESSING OFFICER WAS THE REFORE, JUSTIFIED IN BRING TO TAXI RS.29,50,102/- AS APPELL ANT'S DEEMED INCOME U/S.69B OF THE INCOME TAXI ACT IN THE CURRENT YEAR. ACCORDINGLY, ADDITION OF RS.29,50,102 /- MADE BY HIM IS CONFIRMED. 4.5. WITH REGARD TO TREATING THE INCOME AS DEEMED INCOME UNDER SECTION 69B OF THE INCOME TAX ACT, THE RE IS MERIT IN THE SUBMISSIONS OF THE APPELLANT. THE BAS IC FACT IS THAT SURVEY WAS CONDUCTED ON THE BUSINESS PREM ISES OF THE APPELLANT. DURING THE COURSE OF SURVEY PROCEEDINGS, STOCK OF MERCHANDISE WAS FOUND IN WHIC H THE APPELLANT HAD BEEN DEALING WITH REGULARLY FOR THE LAST MANY YEARS. THE BOOKS OF COUNTS WHEREIN , THE DETAIL OF SUCH STOCK WAS DEALT WITH W ERE CONSIDERED BY THE SURVEY PARTY. THE DIFFERENCE IN Q UANTITY BETWEEN THE STOCK ENTERED IN THE BOOKS OF ACCOUNTS AND THE STOCK FOUND AT THE BUSINESS PREMISES OF THE APP ELLANT WAS CONSIDERED TO BE ADDITIONAL STOCK. THE SURVEY P ARTY DID NOT DISTINGUISH BETWEEN THE EXCESS STOCK SAID T O HAVE BEEN INVESTED FROM UNDISCLOSED SOURCES AND THE STOC K ENTERED IN THE BOOKS OF ACCOUNTS. THIS WAS SO BECAU SE THE ENTIRE STOCK WAS FROM A COMMON POOL FOUND ON TH E BUSINESS PREMISES OF THE APPELLANT. THEREFORE, A DI RECT NEXUS BETWEEN THE BUSINESS ACTIVITY OF THE APPELLAN T AND THE EXCESS STOCK FOUND DURING THE COURSE OF SURVEY WAS ESTABLISHED. FURTHER NO EVIDENCE HAS BEEN BROUGHT O N RECORD WHICH INDICATES THAT THE APPELLANT HAS ANY O THER SOURCE OF INCOME WHICH HAS BEEN UTILISED BY HIM FOR ACQUIRING THE EXCESS STOCK FOUND DURING THE COURSE OF SURVEY. THE RELIANCE OF THE ASSESSING OFFICER ON TH E DECISION OF THE GUJARAT HIGH COURT IN THE CASE OF F AKIR ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 7 MOHAMMAD HAJI HASSAN IS NOT CORRECT SINCE THE FACTS OF THE CASE ARE CLEARLY DISTINGUISHABLE FROM THE FACTS OF THE CASE OF FAKIR MOHAMMAD HAJI HASSAN. IN THE SAID JUDGEMENT, THE HON'BLE HIGH COURT HAD COMMENTED THA T IT IS NOT THE CASE OF THE APPELLANT THAT HE IS IN THE BUSINESS OF SMUGGLING. IN THE PRESENT CASE, IT IS THE CASE O F THE APPELLANT THAT HE IS IN THE BUSINESS OF TRADING IN GARMENTS AND EXCESS STOCK OF GARMENTS HAS BEEN FOUND AT THE BUSINESS PREMISES OF THE APPELLANT. IN VIEW OF THE ABOVE, I HOLD THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED I N INVOKING THE PROVISIONS OF SECTION 69B IN THE CASE OF THE APPELLANT. THEREFORE, THE AMOUNT DECLARED AS INVEST MENT MADE IN STOCK SHOULD BE BROUGHT TO TAX AS THE BUSIN ESS INCOME OF THE APPELLANT AND NOT AS DEEMED INCOME U/S.69B OF THE INCOME TAX ACT. 8. