M/s. Kundanlal Jewellers, Ahmedabad V. The Dy.CIT.,Circle-12, Ahmedabad

ITA 3453/AHD/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50506 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 27-07-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 31-12-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUMIR TEKRIWAL
• Assessee Lawyers: G C PIPARA
• Keywords: Unexplained investment; Valuation report

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH, AHMEDABAD BEFORE SHRI D. K. TYAGI, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER I.T.A. NO. 3453/ AHD/2009 (ASSESSMENT YEAR 2005-06) M/S. KUNDANLAL JEWELLERS, 3, ISKON AVENUE, SWASTIK CROSS ROADS, C. G. ROAD, AHMEDABAD VS. DCIT, CIRCLE 10, AHMEDABAD PAN/GIR NO. : AAGFK8555Q (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI G C PIPARA, AR RESPONDENT BY: SHRI SUMIR TEKRIWAL, SR. DR DATE OF HEARING: 27.07.2011 DATE OF PRONOUNCEMENT: 26.08.2011 O R D E R PER SHRI A. K. GARODIA, AM:- THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A) XVI, AHMEDABAD DATED 16.10.2009 FOR THE ASSE SSMENT YEAR 2005- 06. 2. GROUND NO. 4 HAS NOT BEEN PRESSED BY THE LD. A.R . AND HENCE, THE SAME IS REJECTED AS NOT PRESSED. THE REMAINING GRO UNDS OF THE ASSESSEE I.E. GROUNDS NOS. 1, 2 & 3 ARE INTERCONNECTED WHICH ARE AS UNDER: 1. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACT S IN CONFIRMING THE ADDITION OF RS.34,99,926/- MADE BY T HE A.O. ON ACCOUNT OF ALLEGED UNACCOUNTED INVESTMENT IN STOCK ON ACCOUNT OF DISCLOSURE MADE DURING SURVEY WITHOUT APPRECIATION OR CONSIDERATION OF THE FACTS OF THE CASE. IN VIEW OF FACTS, SUBMISSIONS AND EVIDENCES FILED AND MORE PARTICULARLY THE FACT THAT THE I.T.A.NO.3453 /AHD/2009 2 STATEMENT RELIED UPON BY THE A.O. HAVING BEEN RETRA CTED BY THE APPELLANT ON FACTS, THE IMPUGNED ADDITION OF RS.34, 99,926/- REQUIRES TO BE DELETED. 2. THE LEARNED CIT(A) HAS FURTHER ERRED IN LAW AND ON FACTS IN NOT ACCEPTING THE ELABORATE RECONCILIATION OF STOCK FOUND AT THE TIME OF SURVEY AND STOCK AS PER BOOKS OF ACCOUNT. 3. THE LEARNED CIT(A) HAS FURTHER ERRED IN NOT APPR ECIATING THE FACT THAT THE A.O. HAD MECHANICALLY RELIED UPON THE DISCLOSURE MADE IN THE STATEMENT RECORDED AT THE TIME OF SURVE Y WHILE IGNORING THE FACT THAT THE PARTNER OF THE FIRM IN R ESPONSE TO THE QUESTION AS REGARDS ALLEGED DIFFERENCE IN STOCK HAD CATEGORICALLY STATED IN THE SAME STATEMENT THAT THE DIFFERENCE IS ON ACCOUNT OF THE FACT THAT THE BOOKS OF ACCOUNTS ARE NOT COMPLETE. T HE A.O. AND THE LEARNED CIT(A) THUS OUGHT TO HAVE ACCEPTED THE RECO NCILIATION STATEMENT WHICH WAS ALSO DULY SUPPORTED BY EVIDENCE S. 3. THE BRIEF FACTS OF THE CASE ARE THAT A SURVEY AC TION U/S133A WAS CARRIED OUT ON THE BUSINESS PREMISES OF THE ASSESSE E ON 18.02.2005. THE ASSESSEE IS A JEWELLER. AT THE TIME OF SURVEY, EXC