Karunamayee Medical Stores, South 24 Parganas V. ITO, WD-55(2), KOLKATA, Kolkata

ITA 1857/KOL/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1653 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 10 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 21-06-2017
• Assessment Year: 2006-2007
• Appeal Filed On: 29-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK NATH
• Assessee Lawyers: A K CHAKRABORTY
• Keywords: Revised return; Reason to believe
• Section: 133A; 145; 148; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D, BENCH KOLKATA BEFORE SHRI N. V. VASUDEVAN, JM & DR. A.L.SAINI, AM ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) KARUNAMAYEE MEDICAL STORES VILL & PO. BELSINGHA(BENEPARA), P.S. FALTA, DIST. SOUTH 24 PARGANAS, PIN 743504. VS. I.T.O - WD - 55(2), KOLKATA 54/1, RAFI AHMED KIDWAI ROAD, KOLKATA 700 016. ./ ./PAN/GIR NO. : AAFFK 1845 A ( /APPELLANT ) .. ( / RESPONDENT ) APPELLANT BY : SHRI A. K. CHAKRABORTY, CA RESPONDENT BY : SHRI ALOK NATH, JCIT / DATE OF HEARING : 31/07/2017 /DATE OF PRONOUNCEMENT: 25/08/2017 / O R D E R PER DR. ARJUN LAL SAINI, AM: THE CAPTIONED THREE APPEALS FILED BY THE ASSESSEE, PERTAINING TO ASSESSMENT YEAR 2006-07, 2007-08 & 2009-10, ARE DIRECTED AGAINST THE ORDER PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-XXXVI, KOLKATA DATED 27.06.2014, WHICH IN TURN ARISE OUT OF ASSESSMENT ORDERS PASSED BY THE ASSESSING OFFICER U/S 143(3)/147 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) DATED 29.12.2010. 2. THESE THREE APPEALS FILED BY THE SAME ASSESSEE, FOR ASSESSMENT YEARS 2006- 07, 2007-08 & 2009-10, IDENTICAL ISSUES ARE INVOLVED, THEREFORE, THESE HAVE BEEN CLUBBED AND HEARD TOGETHER AND A CONSOLIDATED ORDER IS BEING PASSED FOR THE SAKE OF CONVENIENCE AND BREVITY. THE ASSESSEES APPEAL IN I.T.A NO.1857/KOL/2014, IN ASSESSMENT YEAR 2006-07, IS TAKEN AS THE LEAD CASE. 3. THE ASSESSEE HAS RAISED, BEFORE US, THE FOLLOWING GROUNDS OF APPEAL FOR ASSESSMENT YEAR 2006-07, WHICH READ AS UNDER: KARUNAMAYEE MEDICAL STORES ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) 2 1. FOR THAT UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) XXXVI, KOLKATA, ACTED UNLAWFULLY IN UPHOLDING THE IMPUGNED ADDITION MADE WITHOUT DEDUCTION THE VALUE OF REJECTED ITEMS INCLUDED IN THE LIST OF CLOSING STOCK AS RESORTED TO BY THE LD. INCOME TAX OFFICER, WARD 55(2), KOLKATA INDULGING IN SPECULATION, SURMISE, SUSPICION AND CONJECTURE AND HIS PURPORTED FINDING ON THAT BEHALF IS ALTOGETHER ARBITRARY, UNWARRANTED AND PERVERSE. 2. FOR THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) XXXVI, KOLKATA FAILED TO APPRECIATE THE MATERIAL FACTS IN UPHOLDING THE ACTION OF THE LD. INCOME TAX OFFICER, WARD 55(2), KOLKATA OF DISALLOWING THE CLAIM OF VALUE OF REJECTED STOCK IN THE SUM OF RS.8,16,755/- WHICH ALSO FORMS A PART OF THE COMPUTERIZED CLOSING STOCK AS ON 31.03.2006 AND THE IMPUGNED ACTION ON THAT BEHALF IS EX- FACIE WRONG, UNREASONABLE AND PERVERSE. 