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND R EFERRED TO THE STATEMENT OF THE ASSESSEE RECORDED DURING THE COURS E OF SURVEY (PB- 17) AND REFERRED TO QUESTION NO.19 AND EXPLAINED TH AT THOUGH THE ASSESSEE ADMITTED THE WORKING OF THE EXCESS STOCK B UT IT WAS EXPLAINED THAT HE WOULD FILE RECONCILIATION STATEME NT WITHIN 3 / 4 DAYS. THE ASSESSEE THEREAFTER FILED LETTER (PB-16) (UNDAT ED) BEFORE THE AO IN WHICH IT WAS EXPLAINED THAT DUE TO COMPUTE PROGR AMME MISTAKE THE SURVEY PARTY HAS NOT TAKEN THE STOCK CORRECTLY AND FURTHER THERE IS A DEFECT IN THE INVENTORY. HE HAS SUBMITTED THAT RE PLY OF THE ASSESSEE WAS NOT PROPERLY APPRECIATED BY THE AO AND THE SAME WAS FURTHER REITERATED BEFORE THE AO IN THE REPLY DATED 21-12-2 006. HE HAS REFERRED TO PB-4 WHICH IS THE TRADING ACCOUNT PREPA RED ON THE DATE OF SURVEY TO SHOW THAT IT DISCLOSES GROSS LOSS WHICH I S NOT POSSIBLE IN THE NATURE OF THE TRADE OF THE ASSESSEE. HE HAS SUBMITT ED THAT THE ASSESSEE PREPARED ANOTHER TRADING ACCOUNT ON THE DA TE OF THE SURVEY ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 8 (PB-5) TO SHOW THAT ACTUAL STOCK SHOULD HAVE BEEN 3 515224. HE HAS SUBMITTED THAT THE AUTHORITIES BELOW SHOULD NOT HAV E PLACED BLIND RELIANCE ON THE STATEMENT OF THE ASSESSEE WHICH WAS RECORDED ON WRONG ASSUMPTION OF FACTS AND RELIED UPON THE DECIS ION OF THE HONBLE CHHATISGARH HIGH COURT IN THE CASE OF ITO VS VIJAY KUMAR KESAR 327 ITR 497 IN WHICH IT WAS HELD THAT THE CONFESSION MADE BY THE ASSESSEE DURING THE SURVEY PROCEEDINGS IS NOT CONCL USIVE AND IT IS OPEN TO THE ASSESSEE TO ESTABLISH BY FILING COGENT EVIDENCE THAT THE SAME WAS NOT TRUE AND CORRECT. HE HAS SUBMITTED THAT THE SAME PRINCIPLE WAS DECIDED BY THE HONBLE SUPREME COURT IN THE CASE OF PULLANGODE RUBBER PRODUCE CO. LTD. VS STATE OF KE RALA, 91 ITR 18. HE HAS SUBMITTED THAT THE ASSESSEE EXPLAINED ALL TH E FACTS CORRECTLY BEFORE THE AUTHORITIES BELOW AND THE CONTENTION OF THE ASSESSEE IS SUPPORTED BY CBDT CIRCULAR WHICH PROHIBITS TAKING O F THE STATEMENT/DISCLOSURE AT THE TIME OF SURVEY OR SEARC H FOR THE PURPOSE OF MAKING ADDITION WITHOUT ANY EVIDENCE OR MATERIAL FOUND DURING THE COURSE OF THE PROCEEDINGS. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE POINTED OUT ABNORMALITY AND ALSO EXPLAINED THE EXCESSIVE STOCK, THEREFORE, ADDITION IS UNJUSTIFIED. 9. ON THE OTHER HAND, THE LEARNED DR RELIED UPON TH E ORDERS OF THE AUTHORITIES BELOW AND REFERRED TO THE STATEMENT OF THE ASSESSEE RECORDED DURING THE COURSE OF SURVEY AND POINTED OU T FROM THE ANSWER TO QUESTION NO.19 THAT THE ASSESSEE ADMITTED STOCK INVENTORY WHICH WAS PREPARED IN THE PREMISES OF THE ASSESSEE WITHOUT OBJECTION FROM THE SIDE OF THE ASSESSEE WHICH WAS A LSO ACCEPTED BY THE ASSESSEE AND THE ASSESSEE EXPLAINED THAT IN CAS E HE WOULD NOT ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 9 FILE ANY RECONCILIATION WITHIN 3/4 DAYS THEN IT WOU LD AMOUNT TO ACCEPTANCE OF THE ADDITION AND HE WOULD PAY THE TAX ES ALSO. THE LEARNED DR SUBMITTED THAT THE ASSESSEE DID NOT FILE ANY DETAILS OF RECONCILIATION BEFORE