The ACIT, 5(1), Indore V. Smt. Chandrakanta Neema, Indore

ITA 484/IND/2010

• Counselvise Citation: 48422714 RSA 2010
• Duration Of Justice: 1 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 14-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A DEWAN
• Assessee Lawyers: KAMLESH JAIN
• Keywords: Unexplained investment

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.484/IND/2010 A.Y. 2007-08 ASSTT. COMMR. OF INCOME TAX 5(1), INDORE ... APPELLANT VS SMT CHANDRAKANTA NEEMA, PROP M/S PANNALAL VITHALDAS, 70, SUBHASH CHOWK, SANAWAD ... RESPONDENT PAN AEAPS-5394H DEPARTMENT BY : SHRI A. DEWAN, SR. DR ASSESSEE BY : SHRI KAMLESH JAIN, ADVOCATE DATE OF HEARING : 09.11.2011 DATE OF PRONOUNCEMENT : 09.11.2011 O R D E R PER JOGINDER SINGH THE REVENUE IS AGGRIEVED BY THE ORDER DATED 29/03/ 2010 PASSED BY THE LD CIT (A), II INDORE ON THE GROUND T HAT ON THE 2 FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD F IRST APPELLATE AUTHORITY ERRED IN HOLDING THAT THERE BEING NO DISP UTE SO FAR AS EXCESS QUANTITY OF STOCK FOUND DURING THE COURSE O F SURVEY BY WEIGHT VIS-A-VIS THE OPENING STOCK ADJUSTED WITH TH E QUANTITY OF PURCHASES AND SALE AND THE RATE APPLIED TO ARRIVE AT ACCESS STOCK AT 12000 PER KG AND THE AMOUNT OFFERED BY THE ASSESSEE AT RS. 15,51,804/- FOR THIS EXCESS WEIGHT OF 129.31 7 KG. 2) DURING HEARING OF THIS APPEAL THE LD. SENIOR DR ADVANCED HIS ARGUMENT WHICH IS IDENTICAL TO THE GROUND RAISE D BY DEFENDING THE ASSESSMENT ORDER ON THE OTHER HAND TH E LD. COUNSEL FOR THE ASSESSEE SUPPORTED THE IMPUGNED ORD ER . 3) WE HAVE PERUSED THE RECORD AND CONSIDERED THE RESPECTIVE SUBMISSIONS MADE BEFORE US. THE FACTS IN BRIEF ARE THAT THE ASSESSEE DERIVES INCOME FROM PURCHASE AND SALE OF SILVER JEWELLERY RENTAL INCOME AS WELL AS INCOME FR OM AGRICULTURE. A SURVEY U/S 133 A OF THE ACT WAS COND UCTED AT THE BUSINESS PREMISES OF THE ASSESSEE ON 12.09.2006 WHE REIN INVENTORY OF STOCK AND CASH WAS PREPARED LEADING TO DETERMINATION OF EXCESS STOCK AT RS. 26,50,203/- AL ONGWITH 3 EXCESS CASH OF RS. 3,50,007/- WHICH WAS ADMITTED AS UNDISCLOSED INCOME BY THE ASSESSEE, IN HER STATEMEN T RECORDED BY THE CONCERNED OFFICER. HOWEVER, IN ITS RETURN/COMPUTATION OF INCOME THE ASSESSEE OFFERED V ALUE OF SURRENDERED STOCK OF RS. 15.51,804/- AGAINST ADDITI ONAL INCOME FOR SUCH EXCESS STOCK ADMITTED AT RS. 26,50,203/-. THE STAND OF THE ASSESSEE WAS THAT THERE WAS NO DISPUTE IN RESPE CT OF EXCESS WEIGHT OF STOCK FOUND AND THE VALUATION DONE AT MARKET RATE IGNORING THE VALUE OF BASE STOCK. THUS THE VA LUE OF EXCESS STOCK WAS CLAIMED TO BE WORKED OUT AT RS. 15,51,804 /-, HOWEVER, THE ASSESSING OFFICER MADE AN ADDITION OF RS. 10.98,399/-, BEING THE DIFFERENCE BETWEEN THE VALUE OF EXCESS STOCK SURRENDER DURING SURVEY AND RETURNED AS INCOM E. 4) ON APPEAL BEFORE THE LD. CIT (A) IT WAS CLAIMED BY THE ASSESSEE THAT THE EXPLANATION AND THE SUBMISSIONS M ADE DURING ASSESSMENT PROCEEDING NOT WERE PROPERLY APPR ECIATED. THE LD. CIT(A) DELETED THE ADDITION WHICH IS UNDER CHALLENGE BEFORE US. IF THE TOTALITY OF FACTS AVAILABLE ON RE CORD ARE ANALYSED WE FIND THAT THE VALUE OF EXCESS STOCK WAS 4 DETERMINED, DURING SURVEY, ON THE VALUE OF OPENING STOCK + PURCHASES EFFECTED TILL THE DATE OF SURVEY LESS SAL ES ADJUSTED FOR THE COMPONENT OF GROSS PROFIT . THE WEIGHT OF THE STOCK FOUND WAS 378.395 KG AND VALUATION WAS DONE @ RS.12 00 PER KG AT RS. 45,40,743/-. SO FAR AS EXCESS QUANTITY OF STOCK, BY WEIGHT, DURING SURVEY, IS CONCERNED, THERE IS NO DI SPUTE CONSEQUENTLY THE APPRECIATION IN VALUE OF OPENING S TOCK CANNOT BE TAXED AS UNEXPLAINED INVESTMENT, THEREFORE, WE F IND NO INFIRMITY IN THE CONCLUSION DRAWN IN THE IMPUGNED ORDER IN DELETING THE ADDITION OF RS. 10,98,399/- . IT IS AF FIRMED. FINALLY THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE PRESENCE OF LD. REPRESENTATIVES FROM THE BOTH SIDES AT THE CONCLUSION OF THE HEARING IN OPEN COURT. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 09.11.2011 5 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE