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TMI Blog2010 (10) TMI 848X X X X Extracts X X X X X X X X Extracts X X X X ..... en by the assessee subsequently cannot be accepted as the truth. It is a just and proper conclusion and thus the shortage of rectified spirit as on the date of search was correctly determined. The order of the Tribunal indicated that it was based only on the explanation given by the assessee nearly six months later. In the absence of any material indicating that at the relevant point of time excise officials had an occasion to certify the stocks in the course of their regular vigil over the premises of the assessee, the conclusion of the appellate Tribunal is only based on imagination and surmises - substantial questions of law answered in favour of the revenue holding that the Tribunal was not justified in placing reliance on extraneo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1)(a) of the Income Tax Act, 1961, (hereinafter referred to as 'the Act'). 3. On 6.8.1992 a search was conducted in the business premises of the assessee and missing rectified spirit of 33,980 liters was detected. It was valued at Rs.16,00,000/- (rupees sixteen lakhs) was missing. The explanation offered by the Executive Director was found to be without substance as the claim of rectified spirit being converted to IMFL and sold could not be verified without any proof to substantiate the same. 4. The assessing officer, concluded during the course of regular assessment, that the rectified spirit referred to above has been sold by the assesse outside the books of accounts. Hence entire Rs.16,00,000/- was treated as the income of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to other items and the same sold in different forms. The defence of the assessee is that excise officials could not find any shortage of any rectified spirit, therefore, presumption is that there was no such shortage in fact, as otherwise the excise officials would have definitely taken action against the assessee. 6. The assessing authority observed that the explanations offered by the assessee much later i.e. by letters dated 23.12.1994 and 27.1.1995 were to be read in conjunction with the statements of the staff of the assessee recorded on 6.8.1992 and also the explanation given by the Executive Director dated 10.8.1992. The assessing officer was justified in saying that by 10.8.1992, the Executive Director had time to ponder over th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee particularly, when two officials were present, namely Mr. A.J.K. Shenoy and Mr. S.K. Bhowmik, who knew about the entire business. The fact that the employees of the assessee did not raise any objection would only lead to presumption that there was no error in the method of determination of stock determined by the officials. Much later on 10.8.1992, though the Executive Director Mr. Ravindranath gave an explanation, the said explanation is not at all convincing as he had time to give a defensive explanation. Even to give the quantity of rectified spirit, he must have gone through the relevant details and the process with the assistance of his employees. Hence, it cannot be said that he was inexperienced and therefore, was not able to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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