ESS STOCK OF RS.34,99,926/- WAS FOUND. WHEN THE ASSESSEE WAS CO NFRONTED ON THIS EXCESS STOCK IN THE COURSE OF SURVEY PROCEEDINGS, T HE PARTNER OF THE ASSESSEE FIRM SHRI SURESH KUNDANLAL LALCHANDANI DIS CLOSED THE SAME AS ADDITIONAL INCOME. THE PARTNER ALSO OFFERED ADDITI ONAL INCOME OF RS.5 LACS ON ACCOUNT OF UNACCOUNTED INVESTMENT IN FURNIT URE, AT THE TIME OF SURVEY. SUBSEQUENTLY, DURING THE ASSESSMENT PROCEE DINGS, THE ASSESSEE TRIED TO PROVE BEFORE THE A.O. THAT IN FACT, THERE IS NO EXCESS STOCK AND UNACCOUNTED INVESTMENT IN FURNITURE AND, THEREFORE, ASSESSEE DID NOT SHOW THE FIGURE AS ITS INCOME IN ITS RETURN OF INCOME. T HE A.O. WAS NOT SATISFIED AND HE MADE ADDITION OF BOTH THESE AMOUNTS OF RS.34 ,99,926/- AND RS.5 LACS TOWARDS UNACCOUNTED INVESTMENT IN STOCK OF JEW ELLER AND FURNITURE RESPECTIVELY. BEING AGGRIEVED, THE ASSESSEE CARRIE D THE MATTER IN APPEAL I.T.A.NO.3453 /AHD/2009 3 BEFORE LD. CIT(A). BEFORE CIT(A), IT WAS SUBMITTED BY THE LD. A.R. THAT ON SUBSEQUENT VERIFICATION OF RECORDS AND ITS INVEN TORY PREPARED BY THE SURVEY PARTY, IT WAS FOUND THAT THE QUANTITY FOUND AS ON THE DATE OF SURVEY TALLY WITH THE BOOKS EXCEPT MINOR DIFFERENCES. IT WAS CLAIMED THAT EXCESS STOCK WAS DETERMINED BY THE SURVEY PARTY ON THE BAS IS OF INCOMPLETE RECORDS AND FOR THIS REASON, IN THE RETURN OF INCOM E FILED FOR THE PRESENT YEAR, NO ADDITIONAL INCOME ON ACCOUNT OF DISCLOSURE MADE DURING THE SURVEY, IS SHOWN. THE ASSESSEE FILED RECONCILIATION STATEMENT OF STOCK BEFORE CIT(A) WHICH IS REPRODUCED BY THE LD. CIT(A) ON PAGE 3-6 OF HIS ORDER. LD. CIT(A) OBTAINED REMAND REPORT FORM THE A.O. WHICH WAS DULY SUBMITTED BY THE A.O. BEFORE THE LD. CIT(A). A COP Y OF THE REMAND REPORT WAS GIVEN BY THE LD. CIT(A) TO THE ASSESSEE FOR HIS COMMENTS. AFTER CONSIDERING THE REMAND REPORT AND THE REJOIND ER OF THE ASSESSEE, LD. CIT(A) HAS DECIDED THE ISSUE AGAINST THE ASSESSEE W ITH REGARD TO THE ADDITION OF RS.34,99,926/- ON ACCOUNT OF EXCESS STO CK. THIS GROUND OF THE ASSESSEE WAS REJECTED. HOWEVER, LD. CIT(A) DELETED THE ADDITION MADE BY THE A.O. OF RS.5 LACS ON ACCOUNT OF INVESTMENT I N FURNITURE. NOW, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US REGARDING T HE ADDITION CONFIRMED BY THE LD. CIT(A) OF RS.34,99,926/- IN RESPECT OF A LLEGED EXCESS STOCK. 4. IT IS SUBMITTED BY THE LD. A.R. OF THE ASSESSEE THAT THE VALUE OF THE PHYSICAL STOCK ON THE DATE OF SURVEY HAS BEEN DETE RMINED BY THE SURVEY TEAM AT RS.2,44,93,800/- ON THE BASIS OF VALUATION REPORT PREPARED BY THE VALUER, COPY OF WHICH IS AVAILABLE ON PAGES 47-60 O F THE PAPER BOOK. IT IS ALSO SUBMITTED THAT THE VALUE OF THE BOOK STOCK OF RS.2,09,93,874/- WAS WORKED OUT ON THE BASIS OF TRADING ACCOUNT AS ON 18 .02.2005 I.E. THE DATE OF SURVEY PREPARED BY A PARTNER OF THE ASSESSEE FIR M SHRI PRAKASHBHAI K