3. FOR THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) XXXVI, KOLKATA MISREAD EVIDENCES, CONSIDERED IMPROPER FACTS, FAILED TO CONSIDER PROPER POSITION IN LAW, MISPLACED ONUS OF PROOF AND CAME TO AN ERRONEOUS FINDING IN UPHOLDING THE ADDITION OF RS.8,16,755/- MADE BY THE LD. INCOME TAX OFFICER, WARD 55(2), KOLKATA DENYING THE BENEFIT OF REJECTED ITEMS IN DETERMINATION OF THE CLOSING STOCK IN THE ASSESSMENT YEAR UNDER DISPUTE WHOLLY RELYING ON A STATEMENT OBTAINED FROM A PARTNER IN COURSE OF SURVEY U/S.133A OF THE LNCOME TAX ACT, 1961. 4. FOR THAT ON A PROPER CONSPECTUS OF MATERIAL ON RECORD, PREPONDERANCE OF PROBABILITIES AND CIRCUMSTANCES ATTENDING THE LD. COMMISSIONER OF LNCOME TAX (APPEALS) XXXVI, KOLKATA OUGHT TO HAVE DELETED THE ENTIRE ADDITION OF RS.8,16,755/- MADE BY THE LD. INCOME TAX OFFICER, WARD 55(2), KOLKATA ON MERITS. 4. ALTHOUGH, THE ASSESSEE, IN THIS APPEAL, HAS RAISED A MULTIPLE GROUND OF APPEAL BUT AT THE TIME OF HEARING THE MAIN GRIEVANCE OF THE ASSESSEE HAS BEEN CONFINED TO THE ISSUE THAT DISALLOWING THE CLAIM OF VALUE OF REJECTED STOCK IN THE SUM OF RS.8,16,765/- WHICH ALSO FORMS A PART OF THE COMPUTERIZED CLOSING STOCK AS ON 31.03.2006 HAS BEEN TAKEN INTO ACCOUNT BY THE ASSESSING OFFICER TO MAKE THE ADDITION BASED ON STATEMENT OBTAINED FROM A PARTNER IN COURSE OF SURVEY U/S133A OF THE I.T ACT, 1961. 4.1. THE BRIEF FACTS QUA THE ISSUE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 23.10.2006 SHOWING A TOTAL INCOME OF RS.65,610/- WHICH WAS DULY PROCESSED U/S KARUNAMAYEE MEDICAL STORES ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) 3 143(1) OF THE I.T ACT, 1961. LATER ON, A SURVEY U/S 133A OF THE ACT WAS CONDUCTED ON 23.03.2009 IN THE BUSINESS PREMISES OF THE ASSESSEE FIRM AND PRINT OUT ACCOUNTS WERE COLLECTED FROM COMPUTERIZED ACCOUNTING PACKAGE OF THE ASSESSEE FIRM. AS PER COMPUTERIZED ACCOUNTS SYSTEM, CLOSING STOCK FOR THE F.Y 2005-06 RELEVANT TO THE ASSESSMENT YEAR 2006-07 WAS RS.36,17,044/-. BUT THE ASSESSEE FIRM HAD SHOWN CLOSING STOCK FOR THE SAID ASSESSMENT YEAR AT RS.6,61,062/- IN ITS AUDITED BALANCE SHEET. THEREFORE, IT WAS OBSERVED BY THE ASSESSING OFFICER THAT THE ASSESSEE FIRM HAS SHOWN LESS CLOSING SOCK AMOUNTING TO RS.29,55,982/- (RS.36,17,044 RS.6,61,062). IN VIEW OF THE ABOVE, THERE WAS REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT TO THE TUNE OF RS.29,55,982/-. THEREFORE, THE ASSESSING OFFICER HAD REOPENED THE ASSESSMENT U/S.147 OF THE ACT. ASSESSEE HAD FILED REVISED RETURN OF INCOME ON 07.07.2009 ACCEPTING THE CLOSING STOCK AT RS.36,17,044/-. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE SUBMITTED THE DETAILS FOR SUNDRY CREDITORS & SUNDRY DEBTORS, REJECTED MEDICINES AND PURCHASES, BANK STATEMENT, BILLS & VOUCHERS IN SUPPORT OF EXPENSES CLAIMED IN THE PROFIT AND LOSS ACCOUNT ETC. DURING THE COURSE OF HEARING BEFORE THE ASSESSING OFFICER, THE ASSESSEE POINTED OUT THAT A LIST OF EXPIRED MEDICINES HAD ALREADY BEEN SUBMITTED BY HIM AND CLAIMED THAT RS.8,16,755/- BEING THE COST OF EXPIRED MEDICINES BE DEDUCTED FROM THE CLOSING STOCK OF RS.36,17,044/-. SHRI SANJOY KUMAR DAS, ONE OF THE WORKING PARTNERS OF THE ASSESSEE FIRM DURING THE COURSE OF SURVEY U/S.133A OF THE ACT WHEREIN HE HAS STATED THAT HE CANNOT CONTRADICT THE FIGURE OF HIS ACCOUNTING PACKAGE. MOREOVER, RS.6,61,062/- WAS SHOWN AS CLOSING STOCK IN THE PROFIT AND LOSS ACCOUNT AS ENCLOSED WITH THE ORIGINAL RETURN OF INCOME. HAD THERE BEEN AN INCLUSION OF RS.8,16,756/-, THE RESULTANT FIGURE WOULD COME TO A NEGATIVE FIGURE, WHICH IS ABSURD. THE ASSESSING OFFICER REJECTED THE CONTENTIONS AND KARUNAMAYEE MEDICAL STORES ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) 4 EXPLANATIONS OF THE ASSESSEE AND DISALLOWED RS.8,16,756/- AS DEDUCTION AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. 4.2. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A) WHO HAS CONFIRMED THE ORDER PASSED BY THE ASSESSING OFFICER. THE LD. CIT(A) OBSERVED THAT IT WAS EVIDENT FROM RECORD, AND IN THIS CASE SURVEY U/S.133A HAD TAKEN PLACE IN THE BUSINESS PREMISES OF THE ASSESSEE. DURING THE COURSE OF SURVEY, EVIDENCE WAS FOUND FROM COMPUTER THAT ASSESSEE HAD SUBSTANTIALLY SUPPRESSED CLOSING STOCK IN THE RETURN OF INCOME FILED. INSTEAD OF CLOSING STOCK OF RS.36,17,044/-, CLOSING STOCK OF RS.6,61,062/- WAS SHOWN IN THE ORIGINAL RETURN. THE SUPPRESSION OF CLOSING STOCK WAS ADMITTED BY MANAGING PARTNER DURING SURVEY. HOWEVER, IN THE REVISED RETURN WHILE CLOSING STOCK WAS SHOWN AS ADMITTED, THE STOCK WAS EFFECTIVELY REDUCED BY CLAIMING EXPIRED MEDICINE OF RS.9,50,020/-. HOWEVER, AS IS EVIDENT FROM RECORD, NO SUCH CLAIM OF EXPIRED MEDICINE WAS EVEN MADE DURING SURVEY, NEITHER ANY SUCH RECORD WAS MAINTAINED OR FOUND DURING SURVEY. FURTHER DURING THE COURSE OF ASSESSMENT OR APPELLATE PROCEEDINGS, THE ASSESSEE HAD NOT BEEN ABLE TO PRODUCE ANY EVIDENT IN SUPPORT OF HIS CLAIM OF EXPIRED MEDICINE. IN NORMAL COURSE OF BUSINESS, EXPIRED MEDICINE IF ANY ARE REIMBURSED BY MANUFACTURING COMPANIES. AS THE ASSESSEE HAD NOT BEEN ABLE TO PRODUCE ANY EVIDENCE, THE ASSESSING OFFICER HAD CORRECTLY TREATED THE CLAIM AS AFTERTHOUGHT AND NOT ACCEPTED ASSESSEES CLAIM. THEREFORE, IN THIS WAY THE LD. CIT(A) HAD CONFIRMED THE ORDER PASSED BY THE ASSESSING OFFICER. 4.3 THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED BEFORE US THAT THE ASSESSEE IS A PARTNERSHIP FIRM AND ENGAGED IN THE BUSINESS OF WHOLESALE OF MEDICINES AT RURAL AREAS, AND FILED ITS RETURN OF INCOME IN THE RELEVANT ASSESSMENT YEAR 2006-07 ON 23/10/2006 KARUNAMAYEE MEDICAL STORES ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) 5 DISCLOSING INCOME OF RS. 65,610/-. A SURVEY U/S.133A OF THE ACT WAS CONDUCTED ON