THE AO WITHIN 3/4 DAYS AS PER THE STATEMENT. HE HAS SUBMITTED THAT THE ASSESSEE DID NOT DISPUTE THE STOCK INVENTORY CORRECTLY PREPARED BY THE SURVEY PARTY AND THAT THE LETTER OF THE ASSESSEE (PB-16) IS UNDATED AND ALSO DID NOT BEAR T HE STAMP OF THE INCOME TAX DEPARTMENT. THEREFORE, THERE IS NO PROOF THAT THE SAME WAS EVEN FILED BEFORE THE AO AT ANY STAGE. THE LEAR NED DR SUBMITTED THAT TILL THE DATE THE ASSESSEE HAS NOT FILED ANY R ECONCILIATION AND EVEN AS PER THE TRADING ACCOUNT PREPARED BY THE ASS ESSEE (PB-5) THERE IS A HUGE DIFFERENCE IN THE STOCK, THEREFORE, THE ASSESSEE FAILED TO EXPLAIN THE EXCESSIVE STOCK THROUGH EVIDENCE OR MATERIAL ON RECORD. HE HAS, THEREFORE, SUBMITTED THAT THE DECISIONS RELIED UPON BY THE ASSESSEE WOULD NOT SUPPORT THE CASE OF THE ASSESSEE AND ARE CLEARLY DISTINGUISHABLE ON FACTS. HE HAS SUBMITTED THAT SIN CE THE ASSESSEE FAILED TO EXPLAIN THE EXCESSIVE STOCK FOUND DURING THE COURSE OF SURVEY, THEREFORE, ADDITION SHOULD BE MAINTAINED. 10. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF THE PARTIES AND DO NOT FIND ANY MERIT IN THIS GROUND OF APPEAL OF THE ASSESSEE. IT IS ADMITTED FACT THAT SURVEY WAS CONDUCTED IN THE PREM ISES OF THE ASSESSEE IN WHICH INVENTORY WAS PREPARED ACCORDING TO WHICH EXCESS STOCK WAS FOUND WHICH WAS ADMITTED AND CONFIRMED BY THE ASSESSEE IN HIS STATEMENT. THE VALUATION OF THE STOCK WAS DO NE IN THE PREMISES OF THE ASSESSEE WHICH WAS NOT DISPUTED BY THE ASSES SEE AT ANY POINT OF TIME. IT IS ALSO ADMITTED FACT THAT THE INVENTOR Y WAS SIGNED BY THE ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 10 ASSESSEE AND THE DETAILS WERE ALSO SUPPLIED TO THE ASSESSEE AND ACCORDINGLY CLOSING STOCK WAS WORKED OUT. THE STATE MENT OF THE ASSESSEE WAS RECORDED ON THE ABOVE POINT AND THE AS SESSEE ADMITTED IN HIS STATEMENT THAT HE HAS VERIFIED THE COMPLETE WORKING OF THE INVENTORY OF THE STOCK WHICH IS PREPARED CORREC TLY AND HE HAS NO OBJECTION TO THE SAME. THE ASSESSEE ONLY PRAYED THA T IN CASE THERE IS ANY MISTAKE IN THE FACTS OR ACCOUNTING OR MISTAKE T HEN HE WOULD EXPLAIN THE SAME WITHIN 3/4 DAYS, OTHERWISE THE SAM E BE TREATED AS EXCESS STOCK FOUND DURING THE COURSE OF SURVEY AND HE WOULD PAY THE TAX THEREON. THEREAFTER, THE ASSESSEE DID NOT FILE ANY RECONCILIATION STATEMENT OF THE STOCK BEFORE THE AO WITHIN 3/4 DAY S. THE ASSESSEE DESPITE HAVING AVAILABILITY OF THE RECORD WITH HIM DID NOT ATTEMPT TO RECONCILE THE EXCESS STOCK AT ANY POINT OF TIME. TH E LEARNED COUNSEL FOR THE ASSESSEE REFERRED TO LETTER (PB-16) FILED B EFORE THE AO, WHICH WAS UNDATED AND THERE IS NO STAMP OF THE REVENUE DE PARTMENT TO PROVE THAT IT WAS FILED AT ANY TIME BEFORE THE AO O R ANY INCOME TAX AUTHORITIES. SAME IS THE POSITION BEFORE US BECAUSE EVEN IN THE PAPER BOOK THE ASSESSEE HAS NOT GIVEN ANY DATE FOR