Shri Ramesh M.Shah, Ahmedabad V. The Dy.CIT.,Circle-12, Ahmedabad

ITSSA 157/AHD/2009

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8295 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 8 month(s) 8 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 29-07-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 18-07-2011
• Assessment Year: misc
• Appeal Filed On: 20-11-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KARTAR SINGH
• Assessee Lawyers: J S VERMA
• Keywords: Unexplained investment; Gift; Retrospective amendment; Block assessment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH A BEFORE SHRI MUKUL KUMAR SHRAWATS, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER I.T.(SS) NO. NO. 157/ AHD/2009 (BLOCK ASSESSMENT PERIOD 1.4.1989 TO 31.03.1999 AND 1.4.1999 TO 21.12.1999) RAMESH M SHAH, PROP. ANKIT STEELS, 4, DAVE COMPLEX, NEAR CHAKUDIA MAHADEV, RAKHIAL, AHMEDABAD VS. DCIT, CIRCLE 12, AHMEDABAD I.T.(SS) NO. NO. 161/ AHD/2009 (BLOCK ASSESSMENT PERIOD 1.4.1989 TO 21.12.1999) DCIT, CIRCLE 12, AHMEDABAD VS. RAMESH M SHAH, PROP. ANKIT STEELS, 4, DAVE COMPLEX, NEAR CHAKUDIA MAHADEV, RAKHIAL, AHMEDABAD PAN/GIR NO. : AQLPS8773K (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI J. S. VERMA, AR RESPONDENT BY: SHRI KARTAR SINGH, CIT DR O R D E R PER SHRI A. K. GARODIA, AM:- THESE ARE CROSS APPEALS FILED BY THE ASSESSEE AND THE REVENUE WHICH ARE DIRECTED AGAINST THE ORDER OF CIT(A) XX, AHMEDA BAD DATED 17,.08.2009 FOR THE BLOCK PERIOD FORM 01.04.1989 TO 21.12.1999. FOR THE SAKE OF CONVENIENCE, BOTH THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE . 2. THE GROUNDS RAISED BY THE REVENUE ARE AS UNDER: I.T.A.NO. 157 & 161/AHD/2009 2 1, THE LD. CIT(A)-XX, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION ON ACCOUNT OF UNACCOUNTED PURCHASES TO THE EXTENT OF RS,2,62,361/- AND ADDITION ON ACCOUNT OF UNACCOUNTED SALES TO THE EXTENT OF RS.18,75,642/-, WITHOUT PROPERLY A PPRECIATING THE FACTS OF THE CASE AND THE MATERIAL BROUGHT ON RECORD BY T HE AO. 1.2 IN DOING SO, THE LD. CIT(A) HAS ERRED IN LAW AN D ON FACTS IN ACCEPTING THE EXPLANATION OF THE ASSESSES, WITHOUT PROPERLY APPRECIATING THAT THE SAID ADDITIONS WERE MADE BY T HE AO ON THE BASIS OF THE SEIZED UGHARANI BOOK WHICH REFLECTED THE BUS INESS TRANSACTIONS OF THE ASSESSEE INCLUDING THE NAMES AND AMOUNTS IN RESPECT OF VARIOUS PERSONS. 1.3 IN DOING SO, THE LD. CIT(A) HAS ERRED IN LA W AND ON FACTS IN ACCEPTING THE CLAIM OF THE ASSESSEE THAT CERTAIN EN TRIES WERE MADE IN THE NAMES OF WRONG PERSONS AND IN SOME CASES, THE TRANS ACTIONS PERTAINING TO A PARTY WERE POSTED TO THE ACCOUNT OF SOME OTHER PARTY, WITHOUT PROPERLY APPRECIATING THE PROVISIONS OF SECTION 292 C OF THE ACT INSERTED WITH RETROSPECTIVE EFFECT FROM 01.10.1975, ACCORDING TO WHICH THE CONTENTS OF THE SAID SEIZED MATERIAL WERE TO BE ACCEPTED AS TRUE IN THE ABSENCE OF ANY EVIDENCE FURNISHED BY THE AS SESSEE TO REBUT THE SAID PRESUMPTION. