SHEELA SINGH, DARBHANGA V. ACIT, CIRCLE-3, DARBHANGA

ITA 29/PAT/2020

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 4378 (ITAT-PATNA)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2003-2004
• Appeal Filed On: 16-03-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K N PRASAD
• Keywords: Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL P A TNA SMC BENCH BEFORE SHRI S ANJAY G ARG , JUDICIAL MEMBER . / ITA NO. 29 /PAT / 20 2 0 ASSESSMENT YEAR: 20 03 - 04 SHEELA SINGH R.S ENTERPRISES, BENTA ROAD, LAHERIASARAI, DARBHANGA - 846001 [ PAN NO. A IUPS2612J ] / V/S . A.C.I.T, CIRCLE - 3, DARBHANGA / APPELLANT .. / RESPONDENT HEARING THROUGH VIDEO CONFERENCING / BY APPELLANT SHRI K.N. PRASAD, AR / BY RESPONDENT SHRI AJAY KUMAR, ADDL. CIT - SR - DR / DATE OF HEARING 2 1 - 0 1 - 20 2 1 / DATE OF PRONOUNCEMENT 10 - 02 - 20 2 1 / O R D E R TH E PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGAINST THE ORDER DATED 17.01.2020 OF THE COMMISSIONER OF INCOME - TAX (APPEALS) , MUZZAFARPUR [HEREINAFTER REFERRED TO AS CIT(A)] . THE ASSESSEE HAS CONTESTED THE CONFIRMATION OF ADDITION OF RS. 15,25,54 4/ - MADE BY THE LD. ASSESSING OFFICER ( HEREINAFTER REFERRED TO AS LD.AO ) ON ACCOUNT OF ALLEGED EXCESS STOCK FOUND DURING THE SURVEY OPERATION AT THE PREMISES OF THE ASSESSEE. 2. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THERE WAS NO EXCESS STOCK FOUND DURING THE SURVEY OPERATION /ACTION . T HAT THE ADDITION HAS BEEN MADE ONLY ON ACCOUNT OF VARIATION IN METHOD OF VALUATION OF STOCK ADOPTED BY THE LD.AO AS AGAINST THE METHOD ADOPTED BY THE ASSESSEE . THE LD. AO VALUED THE STOCK ITA NO. 29 /PAT/2020 AY 20 03 - 04 SHEELA SINGH PAGE 2 ON THE BASIS OF MRP (MA XIMUM RETAIL PRICE) WHEREAS THE ASSESSEE HAS VALUED THE STOCK AT THE SALE VALUE TO SEMI WHOLESALERS . FURTHER THE LD. AO HAD TAKEN INTO ACCOUNT TH E STOCK, WHICH WAS IN TRANSIT AND WAS LYING WITH TRANSPORT ER . HOWEVER , THE PHYSICAL STOCK FOUND DURING THE SURVEY OPERATION/ACTION WAS TALLIED WITH THE STOCK REGISTER MAINTAINED BY THE ASSESSEE AND NO DIFFERENCE WAS NOTED . THE LD. DR HAS RELIED UPON THE FINDINGS OF THE LOWER AUTHORITIES . H OWEVER, HE COULD NOT REBUT THE ABOVE PLEA OF THE ASSESSEE THAT THERE WAS NO DIFFERENCE FOUND IN THE ACTUAL PHYSICAL STOCK FOUND IN THE PREMISES OF THE ASSESSEE AND EVEN THAT THERE WAS NO VARIATION IN QUANTITY AND QUALITY OF THE GOODS . T HAT THE ONLY DIFFERENCE WAS REGARDING THE VALUATION OF THE GOODS /STOCKS . T HE LD. AO HAD VALUED THE STOCK ON THE BASIS OF MRP. AS PER THE LD. COUNSELS SUBMISSION , THERE WAS DIFFERENCE OF ABOUT 40% BETWEEN MRP AND VALUE OF STOCK AT WHICH THE ASSESSEE SOLD THE GOODS TO SEMI WHOLES ALERS . 3 . I HAVE HEARD THE RIVAL CONTENTIONS AND GONE THROUGH THE ASSESSMENT ORDER AS WELL AS THE ORDER OF THE LD. CIT(A). I HAVE CONSIDERED THE ABOVE SUBMISSIONS OF THE LD. C OUNSEL FOR THE ASSESSEE. SINCE IT IS AN ADMITTED FACT THAT THERE WAS NO VARIATIO N OR DIFFERENCE FOUND DURING THE SURVEY ACTION EITHER IN THE QUANTITY OR QUALITY OF THE GOODS AND SINCE THE VARIATION WAS ON ACCOUNT OF THE METHOD OF VALUATION OF STOCK, I AM OF THE VIEW THAT THIS CAN BE CONSIDERED A S STOCK A CASE OF EXCESS STOCK. THERE FORE, THE IMPUGNED ADDITION IS NOT JUSTIFIED AND THE SAME IS ACCORDINGLY SET ASIDE. IN THE RESULT, ASSESSEES APPEAL STANDS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 10 / 0 2 / 20 2 1 SD/ - (S ANJAY GAR G ) JUDICIAL MEM BER - 10 /02/2021 / KOLKATA * * PP /SR.PS / COPY OF ORDER FORWARDED TO: - 1. /APPELLANT - SHEELA SINGH R.S ENTERPRISES, BENTA ROAD, LAHERIASARAI, DARBHANGA - 846001 (BIHAR). 2. /RESPONDENT - THE ASSTT. COMMISSIONER OF INCOME - TAX, CIR - 3, DARBHNAGA. 3. / CONCERNED CIT 4. - / CIT (A) 5. , / DR, ITAT, KOLKATA 6. / GUARD FILE . BY ORDER/ , , SENIOR PRIVATE SECRETARY/ASSTT. REGIST RAR