BUSINESS PREMISES OF THE ASSESSEE ON 23/03/2009. DURING THE SURVEY A COMPUTERIZED ACCOUNTING PACKAGE OF THE ASSESSEE WAS IMPOUNDED. AS PER THAT ACCOUNTING PACKAGE, CLOSING STOCK OF THE ASSESSEE FOR THE RELEVANT PREVIOUS YEAR 2005-06 RELEVANT TO THE ASSESSMENT YEAR 2006-07 WAS FOUND TO BE AT RS. 36,17,044/- WHEREAS DISCLOSED CLOSING STOCK AS PER AUDITED ACCOUNTS WAS RS. 6,61,062/- , THAT IS, AS PER THE BALANCE SHEET FILED WITH THE RETURN OF INCOME. THEREAFTER, THE ASSESSING OFFICER ISSUED A NOTICE U/S 148 OF THE ACT, ON THE BELIEF THAT THE INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT TO THE TUNE OF RS. 29,55,982/- ( RS. 36,17,044 RS.6,61,062) BEING THE DIFFERENCE BETWEEN THE VALUE OF CLOSING STOCK FOUND IN THE ACCOUNTING PACKAGE DURING THE COURSE OF THE SURVEY AND CLOSING STOCK DECLARED IN THE AUDITED ACCOUNTS FILED ALONG WITH THE RETURN OF INCOME. THE ASSESSEE ALSO FILED A RETURN OF INCOME IN RESPONSE TO THE NOTICE U/S 148 OF THE ACT DISCLOSING THE INCOME OF RS. 1,56,827/- BUT REVISED THE ACCOUNTS ADMITTING THE CLOSING STOCK OF RS. 36,17,044/-, ULTIMATELY, THE CLOSING STOCK HAD BEEN ACCEPTED BY THE LD. AO. THE ONLY DISPUTED POINT IS THAT THE ASSESSEE CLAIMED EXPIRED/REJECTED MEDICINES TO THE EXTENT OF RS.816,755/-. THE LD. AO NOTED THAT IF THIS FIGURE OF RS.8,16,755/- IS ACCEPTED THEN THE CLOSING STOCK FIGURE WOULD COME TO NEGATIVE. THE ASSESSEE FAILED TO UNDERSTAND WHEN THE ADMITTED STOCK I.E. IN THE REVISED STOCK STATEMENT FILED WITH THE RETURN AND FILED IN RESPONSE TO SECTION 148 OF THE ACT IS RS.36,17,044/- AND ON THIS THERE IS NO POINT OF DISPUTE OF NEGATIVE CLOSING STOCK. THE LD. AO AS WELL AS THE LD. CIT (A) HAS PUT TOTAL EMPHASIS ON THE STATEMENT OF ONE OF THE PARTNERS DURING THE COURSE OF SURVEY WHICH IS WITHOUT ANY BASIS. THE ASSESSEE PRODUCED COMPLETE RECORDS DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND THE LD. AO COULD NOT POINT OUT ANY DEFECT. HERE IT IS PERTINENT TO NOTE THAT EVEN THE BOOKS OF ACCOUNTS ARE NOT REJECTED BY THE LD. ASSESSING OFFICER AND TRADING RESULTS ARE NOT KARUNAMAYEE MEDICAL STORES ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) 6 REJECTED, SO THE ADDITION TO CLOSING STOCK CANNOT BE MADE BY LD. AO IN THE ABSENCE OF REJECTION OF BOOK RESULTS U/S 145 OF THE ACT. SO SUCH ADDITION WITHOUT REJECTING THE BOOK RESULTS OR TRADING RESULTS IS BAD IN LAW. THE LD COUNSEL ALSO RELIED ON THE HON`BLE ITAT JUDGMENT IN ASSESSEE`S OWN CASE ( ON THE SAME IDENTICAL ISSUE),VIDE ITA NO. 1161/KOL/2011, KARUNAMAYEE MEDICAL STORES VS. ITO, A.Y. 2005-06, DATED 30.07.2014, WHEREIN IT WAS HELD, AS FOLLOWS: 4. THE FACTS ARE THAT THE ASSESSEE IS A PARTNERSHIP FIRM AND ENGAGED IN THE BUSINESS WHOLESALE OF MEDICINES, FILED ITS RETURN OF INCOME IN THE RELEVANT AY 2005-06. A SURVEY U/S. 133 OF THE ACT WAS CONDUCTED ON THE BUSINESS PREMISES OF THE ASSESSEE ON 23.03.2009. DURING THE SURVEY A COMPUTERIZED