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT (A) OUGHT TO HAVE UPHELD THE ORDER OF THE A.O, 3. IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE C1T(A) BE SET ASIDE AND THAT OF A.O. BE RESTORED TO THE ABOVE EXTENT. 3. REGARDING THE GROUNDS RAISED BY THE ASSESSEE, IT WAS POINTED OUT BY THE BENCH TO THE LD. A.R. THAT THE GROUNDS ARE NOT HAPPILY WORDED AND IN REPLY IT WAS SUBMITTED BY THE LD. A.R. OF THE ASSES SEE THAT RELIEF CLAIMED/PRAYED BY THE ASSESSEE MAY BE TREATED AS TH E GROUNDS RAISED BY THE ASSESSEE. THE SAME ARE AS UNDER: (1) YEAR-WISE ADDITION OF RS. 11,61,192 EXCLUDING T HE INCOME MENTIONED IN FORM NO. 2B FOR BLOCK ASSESSMENT BREAK -UP OF WHICH IS AS UNDER BE DROPPED: I.T.A.NO. 157 & 161/AHD/2009 3 AY. AMOUNT ( RS. ) AMOUNT OF UNDISCLOSED INCOME AS UPHELD BY THE CIT(A)-XX.- 1997 - 98 4,50,550 4,20,074 -- UNRECORDED SALES 30,476 - UNRECORDED PURCHASE 2000-01 7,10,642 5,91,642 - UNACCOUNTED GROSS PROFIT FOR DISCREPANCY IN STOCK 1,19,000 - UNEXPLAINED INVESTMENT IN VALUABLE HOUSEHOLD ITEMS (2) AS PER THE NOTICE OF DEMAND DATED 30/09/09 U/S 156 OF THE INCOME TAX ACT, 1961, AFTER GIVING EFFECT TO THE CIT(A)'S ORDE R U/S 250 OF THE ACT AND TAKING INTO CONSIDERATION THE SUM OF RS. 9,50,390 ALREADY PAID BY THE APPELLANT, THE NOTICE U/S 158BFA(3) R.W.S. 158BFA(2 ) OF THE INCOME TAX ACT, 1961 FOR PENALTY PROCEEDINGS BE STAYED AND/OR THE SAME MAY BE QUASHED/CANCELLED. (3) ANY OTHER RELIEF WHICH YOUR HONOUR MAY THINK FI T IN FAVOUR OF ASSESSEE BE GRANTED. 4. IT WAS SUBMITTED BY THE LD. A.R. THAT THE RELIEF CLAIMED BY THE ASSESSEE IN RELATION TO ADDITION CONFIRMED BY LD. CIT(A) OF RS.4,50,550/- IN RESPECT OF UNRECORDED SALES AND UNRECORDED PURCHASE FOR THE ASSESSMENT YEAR 1997- 98 IS NOT PRESSED. HENCE, THIS PART OF THE APPEAL OF THE ASSESSEE IS REJECTED AS NOT PRESSED. 5. IT WAS ALSO SUBMITTED BY HIM THAT THE GROUNDS RA ISED BY THE ASSESSEE IN RESPECT OF ADDITION MADE BY THE A.O. AND CONFIRMED BY THE LD. CIT(A) OF RS.7,10,6421/- IN RESPECT OF ALLEGED UNACCOUNTED GP FOR DISCREPANCY IN STOCK TO THE EXTENT OF RS.5,91,642/- AND IN RESPECT OF AL LEGED UNEXPLAINED INVESTMENT IN HOUSE HOLD ACTIVITIES OF RS,1,19,000/ - FOR THE ASSESSMENT YEAR 2000-01, IS INTERCONNECTED WITH THE GROUNDS RAISED BY THE REVENUE IN ITS APPEAL BECAUSE EVEN IF IT IS ACCEPTED THAT THERE WE RE SOME UNRECORDED PURCHASES AND UNRECORDED SALES AS ALLEGED BY THE A .O., THEN ALSO, ENTIRE AMOUNT OF SUCH UNRECORDED PURCHASE AND UNRECORDED S ALES SHOULD NOT BE ADDED AND ADDITION ON THAT ACCOUNT CAN BE MADE ONLY TO THE EXTENT OF PROFITS I.T.A.NO. 157 & 161/AHD/2009 4 IN RESPECT OF SUCH UNACCOUNTED PURCHASES AND UNACCO UNTED SALES. IT IS ALSO SUBMITTED BY HIM THAT IN RESPECT OF ALLEGED SHORTAG E IN STOCK FOUND ON THE DATE OF SURVEY/SEARCH OF RS.32,86,900/-, THE A.O. H