9911796707
TMI Blog2011 (4) TMI 606X X X X Extracts X X X X X X X X Extracts X X X X ..... . 3,10,177 on account of difference in stock. On being asked, the assessee contended that at the time of survey, the assessee was conducting sale on discount ranging from 30 per cent to 50 per cent. Therefore, taking of sale price of the items at tag price was not correct. The Assessing Officer (AO) required the assessee to furnish various details regarding stock. However, the assessee did not furnish any detail along with evidence despite various opportunities. Accordingly, the Assessing Officer made addition of Rs. 25,89,823 (Rs. 29,00,000 - surrendered during survey - Rs. 3,10,177 declared in the return) to the income of assessee on account of difference in stock. 2. The CIT(A) confirmed the addition observing that there was a discrepan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee at Rs. 68,92,500 in its return. The Tribunal further observed that the assessee had disclosed a sum of Rs. 3,10,177 on account of difference in value of stock, which should be at Rs. 6,77,600 (Rs. 72,60,000 - Rs. 65,82,400). Thus, the Tribunal reduced the addition to Rs. 6,77,600 as against Rs. 25,89,823 made by the Assessing Officer. 4. After going through the orders passed by the Tribunal, we find that the Tribunal has apprised material and facts appearing on record. It has rightly observed that in the instant case, the controversy revolves round the following points: (i) Whether the tag price or the discounted sale price at which goods were sold by the assessee to the customers is to be taken as the base ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is and his employee, it is beyond any doubt that the goods were also being sold at the discount of 50 per cent since last about one and half month. However, the factor by itself is not conclusive to prove and establish that the cost price of all the goods were half of the tag price attached to the salable goods. Only some of the items were sold at a discount of 50 per cent of the tag price. The assessee has furnished the working of value of stock before us, and on perusal thereof, we find that the assessee has claimed the sum of Rs. 14,99,304 as discount amount to tag price for the purpose of working out the cost price or market price of stock whichever is lower. While working out the discount amount of Rs. 14,99,304 by the assessee, we see ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uestion arise as to the what extent the profit in embedded in the overall stock of Rs. 92,00,000. The survey party has given credit only of 10 per cent as against which assessee has claimed that the average profit earned by the assessee on all the goods whether sold at tag price or at discounted price would be about 20 per cent. In this connection, we have perused the assessment order made under section 143(3) of the Act for the assessment years 1994-95, 1995-96 and 1996-97 shown by the assessee is at the rate of 20.42 per cent, 20.40 per cent and 20.34 per cent and having found the same to be low, the Assessing Officer made a lump sum addition of Rs. 20,000 to cover up the possible leakage in the profit. It makes it clear that the gross pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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