ACCOUNTING PACKAGE OF THE ASSESSEE HAS IMPOUNDED. AS PER THIS ACCOUNTING PACKAGE, CLOSING STOCK OF THE ASSESSEE FOR THE RELEVANT PREVIOUS YEAR 2004-05 RELEVANT TO AY 2005-06, WAS FOUND TO BE AT RS.32,99,702/- WHEREAS DISCLOSED CLOSING STOCK AS PER AUDITED ACCOUNTS WAS AT RS.5,75,000/- AS PER THE BALANCE SHEET FILED WITH THE RETURN OF INCOME. THE AO ISSUED NOTICE U/S. 148 OF THE ACT ON THE BELIEF THAT THE INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT TO THE EXTENT OF RS.2724702/- BEING THE DIFFERENCE BETWEEN THE VALUE OF CLOSINGS STOCK FOUND IN THE ACCOUNTING PACKAGE DURING THE COURSE OF SURVEY AND CLOSING STOCK DECLARED IN THE AUDITED ACCOUNTS FILED ALONG WITH THE RETURN OF INCOME. THE ASSESSEE FILED RETURN OF INCOME IN RESPONSE TO NOTICE U/S. 148 OF THE ACT WITHOUT DISTURBING INCOME BUT REVISED THE ACCOUNTS ADMITTING THE CLOSING STOCK AT RS.32,99,702/-. ULTIMATELY, THIS CLOSING STOCK WAS ACCEPTED BY THE ASSESSING OFFICER. THE ONLY DISPUTED POINT IS THAT THE ASSESSEE CLAIMED EXPIRED/REJECTED MEDICINES TO THE EXTENT OF RS.9,50,420/-. THE AO NOTED THAT IF THIS FIGURE OF RS.9,50,420/- IS TAKEN, THEN THE CLOSING STOCK FIGURE WOULD COME TO NEGATIVE. WE FAIL TO UNDERSTAND WHEN THE ADMITTED STOCK I.E. IN THE REVISED STOCK STATEMENT FILED WITH THE RETURN FILED IN RESPONSE TO SECTION 148 OF THE ACT IS AT RS.32,99,702/- AND ON THIS, THERE IS NO POINT OF DISPUTE, HOW THIS FIGURE WILL NEGATIVE THE CLOSING STOCK. CONSEQUENTLY, THE AO AS WELL AS THE CIT(A) HAS PUT TOTAL EMPHASIS ON THE STATEMENT OF ONE OF THE PARTNERS DURING THE COURSE OF SURVEY, WHICH IS WITHOUT ANY BASIS. THE ASSESSEE PRODUCED COMPLETE RECRODS DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND ASSESSING OFFICER COULD NOT POINT OUT ANY DEFECT. HERE IT IS PERTINENT TO NOTE THAT EVEN THE BOOKS OF ACCOUNTS ARE NOT REJECTED BY AO OR TRADING RESULTS ARE NOT REJECTED AND ONCE THIS IS THE POSITION, THE ADDITION TO CLOSING STOCK CAN BE MADE BY THE ASSESSING OFFICER IN THE ABSENCE OF REJECTION OF BOOK RESULTS U/S. 145 OF THE ACT. IN OUR VIEW, NO SUCH ADDITION WITHOUT REJECTING THE BOOK RESULTS OR TRADING RESULTS CAN BE MADE. EVEN OTHERWISE, SIMPLY ON THE STATEMENT OF ONE OF THE PARTNERS THE ADDITION CANNOT BE BASED WITHOUT ANY COGENT MATERIAL. THE ASSESSEE HAS FILED COMPLETE DETAILS IN RESPECT TO EXPIRED/DAMAGED STOCK OF MEDICINES, WHICH WAS NEVER DENIED BY THE LOWER AUTHORITIES. IN SUCH CIRCUMSTANCES, WE ACCEPT THE CLAIM OF THE ASSESSEE AND DELETE THE ADDITION 4.4. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE HAS SUBMITTED BEFORE US THAT DURING THE COURSE OF SURVEY U/S.133A, THE ASSESSEE HAS ADMITTED MISTAKE IN THE KARUNAMAYEE MEDICAL STORES ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) 7 CLOSING STOCK IN THE DEPOSITION TAKEN BY THE AO IN RESPECT OF ONE OF THE PARTNERS OF THE ASSESSEE FIRM. THE PARTNER HAS CLEARLY STATED ABOUT THE MISTAKE AND HE CANNOT CONTRADICT THE FIGURE OF HIS ACCOUNTING PACKAGE. THEREFORE, THE ASSESSEE HIMSELF HAS AGREED THAT HIS CLOSING STOCK CONTAINS AN ERROR AND THEREFORE, HE DOES NOT CONTRADICT THE FIGURES OF HIS ACCOUNTING PACKAGE AND HENCE THE ADDITION MADE BY THE ASSESSING OFFICER SHOULD SUSTAIN. THIS WAY, THE LD. DR FOR THE REVENUE HAS RELIED ON THE ORDER PASSED BY THE ASSESSING OFFICER. 