IMSELF HAS MADE ADDITION ONLY TO THE EXTENT OF GP ON SUCH ALLEGED UNACCOUNTE D SALES TO THE EXTENT OF ALLEGED SHORTAGE FOUND IN STOCK BY APPLYING THE GP RATE OF 18%. IT WAS HIS SUBMISSION THAT EVEN IN RESPECT OF UNRECORDED PURCH ASE AND UNRECORDED SALES AS ALLEGED BY THE A.O., AT THE BEST, ADDITION CAN B E MADE TO THE EXTENT OF GP OF 18% THEREON. IT IS SUBMITTED THAT TOTAL OF SUCH ALLEGED UNRECORDED PURCHASE AND UNRECORDED SALES IS OF RS.25,88,583/-. IT IS SUBMITTED THAT 18% GP ON THIS AMOUNT COMES TO RS.4,65,940/- ONLY AND L D. CIT(A) HAS ALREADY UPHELD THE ADDITION ON ACCOUNT OF UNRECORDED SALES AND UNRECORDED PURCHASE TO THE EXTENT OF 4,20,074/- AND RS.30,476/- RESPECT IVELY TOTAL OF WHICH COMES TO RS.4,50,550/-. IT WAS SUBMITTED THAT UNDER THIS FACTUAL POSITION, GROUNDS RAISED BY THE REVENUE IN ITS APPEAL SHOULD BE REJEC TED AND THE ORDER OF LD. CIT(A) ON THIS ASPECT SHOULD BE CONFIRMED WITH REGA RD TO PART DELETION OUT OF ALLEGED UNRECORDED SALES AND UNRECORDED PURCHASE. IT WAS ALSO SUBMITTED THAT 18% GP OF RS.4,65,940/- IS FOR TOTAL UNACCOUNT ED PURCHASE AND SALES BUT GP ADDITION IS CALLED FOR IN RELATION TO UNRECORDED SALES ONLY, WHICH IS BELOW RS.4,50,550/- BEING THE ADDITION UPHELD BY LD. CIT( A). 6. WITH REGARD TO THE ASSESSEES APPEAL IN RESPECT OF ADDITION CONFIRMED BY THE LD. CIT(A) OF RS.5,91,642/- ON ACCOUNT OF AL LEGED GP FOR THE ALLEGED DISCREPANCY IN STOCK, IT WAS SUBMITTED THAT NO ADDI TION CAN BE MADE FOR SHORT STOCK FOUND. IT IS ALSO SUBMITTED THAT IN FACT, TH ERE IS NO SHORTAGE OF STOCK AND THE DISCREPANCY IN STOCK AS ALLEGED BY THE A.O. AND IT HAS BEEN FULLY RECONCILED BY THE ASSESSEE AS PER THE DETAILS AVAIL ABLE ON PAGE 32 OF THE PAPER BOOK. I.T.A.NO. 157 & 161/AHD/2009 5 7. REGARDING REMAINING PART OF THE ASSESSEES APPEA L, IN RESPECT OF ADDITION MADE BY THE A.O. OF RS.1.90 LACS IN RESPEC T OF ALLEGED UNEXPLAINED INVESTMENT IN HOUSE HOLD ITEMS, THE SAME CONTENTION S WERE REITERATED BEFORE US AS HAS BEEN RAISED BEFORE LD. CIT(A). IT IS SUB MITTED THAT ALTHOUGH, THE ASSESSEE IS NOT IN A POSITION TO BRING ANY EVIDENCE IN SUPPORT OF THE CONTENTION THAT HOUSE HOLD ITEMS HAVE BEEN IN FACT RECEIVED BY THE ASSESSEE AS GIFT FROM HIS IN-LAWS, THIS CONTENTION OF THE AS SESSEE SHOULD BE ACCEPTED IN VIEW OF THE TRADITION IN THE SOCIETY. ONE MORE CON TENTION WAS RAISED THAT EVEN IF THIS CONTENTION IS NOT ACCEPTED THEN ALSO, SUCH ADDITION SHOULD BE DELETED BY ALLOWING THE ASSESSEE THE BENEFIT OF TEL ESCOPING OUT OF ADDITION UPHELD BY THE LD. CIT(A) OF RS.4,50,550/- IN RESPEC T OF ALLEGED UNRECORDED SALES AND UNRECORDED PURCHASES FOR WHICH THE ASSESS EE HAS NOT PRESSED HIS GROUND IN ITS APPEAL BEFORE THE TRIBUNAL. 8. AS AGAINST THIS, THE LD. D.R. OF THE REVENUE SUP PORTED THE ORDERS OF AUTHORITIES BELOW IN RESPECT OF ASSESSEES APPEAL A ND SUPPORTED THE ASSESSMENT ORDER IN RESPECT OF THE REVENUES APPEAL . 