LALCHANDANI. HE SUBMITTED COPY OF SUCH TRADING ACC OUNT PREPARED BY THE I.T.A.NO.3453 /AHD/2009 4 PARTNER AND POINTED OUT THAT THERE ARE CERTAIN INHE RENT MISTAKES IN THE TRADING ACCOUNT. HE SUBMITTED THAT IN THIS TRADIN G ACCOUNT, THE VALUE OF THE CLOSING STOCK HAS BEEN WORKED OUT AS BALANCING FIGURE AND TWO FIGURES IN THE SAID TRADING ACCOUNT I.E. GROSS PROFIT OF RS .12,04,643/- AND KHAJARAT (LABOUR CHARGES) OF RS.5 LACS ARE ON ESTIMATE BASIS . IT IS SUBMITTED THAT GROSS PROFIT HAS BEEN WORKED OUT ON THE BASIS OF G P RATE OF 10% WHEREAS LABOUR CHARGES OF RS.5 LACS WAS ESTIMATED ON THE BA SIS OF RS.30/GRAM BUT ACTUAL G P RATE IS MUCH HIGHER FOR THE PRESENT YEAR I.E. ASSESSMENT YEAR 2005-06. HE DREW OUR ATTENTION TO THE TAX AUDIT RE PORT FOR THE PRESENT YEAR AVAILABLE IN THE PAPER BOOK ON PAGES 16-35 AND IN PARTICULAR, OUR ATTENTION WAS DRAWN TO ITEM (A) OF PARA 32 OF FORM 3 CD AS PER WHICH THE AUDITORS HAS WORKED OUT THE GP RATE OF 28.38%. IT IS SUBMITTED THAT IF IN THE TRADING ACCOUNT PREPARED BY THE PARTNER, GP RAT E IS CONSIDERED AS 28.38%, THE AMOUNT OF GROSS PROFIT WILL INCREASE TO RS.34,18,777/- AS AGAINST RS.12,04,643/- AND HENCE, THE GROSS PROFIT AS WELL AS PHYSICAL STOCK AS ON THE DATE OF SURVEY WILL INCREASE BY AN AMOUNT OF RS.22,14,133/-. IT IS FURTHER SUBMITTED THAT FROM THE VALUATION REPORT PREPARED BY THE VALUER AS ON THE DATE OF SURVEY AND AS PER THE VALUATION REPORT AVAILABLE ON PAGES 47-60 OF THE PAPER BOOK, IT CAN BE SEEN THAT THE SAME WAS VALUED AS PER THE PREVAILING RATES OF GOLD AS ON DATE OF SURVEY I.E. 18.02.2005 AND HENCE, THERE WILL BE A DIFFEREN CE IN THE VALUE OF CLOSING STOCK AS PER THE BOOKS OF THE ASSESSEE AND AS PER THE SURVEY TEAM BECAUSE THE SURVEY TEAM HAS WORKED OUT THE VALUE OF STOCK ON MARKET PRICE WHEREAS, THE BOOK STOCK IS AT COST PRICE. HE FURTHER SUBMITTED THAT THE TOTAL VALUE OF THE STOCK AS PER THE VALUER ON THE DATE OF SURVEY OF RS.2,44,93,800/- INCLUDES LABOUR CHARGES AMOUNT OF RS.11,16,263/- WHEREAS, IN THE TRADING ACCOUNT PREPARED BY THE PAR TNER OF THE FIRM, LABOUR I.T.A.NO.3453 /AHD/2009 5 CHARGES HAVE BEEN CONSIDERED AT RS.5 LACS ONLY AND THERE IS DIFFERENCE IN THE VALUE OF THE STOCK AS PER BOOKS OF THE ASSESSEE AND AS PER SURVEY TEAM ON THIS ACCOUNT ALSO BECAUSE EITHER THE AMOUNT OF L ABOUR CHARGES ADDED BY THE GOVERNMENT VALUER SHOULD BE REDUCED SUITABLY IF IT IS FOUND THAT THE LABOUR CHARGES OF RS.5 LACS FOR THE PERIOD UP TO 18 .02.2005 AS CONSIDERED IN THE TRADING ACCOUNT BY THE PARTNER OF THE ASSESS EE FIRM IS CORRECT AND OTHERWISE IF IT IS FOUND THAT THE VALUE OF THE LABO UR CHARGE OF RS.11,16,263/- ADOPTED IN THE DVOS REPORT IS CORRE CT THEN MORE LABOUR CHARGES ARE TO BE DEBITED IN THE TRADING ACCOUNT AS ON 18.02.2005, WHICH IS THE SURVEY DATE AND IT HAS TO BE SUITABLY INCREA SED AND IT WILL RESULT IN