4.5. HAVING HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD, WE ARE OF THE VIEW THAT IN THIS CASE, THE ASSESSING OFFICER NOTED THAT IF THE FIGURES OF CLOSING STOCK OF RS.8,16,755/- IS ACCEPTED THEN THE CLOSING STOCK FIGURE WOULD COME TO A NEGATIVE FIGURE, WHICH IS NOT BASED ON ANY FACTS. THE ASSESSEE STATED THAT THE ADMITTED STOCK I.E. IN THE REVISED STOCK STATEMENT FILED WITH THE RETURN IN RESPONSE TO SECTION 148 OF THE ACT WAS 36,17,044/- AND ON THIS THERE WAS NO POINT OF DISPUTE OF NEGATIVE CLOSING STOCK. THE LD. AO AS WELL AS THE LD. CIT(A) HAS PUT TOTAL EMPHASIS ON THE STATEMENT OF ONE OF THE PARTNERS DURING THE COURSE OF SURVEY WHICH IS WITHOUT ANY BASIS. THE PARTNER STATED IN HIS STATEMENT THAT HE CANNOT CONTRADICT THE FIGURE OF HIS ACCOUNTING PACKAGE. BUT THE DEPARTMENT DID NOT ASK ANY FURTHER QUESTION OF HIS ACCOUNTING PACKAGE. THE ACCOUNTING PACKAGE INCLUDES THE REJECTED MEDICINES AND OTHER MEDICINES AND REJECTED MEDICINES CANNOT BE EXCLUDED FROM THE CLOSING STOCK, THEREFORE, THE DEPOSITION TAKEN BY THE DEPARTMENT DURING THE SURVEY U/S.133A DOES NOT HAVE ANY EVIDENTIARY VALUE. THE ASSESSEE PRODUCED COMPLETE BOOKS OF ACCOUNTS AND I.T. RETURNS, DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND THE ASSESSING OFFICER COULD NOT POINT OUT ANY DEFECT. THE BOOKS OF ACCOUNTS AND TRADING RESULTS OF THE ASSESSEE WERE NOT REJECTED BY THE ASSESSING OFFICER, THEREFORE, THE ADDITION ON ACCOUNT OF CLOSING STOCK MADE BY THE ASSESSING OFFICER AND CONFIRMED BY KARUNAMAYEE MEDICAL STORES ITA NO.1857 TO 1859/KOL/2014 (A.YS: 2006-07, 2007-08 & 2009-10) 8 THE LD. CIT(A) IS NOT JUSTIFIED AND NEEDS TO BE DELETED. BESIDES, THIS ISSUE IS FULLY COVERED BY THE ASSESSEE`S OWN CASE (SUPRA). THEREFORE, BASED ON THE FACTUAL POSITION EXPLAINED ABOVE, WE DELETE THE ADDITION MADE BY THE ASSESSING OFFICER IN ASSESSMENT YEARS 2006-07, 2007-08 & 2009-10. 4.6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE FOR ASSESSMENT YEARS 2006-07, 2007-08 & 2009-10, ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 25/08/2017. SD/ - ( N. V.VASUDEVAN) SD/ - (DR. A. L. SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA; DATED: 25/08/2017 [RS, SPS] / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT- KARUNAMAYEE MEDICAL STORES 2. / THE RESPONDENT.- I.T.O-WD-55(2), KOLKATA 3. ( ) / THE CIT(A), KOLKATA. 4. / CIT 5. , , / DR, ITAT, KOLKATA 6. / GUARD FILE. //TRUE COPY// BY ORDER SENIOR PRIVATE SECRETARY, HEAD OF OFFICE/D.D.O, I.T.A.T, KOLKATA BENCHES, KOLKATA .