9. 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 THERE ARE THREE MAIN OBJECTIONS OF THE REVENUE. TH E FIRST ALLEGATION IS THAT THERE WERE CERTAIN UNRECORDED SALES AND UNRECORDED PURCHASES TO THE EXTENT OF RS.25,88,583/-. THE A.O. HAS MADE ADDITION OF T HIS TOTAL AMOUNT OF ALLEGED UNRECORDED PURCHASE AND UNRECORDED SALES. LD. CIT(A) HAS ALLOWED MAJOR RELIEF AGAINST THIS ADDITION AND HE UPHELD TH E ADDITION ON THIS ACCOUNT TO THE EXTENT OF RS.4,50,550/-. IN THE FACTS OF TH E PRESENT CASE, WE ARE OF THE CONSIDERED OPINION THAT EVEN IF THIS CONTENTION OF THE REVENUE IS ACCEPTED THAT THERE WERE UNRECORDED PURCHASES AND UNRECORDED SALE S, ADDITION CAN BE MADE ONLY TO THE EXTENT OF PROFITS IN RESPECT OF UNRECOR DED SALES BECAUSE THE I.T.A.NO. 157 & 161/AHD/2009 6 ALLEGATION REGARDING UNACCOUNTED PURCHASE IS MUCH L ESS THAN THE ALLEGATION REGARDING UNRECORDED SALES AND HENCE, THE ADDITION TO THE EXTENT OF GP ON THE TOTAL UNRECORDED SALES CAN BE MADE. THE TOTAL ALLE GED UNRECORDED SALE IS OF RS.18,75,642/- BEING THE AMOUNT OF ADDITION DELETED BY LD. CIT(A) IN RESPECT OF UNRECORDED SALES + RS.4,20,007/- BEING T HE AMOUNT OF ADDITION UPHELD BY LD. CIT(A) IN RESPECT OF UNRECORDED SALES AND THE TOTAL OF BOTH COMES TO RS.22,95,716/-. IF WE APPLY THE GP RATE O F 18% ON THIS TOTAL ALLEGED UNRECORDED SALES OF RS.22,95,716/-, THE GP COMES TO RS.4,13,229/-. LD. CIT(A) HAS ALREADY UPHELD THE ADDITION OF RS.30 ,476/- IN RESPECT OF ALLEGED UNRECORDED PURCHASES AND OF RS.4,20,074/- IN RESPECT OF ALLEGED UNRECORDED SALES AND THE TOTAL OF BOTH THESE AMOUNT S COMES TO RS.4,50,550/-. HENCE, THE ADDITION UPHELD BY LD. CIT(A) OF RS.4,50 ,550/- IS MORE THAN THE GP OF TOTAL UNRECORDED SALES ALLEGED BY THE A.O. ALTHOUGH GROUNDS WERE RAISED BY THE ASSESSEE AGAINST THIS PART ADDITION U PHELD BY THE LD. CIT(A) OF RS.4,50,550/- BUT THE SAME HAS NOT BEEN PRESSED BEF ORE US BY THE LD. A.R. AND HAVE BEEN REJECTED BY US AS NOT PRESSED. HENCE , IN OUR CONSIDERED OPINION, NO FURTHER ADDITION IS JUSTIFIED IN RESPEC T OF ALLEGED UNRECORDED PURCHASES AND UNRECORDED SALES AND, THEREFORE, WE D O NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF LD. CIT(A) ON THIS ISSUE. WE, THEREFORE, UPHOLD THE SAME. 10. IN THE RESULT, APPEAL OF THE REVENUE STANDS DIS MISSED. 11. NOW, WE CONSIDER AND DECIDE THE REMAINING ASPEC TS OF THE ASSESSEES APPEAL AS PER WHICH THE ASSESSEE HAS DISPUTED THE A DDITION UPHELD BY THE LD. CIT(A) OF RS.5,91,642/- ON ACCOUNT OF GP FOR ALLEGE D DISCREPANCY IN STOCK AND OF RS.1.19 LACS ON ACCOUNT OF ALLEGED UNEXPLAIN ED INVESTMENT IN HOUSE HOLD ARTICLES. REGARDING THE FIRST ASPECT I.E. WIT H REGARD TO DISCREPANCY IN I.T.A.NO. 157 & 161/AHD/2009 7 STOCK AND GP THEREON, WE FIND THAT IT IS THE ONLY E XPLANATION OF THE ASSESSEE BEFORE US THAT SUCH DISCREPANCY HAS BEEN RECONCILED AS PER THE PAPER AVAILABLE ON PAGE 32 OF THE PAPER