INCREASE OF BOOK VALUE OF THE STOCK. IT WAS ALSO S UBMITTED THAT THERE ARE CERTAIN OTHER MISTAKES IN THE TRADING ACCOUNT PREPA RED BY THE PARTNER OF THE ASSESSEE FIRM. IT IS SUBMITTED THAT REGARDING PURCHASE OF GOLD JEWELLERY, THE QUANTITY MENTIONED IN THE INNER SIDE IS RAW GOLD 16.800 KG. AND GOLD JEWELLERY 21.516 KG, TOTAL OF WHICH COMES TO 38.316 KG BUT IN THE OUTER COLUMN, IN THE SAME TRADING ACCOUNT, THE TOTAL QUANTITY OF RAW GOLD AND GOLD JEWELLERY HAS BEEN MENTIONED AS 42.75 6 KG AND VALUE OF SUCH PURCHASE HAD BEEN CONSIDERED AT RS.2,09,24,431 /-. IT WAS FURTHER SUBMITTED THAT FOR THE PURPOSE OF WORKING OUT THE Q UANTITY OF THE BOOK STOCK, IT HAS TO BE SEEN AS TO WHICH QUANTITY/FIGUR E OF PURCHASE OF JEWELLERY IS CORRECT I.E. 38.316 KG. OR 42.756 KG. IT IS SUBMITTED THAT IF IT IS FOUND THAT THE CORRECT PURCHASE QUANTITY IS 42.7 56KG. THEN THERE IS VERY MINOR DIFFERENCE IN QUANTITY OF JEWELLERY AS PER BO OKS AND JEWELLERY FOUND IN THE COURSE OF SURVEY. IT IS SUBMITTED THA T AFTER GIVING EFFECT OF CONVERSION OF RAW GOLD TO GOLD JEWELLERY, THE QUANT ITY OF BOOK STOCK WILL BE AROUND 37.442 KG AND THE QUANTITY OF GOLD JEWELL ERY FOUND IS 38.858 KG. REGARDING THIS SMALL QUANTITY DIFFERENCE ALSO, IT WAS SUBMITTED THAT I.T.A.NO.3453 /AHD/2009 6 FOR THE PURPOSE OF CONVERSION OF RAW GOLD INTO GOLD JEWELLERY, THE ASSESSEE HAS CONSIDERED ONLY AN ESTIMATED INCREASE ON ACCOUNT OF ADDITION OF IMPURITIES TO CONVERT 24 K GOLD I.E. RAW GOLD IN TO 22K, 18K AND 12K GOLD JEWELLERY BUT IN ACTUAL CONVERSION OF SUCH RAW GOLD INTO JEWELLERY GOLD, SOMETIMES, THERE IS EXTRA ADDITION OF IMPURIT IES WHICH RESULTS INTO ADDITIONAL WEIGHT OF GOLD JEWELLERY BUT THE SAME IS NOT ON ACCOUNT OF ANY UNEXPLAINED OR UNDISCLOSED INVESTMENT IN THE STOCK OF JEWELLERY. IT WAS HIS SUBMISSION THAT BECAUSE OF THESE FACTORS, THE I SSUE SHOULD GO BACK TO THE FILE OF THE A.O. FOR A FRESH DECISION AFTER EXA MINING THESE CONTENTIONS OF THE ASSESSEE. 5. AS AGAINST THIS, LD. D.R. OF THE REVENUE SUPPORT ED THE ORDERS OF AUTHORITIES BELOW. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW. WE FIND THAT THE LD. CIT(A) HAS WORKED OUT THE QUANTITY OF EXCESS STOCK FOUND AT 36.461 KG. AND IN THIS WORKING OF LD. CIT(A), THE Q UANTITY OF GOLD PURCHASED HAD BEEN CONSIDERED AS 16.8 KG. RAW GOLD AND 21.516 KG. GOLD JEWELLERY TOTAL 38,316 KG., WHEREAS IN THE TRADING ACCOUNT PREPARED BY THE PARTNER OF THE ASSESSEE AT THE TIME OF SURVEY ON TH E BASIS OF WHICH THE VALUE OF EXCESS STOCK HAS BEEN WORKED OUT, THE QUAN TITY IN THE INNER COLUMN IS THE SAME AS NOTED BY THE LD. CIT(A) BUT T HE QUANTITY IN THE OUTER COLUMN IS 42.756 KG., WHICH IS MORE BY 4.440 KG. THERE IS NO COMMENT OF LD. CIT(A) ON THIS ASPECT AS TO HOW THE QUANTITY IN THE INNER COLUMN IS CORRECT AND NOT IN OUTER COLUMN. WE FIND THAT ON PAGE 13 OF