FILING OF THIS LETTER BEFORE THE AO. IT WOULD, THEREFORE, PROVE THAT THE ASSESSEE HAS NO EVIDENCE TO SHOW THAT THE LETTER (PB-16) WAS AT ALL FILED BEFORE THE REVENUE AUTHORITIES AT ANY POINT OF TIME. THEREFORE , NO COGNIZANCE OF THIS LETTER COULD BE TAKEN IN FAVOUR OF THE ASSESSE E. THE ASSESSEE THEREAFTER SUBMITTED THAT DUE TO COMPUTER PROGRAMME MISTAKE EXCESSIVE STOCK STATEMENT WAS TAKEN AND WORKING IS NOT CORRECT. BUT SUCH CONTENTION WAS NOT SUPPORTED BY ANY EVIDENCE. THE CLAIM OF THE ASSESSEE IS INCORRECT ALSO BECAUSE ACCORDING TO TRA DING ACCOUNT PREPARED BY THE ASSESSEE HIMSELF ON THE DATE OF SUR VEY (PB-5), THE ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 11 ASSESSEE ADMITTED THE CLOSING STOCK OF RS.35,15,224 /-. THE SAME WOULD ALSO SUPPORT THE CASE OF THE AO THAT EXCESS S TOCK WAS FOUND DURING THE COURSE OF SURVEY. MOREOVER, THE ASSESSEE FAILED TO ADDUCE ANY EVIDENCE IN SUPPORT OF THE CONTENTION THAT CLOS ING STOCK SHOULD BE WORKED OUT TO RS.35,15,224/-. THE LEARNED COUNSEL F OR THE ASSESSEE RELIED UPON THE DECISION ON THE PROPOSITION THAT CO NFESSION MADE BY THE ASSESSEE DURING THE COURSE OF SURVEY IS NOT CON CLUSIVE AND IT IS OPEN TO ESTABLISH BY FILING COGENT EVIDENCE THAT TH E SAME WAS NOT TRUE AND CORRECT. THERE IS NO DISPUTE ABOUT THE LEGAL PR OPOSITION BUT IN THE CASE OF THE ASSESSEE, THE ASSESSEE FAILED TO ADDUCE ANY COGENT EVIDENCE BEFORE THE AUTHORITIES BELOW TO EXPLAIN TH E EXCESS STOCK OR TO EXPLAIN THAT CONFESSION WAS INCORRECT OR WAS NOT BASED ON CORRECT FACTS. IN THIS CASE, EXCESS STOCK WAS FOUND DURING THE COURSE OF SURVEY WHICH SHALL HAVE TO BE RECONCILED BY THE ASS ESSEE, THEREFORE, CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE IS REJECTED THAT DISCLOSURE SHOULD NOT BE TAKEN DURING THE COURSE OF SURVEY AS PER CBDT CIRCULAR WITHOUT EVIDENCE OR MATERIAL. CONSIDE RING THE FACTS AND CIRCUMSTANCES OF THE CASE IN THE LIGHT OF THE FINDI NGS OF THE AUTHORITIES BELOW, WE ARE OF THE VIEW THAT THE ASSESSEE DESPITE HAVING SUFFICIENT TIME TO RECONCILE THE EXCESSIVE STOCK, THE ASSESSEE FAILED TO EXPLAIN THE EXCESS STOCK FOUND DURING THE COURSE OF SURVEY PROCEEDINGS. THEREFORE, THE AUTHORITIES BELOW WERE JUSTIFIED IN MAKING AND CONFIRMING THE ADDITION. WE, THEREFORE, DO NOT DO N OT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE ON THIS GROUND. THE SAME IS ACCORDINGLY DISMISSED. 11. NO OTHER POINT IS ARGUED OR PRESSED. ITA NO.1417/AHD/2008 SHRI VIPULKUMAR KIRTILAL SHAH VS ITO, WARD 1, ANAND 12 12. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17-06-2011 SD/- SD/- (A. N. PAHUJA) ACCOUNTANT MEMBER (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 17-06-2011 LAKSHMIKANT/ LAKSHMIKANT/ LAKSHMIKANT/ LAKSHMIKANT/- -- - COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER DY. REGISTRAR, ITAT, AHMEDABAD