BOOK. ON PAGE 32 OF THE PAPER BOOK, WE FIND THAT THE ASSESSEE HAS CONTENDED THAT EXCESS ST OCK WAS SHOWN IN RESPECT OF SS SCRAP TO THE EXTENT OF 10318.1 KG. AND CORRES PONDING LESS QUANTITY WAS SHOWN IN THE STOCK REGISTER OF MS PIPE SCRAP. BUT NO EVIDENCE WHATSOEVER HAS BEEN FURNISHED BEFORE US IN RESPECT OF THIS CLA IM OF THE ASSESSEE. MOREOVER, THE WORKING OF THE ASSESSEE ON PAGE 32 OF THE PAPER BOOK, DOES NOT SHOW THE TOTAL DISCREPANCY IN STOCK ON THE RELE VANT DATE OF 65738.33 KG. AS HAS BEEN NOTED BY THE A.O. ON PAGE 8 OF THE ASSE SSMENT ORDER. ON PAGE 8 OF THE ASSESSMENT ORDER, IT IS NOTED BY THE A.O. TH AT ON THE DATE OF SURVEY, DISCREPANCY IN STOCK WAS NOTED WHICH IS NOT DISPUTE D BY THE ASSESSEE AND IT IS FURTHER NOTED BY THE A.O. THAT THERE WAS DISCREPANC Y IN STOCK TO THE EXTENT OF 65738.33 KG. IN THE WORKING OF THE ASSESSEE, REGAR DING RECONCILIATION OF SUCH DISCREPANCY IN STOCK AS AVAILABLE ON PAGE 32 O F THE PAPER BOOK, THE ASSESSEE IS EXPLAINING THAT THERE WAS SHORTAGE IN O NE ITEM I.E. SS PIPE SCRAP OF 10318.10 KG. AND THERE WAS EXCESS STOCK FOUND ON THE RELEVANT DATE IN RESPECT OF MS PIPE SCRAP OF 10318 KG. SINCE THE AS SESSEE HAS NOT BROUGHT ON RECORD THE WORKING OF THE TOTAL ALLEGED SHORTAGE IN STOCK FOUND ON THE DATE OF SURVEY OF 65738.33 KG. AS HAS BEEN NOTED BY THE A.O. IN THE ASSESSMENT ORDER, WE CANNOT APPRECIATE THIS RECONCILIATION BEC AUSE, IT MAY BE THAT SUCH SHORTAGE IN STOCK NOTED BY THE A.O. OF 65738.33 KG. IS AFTER REDUCING THE QUANTITY OF EXCESS STOCK FOUND ON THAT RELEVANT DAT E. SINCE IN THE NORMAL WORKING OF THE SHORTAGE, EXCESS STOCK FOUND IS GENE RALLY REDUCED, IN THE ABSENCE OF DETAILS, WE ARE OF THE CONSIDERED OPINIO N THAT THE SHORTAGE OF 65738.33 KG. RECORDED BY THE A.O. IS AFTER CONSIDER ING AND REDUCING THE I.T.A.NO. 157 & 161/AHD/2009 8 EXCESS STOCK FOUND IN RESPECT OF SOME ITEMS AND, TH EREFORE, THIS EXPLANATION HAS NO VALIDITY. 12. SIMILARLY, IN RESPECT OF STOCK OF ANOTHER ITEMS I.E. SS PATTA, IT IS STATED BY THE ASSESSEE ON PAGE 32 OF THE PAPER BOOK THAT T HERE WERE TOTALING MISTAKE ON VARIOUS DATES OF 2142.4 KG., 3434950 KG AND 2519 .5 KG. BUT THE ASSESSEE HAS NOT FURNISHED EVEN THE PHOTOCOPY OF THE RELEVAN T PAGE OF INVENTORY LIST PREPARED BY THE SURVEY TEAM AND OF STOCK REGISTER A FTER HIGHLIGHTING THE ALLEGED TOTALING MISTAKE. IN ADDITION TO THIS, IT IS STATED BY THE ASSESSEE ON PAGE 32 OF THE PAPER BOOK THAT SHORT STOCK FOUND OF 325 KG OF SS ROD HAS TO BE ADJUSTED AGAINST THE STOCK OF SS PATTA BECAUSE T HE ISSUE OF 325 KG. WAS WRONGLY POSTED IN THE STOCK REGISTER OF SS PATTA IN STEAD OF STOCK REGISTER OF SS ROD. THIS ARGUMENT IS NOT VALID BECAUSE THE ASS ESSEE HAS NOT PRODUCED ANY EVIDENCE IN RESPECT OF THIS EXPLANATION BY BRIN GING ON RECORD THE RELEVANT ISSUE SLIP AND THE RELEVANT PAGE OF STOCK REGISTER OF BOTH THESE ITEMS AND MOREOVER, IF THE ISSUE OF ONE ITEM