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TMI Blog2012 (2) TMI 303X X X X Extracts X X X X X X X X Extracts X X X X ..... d also most of the items in the closing stock are out of the opening stock and, whatever, items had been purchased, they have been sold and thus, the AO was not justified to adopting the rates which have been mentioned in the stock register in an adhoc manner. Thus, the assessee is entitled to relief of a sum of Rs.7,53,949/- .” AO disallowed interest as advances were given without any business expediency - Held That:- In view of S.A.Builders(Supreme Court), held that the advances were made for commercial use, hence impugned disallowance was deleted. - ITA No.1354/CHD/2010 - - - Dated:- 4-1-2012 - SHRI H.L.KARWA, SHRI MEHAR SINGH, JJ. Department by: Shri N.K.Saini Assessee by : Shri Sudhir Sehgal ORDER PER MEHA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deleted the addition of Rs.7,53,949/- out of the total addition of Rs.8,46,815/- after discussing al l relevant points and giving his detailed reasons for deleting the abovesaid addition. 3. That the ld. CIT(A) has also rightly deleted the addition of Rs.43,000/- made by the AO by making disallowance u/s 36(i) ( iii) of the Income- tax Act. 4. That the ld. CIT(A)- II has erred in upholding the addition of Rs.7,60,000/- out of total addition of Rs.16,06,815/- made by the AO in respect of so-called under valuation of closing stock. 5. That the ld. CIT(A) has also erred in giving his findings against the assessee for taking a case in scrutiny. 6. That the appellant craves leave to add or amend the grounds of appeal before the appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowed is Rs.57050/- as stated above. It is clarified here that the AO has adopted the rate of this item at Rs.19,50 as per notings made in the Stock Register. However, the opening stock as on 1.4.2006 of the same item of 41900 pieces of HUB PH/Type 40H had been adopted at Rs.19/- per piece and the assessee had been following consistent method of accounting i.e. the cost or market value, whichever is less and, therefore, the value to be adopted is taken at Rs.19/- only and notings in the stock register of the rates are not conclusive evidence of the cost of the item. 6. The findings of the ld. CIT(A) are based on the material brought before him by the assessee and on appreciation of the submissions filed before him. The ld. CIT(A) confir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rates which have been mentioned in the stock register in an adhoc manner. Thus, the assessee is entitled to relief of a sum of Rs.7,53,949/- . 8. A bare perusal of the findings of the CIT(A) reveals that the assessee had been consistently following method of accounting for valuing at cost or market value, whichever is less. He also recorded the finding that AO was not justified to adopt the rates which have been mentioned in stock register in an adhoc manner. Consequently, the addition of Rs.7,53,949/- was deleted by the AO. 9. We do not find any infirmity in the findings of the CIT(A), hence Ground raised by the Revenue is dismissed. 10. The Ground No.3 raised by the Revenue is interconnected with Ground No.2. Hence, the same stan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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