THE ORDER OF CIT(A), LD. CIT(A) HAS WORKED OUT THE CONVERTED RAW GOLD INTO 22K GOLD JEWELLERY AND IN THE PROCESS, HE HAS CONSIDERED THE OPENING STOCK OF RAW GOLD AT 6.22 KG, PURCHASE OF RAW GOLD 16.8KG, SALE OF RAW I.T.A.NO.3453 /AHD/2009 7 GOLD 10.555KG AND IN THIS MANNER, HE WORKED OUT THE BALANCE OF RAW GOLD AT 12.467 KG AND THE SAME WAS CONVERTED INTO 22K GO LD JEWELLERY OF 13.6 KG. IT WAS THE SUBMISSION OF THE LD. A.R. OF THE A SSESSEE THAT THERE WAS OPENING STOCK AND PURCHASE OF RAW GOLD BUT THERE WA S SALE OF RAW GOLD OF VERY SMALL QUANTITY OF ONLY 174.46 GMS. AND HENCE, THE QUANTITY OF OPENING STOCK AND PURCHASE OF RAW GOLD SHOULD BE CO NVERTED INTO 22K GOLD JEWELLERY AFTER REDUCING ONLY 175 GMS SALE AND IF THIS IS DONE, THE INCREASE IN QUANTITY OF BOOK STOCK OF GOLD JEWELLER Y WILL BE MORE THEN WHAT HAS BEEN WORKED OUT BY THE CIT(A). WE FIND TH AT ON THESE TWO ASPECTS, THERE IS NO FINDING OF LD. CIT(A) AND HENC E, THE ISSUE IS REQUIRED TO BE RESTORED BACK TO THE FILE OF THE A.O. TO CONS IDER AND DECIDE THE VERACITY OF THE CONTENTIONS OF THE ASSESSEE ON THES E TWO ASPECTS. MOREOVER, THE VALUE OF EXCESS STOCK FOUND AT THE TI ME OF SURVEY HAS BEEN WORKED OUT ON THE BASIS OF VALUATION OF STOCK FOUND AT THE TIME OF SURVEY AS PER THE GOVERNMENT VALUER AND THE VALUE OF BOOK STOCK AS PER THE TRADING ACCOUNT AS ON 18.02.2005 PREPARED BY THE PA RTNER OF THE ASSESSEE FIRM BUT LD. A.R. HAS POINTED OUT TWO MISTAKES IN S UCH TRADING ACCOUNT AND IF THE CONTENTION OF THE ASSESSEE ARE FOUND TO BE CORRECT, IT WILL RESULT INTO INCREASE IN THE VALUE OF BOOK STOCK ON THE DAT E OF SURVEY AS PER THE TRADING ACCOUNT TO BE PREPARED AFTER REMOVING THE M ISTAKES IN THE TRADING ACCOUNT ORIGINALLY PREPARED BY A PARTNER OF THE FIR M. THE TWO MISTAKES WHICH ARE POINTED OUT BEFORE US ARE REGARDING THE T WO ESTIMATED FIGURES OF GROSS PROFIT @ 10% OF THE SALE VALUE AND LABOUR CHA RGES @ RS.30/GRAM WHEREAS THE ACTUAL GP FOR THE PRESENT YEAR HAS BEEN REPORTED BY THE AUDITORS OF THE ASSESSEE FIRM @ 28.38% AND LABOUR C HARGES CONSIDERED BY THE SURVEY TEAM IS RS.11.16 LACS AND THE LABOUR CHA RGES DEBITED BY THE ASSESSEE IN THE P & L ACCOUNT FOR THE WHOLE YEAR IS RS.9.44 LACS. HENCE, I.T.A.NO.3453 /AHD/2009 8 EVEN IF WE GO BY THE VALUE OF THE BOOK STOCK AS PER TRADING ACCOUNT ON THE DATE OF SURVEY, IT HAS TO BE REASONABLY CORRECT AND TWO ESTIMATED FIGURES OF GROSS PROFIT AND LABOUR CHARGES HAS TO BE ADOPTE D CORRECTLY BY MAKING A PROPER AND CORRECT ESTIMATE AND IT MAY RESULT INT O HIGHER VALUE OF THE BOOK STOCK ON THE DATE OF SURVEY. THIS CLAIM IS AL SO REQUIRED TO BE EXAMINED AS TO WHAT WAS THE DIFFERENCE IN THE VALUE OF CLOSING STOCK WORKED OUT BY THE SURVEY TEAM ON THIS ACCOUNT ALSO THAT THE BOOK STOCK IS ON THE BASIS OF COST PRICE WHEREAS, THE VALUE OF ST OCK WORKED OUT BY THE