IS TO BE ADJUSTE D AGAINST THE STOCK OF OTHER ITEM, TOTAL SHORTAGE/EXCESS WILL REMAIN THE SAME. UNDER THIS FACTUAL POSITION, WE FEEL THAT THE ASSESSEE HAS NOT BEEN ABLE TO EXPL AIN THE DISCREPANCY FOUND IN STOCK OF THE ASSESSEE ON THE RELEVANT DATE. THE A.O. HAS ALSO MADE ADDITION OF ONLY GP IN RESPECT OF SUCH SHORT STOCK FOUND, WHICH IS VERY REASONABLE IN OUR CONSIDERED OPINION BECAUSE IF THE ASSESSEE IS CLAIMING THAT THERE IS STOCK OF 65738.33 KG. AND SUCH STOCK IS NO T PHYSICALLY AVAILABLE WITH THE ASSESSEE ON THE DATE OF SURVEY/SEARCH, IT IS RE ASONABLE PRESUMPTION THAT ASSESSEE HAS SOLD SUCH ITEMS. WHEN AN ITEM IS LYIN G INTO STOCK, THE COST OF THIS HAS TO BE CONSIDERED AS CLOSING STOCK WHILE PR EPARING THE P & L ACCOUNT AND IF THE SAME STOCK IS ALREADY SOLD OUT THEN THE SALE PROCEEDS OF SUCH ITEM HAS TO BE CONSIDERED WHICH WILL INCLUDE THE COST OF GOODS + GP THEREOF. HENCE, FOR UNRECORDED SALES TO THE EXTENT OF SHORTA GE FOUND IN STOCK, ADDITION I.T.A.NO. 157 & 161/AHD/2009 9 ON ACCOUNT OF GP IS JUSTIFIED AND THIS SUBMISSION O F THE ASSESSEE THAT NO ADDITION CAN BE MADE IN RESPECT OF SHORTAGE FOUND I N STOCK IS UNFOUNDED. WE, THEREFORE, DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF LD. CIT(A) WITH REGARD TO THIS ADDITION OF RS.5,91,642/- IN RE SPECT OF UNACCOUNTED GROSS PROFIT FOR DISCREPANCY IN STOCK. 13. WITH REGARD TO REMAINING ASPECT I.E. REGARDING ADDITION MADE BY THE A.O. IN RESPECT OF ALLEGED UNEXPLAINED INVESTMENT I N VALUABLE HOUSE HOLD ITEMS OF RS.1.19 LACS, WE FEEL THAT THERE IS FORCE IN THE SUBMISSION OF LD. A.R. OF THE ASSESSEE THAT EVEN IF THE CLAIM OF THE ASSESSEE REGARDING GIFT IS NOT ACCEPTED, THE ASSESSEE DESERVES THE BENEFIT OF TELESCOPY ON ACCOUNT OF PART ADDITION UPHELD BY THE LD. CIT(A) AND ALSO BY US IN RESPECT OF ALLEGED UNRECORDED SALES AND UNRECORDED PURCHASES TO THE EX TENT OF RS.4,50,550/-. WE, THEREFORE HOLD THAT AFTER ALLOWING THE BENEFIT OF TELESCOPY, THIS ADDITION MADE BY THE A.O. OF RS.1.19 LACS IN RESPECT OF ALLE GED UNEXPLAINED INVESTMENT IN VALUABLE HOUSE HOLD ITEMS, SHOULD BE DELETED. WE, THEREFORE, DELETE THE SAME. 14. IN THE RESULT, APPEAL OF THE ASSESSEE STANDS PA RTLY ALLOWED WHEREAS APPEAL OF THE REVENUE IS DISMISSED. 15. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH JULY, 2011. SD./- SD./- (MUKUL KUMAR SHRAWAT) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED : 29 TH JULY, 2011 SP I.T.A.NO. 157 & 161/AHD/2009 10 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 1. DATE OF DICTATION 19/7 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 25/7 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 27/7 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 29/7 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S. 29/7 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 29/7/11 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. ..