SURVEY TEAM IS ON THE BASIS OF MARKET PRICE. IF IT IS FOUND THAT THE RATES OF GOLD HAS GONE UP DURING THIS PERIOD THEN THE IMPACT OF SUCH INCREASE IN MARKET PRICE AS AGAINST COST PRICE OF THE ASSESSEE HAS TO BE CONSIDERED BECAUSE THE INCREASE IN VALUE OF STOCK ON ACCOUNT O F INCREASE IN PRICE CANNOT BE CONSIDERED AS UNEXPLAINED INVESTMENT IN S TOCK. THE QUANTITATIVE RECONCILIATION OF THE ASSESSEE IS ALSO REQUIRED TO BE FURTHER EXAMINED BY FINDING OUT THE CORRECT WEIGHT OF PURCH ASE OF RAW GOLD AND GOLD JEWELLERY OF RS.2,09,24,431/- AS TO WHETHER TH E SAME IS 42.756 KG AS STATED IN THE OUTER COLUMN OF TRADING ACCOUNT PREPA RED BY A PARTNER OF THE ASSESSEE FIRM OR WHETHER IT IS 38.316 KG. AS PER TH E QUANTITY APPEARING IN THE INNER COLUMN OF THE SAME TRADING ACCOUNT WHICH IS ADOPTED BY THE LD. CIT(A) ALSO FOR THE PURPOSE OF WORKING OUT QUANTITY OF EXCESS STOCK FOUND. THE INCREASE IN THE BOOK STOCK QUANTITY ON ACCOUNT OF CONVERSION OF RAW GOLD INTO GOLD JEWELLERY, SHOULD ALSO BE WOR KED OUT PROPERLY AFTER EXAMINING AS TO WHETHER THERE IS ANY SALE OF RAW GO LD OR NOT AND WHAT SHOULD BE THE CORRECT IMPACT ON THE QUANTITY ON ACC OUNT OF CONVERSION OF RAW GOLD INTO JEWELLERY GOLD. IF THE ESTIMATED DIF FERENCE IN THE QUANTITY OF BOOK STOCK AND THE STOCK FOUND AT THE TIME OF SU RVEY IS VERY MARGINAL, THEN ALSO, NO ADDITION IS CALLED FOR ON THIS ACCOUN T BECAUSE MINOR I.T.A.NO.3453 /AHD/2009 9 DIFFERENCES CAN BE THERE ON ACCOUNT OF CONVERSION O F RAW GOLD INTO JEWELLERY GOLD BECAUSE THE INCREASE ON THIS ACCOUNT IS CONSIDERED ON THE BASIS OF ESTIMATED QUANTITY OF IMPURITIES TO BE ADD ED AS PER THE NORMS FOR CONVERSION OF 24K GOLD TO 22K AND 18K ETC. BUT THER E MAY BE CERTAIN EXTRA IMPURITIES IN ACTUAL PRACTICE AND, THEREFORE, MARGINAL DIFFERENCE IN THE QUANTITY UNDER THESE FACTS, MAY BE CONSIDERED A S REASONABLE AND EXPLAINED. IN VIEW OF THESE DISCUSSIONS, WE FEEL T HAT THE ENTIRE MATTER SHOULD GO BACK TO THE FILE OF THE A.O. FOR A FRESH DECISION AND HENCE, WE SET ASIDE THE ORDER OF LD. CIT(A) ON THIS ISSUE AND RESTORE THE MATTER BACK TO THE FILE OF THE A.O. FOR A FRESH DECISION IN TH E LIGHT OF OUR ABOVE DISCUSSION AFTER PROVIDING REASONABLE OPPORTUNITY O F BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, GROUNDS NOS. 1, 2 & 3 OF THE ASSE SSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, APPEAL OF THE ASSESSEE STANDS PAR TLY ALLOWED FOR STATISTICAL PURPOSES. 9. ORDER PRONOUNCED IN THE OPEN COURT ON 26 AUG., 2 011. SD/- SD/- (D. K. TYAGI) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED :26.9.11 2011 SP COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD 6. THE GUARD FILE /TRUE COPY/ I.T.A.NO.3453 /AHD/2009 10 1. DATE OF DICTATION. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S. 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. ..