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TMI Blog2012 (5) TMI 458X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee and to make reasonable addition considering the history of the assessee The stock during the course of the proceedings was found to be negative, therefore, it could be presumed that the same was sold outside the books of accounts - The assessee deals in several varieties of the items and as such it would be difficult to maintain details of the stock. The assessee produced all the books of accounts and sales and purchases vouchers before the AO for verification - Decided in favor of the assessee by way of addition of Rs.47,72.525/- is restricted to Rs.3,00,000 - ITA No. 2043/Ahd/2009 - - - Dated:- 20-10-2011 - Bhavnesh Saini, A.L. Gehlot, JJ. S.N. Soparkar, AR, for the Appellant B.L. Yadav, Sr. DR, for the Respondent ORDER Bhavnesh Saini: This appeal by the assessee is directed against the order of the learned CIT(A), Valsad dated 26th April,2009, for assessment year 2006-07. 2. The learned Counsel for the assessee did not press grounds No.3, 4 and 5 of the appeal. The same are dismissed as being not pressed. Ground No.6 is regarding charging of interest which is consequential. Ground No.7 is regarding initiating penalty proceedings u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hown in the P and L Account. Please note that the stock book is only the subsidiary record. We have taken and accounted closing stock in manufacturing account as per Actual physical stock. In certain items purchases billing has been 'in cartoons (unit) and the sales billing was 'in pieces (unit)' or 'on packers' unit. Therefore in the stock of items 'in packets' or 'in piece' there are only sales and no purchases and therefore there is negative stock in that items. There are certain cases of sales bills having been recorded first and purchase bill recorded later. The reasons for late recording of purchases bills can be a) some dispute regarding the quantity, quality, rate of the materials purchased and therefore recording of the purchases bill put on hold. b) late receiving of the bill c) if sales tax return for the month (of the date of the bill) is filed and bill is received after that, then we record the purchase bill on the current date rather than the bill date. In some items there are some very very minor discrepancies. We have adjusted the sales quantity figures in the details filed with the Audit report (with return) to match the figures of closing s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee or has done all things mechanically adding up the very small amounts in several number of times and writing the same in the assessment order itself. The assessee had also made several baseless allegations against the AO in its statement of facts. 4. The learned CIT(A) considering the explanation of the assessee dismissed this ground of appeal of the assessee. His findings in the appellate order in Para 6 reads as under: "6. I have carefully considered the facts of the case and the submission of the A.R, of the appellant and the detailed statement of facts as submitted before me by the appellant along with the grounds of appeal. Admittedly the appellant was not able to furnish reconciliation statement as regards the major manufacturing items either before the assessing officer or before me during the course of this appeal proceedings. In the absence of any reconciliation statement and proper explanation from the part of the appellant to explain the discrepancies properly I am constrained to agree with the assessing officer as regards the addition made on account of difference in stock. The addition made by the assessing officer is upheld and this ground of appeal is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the seller of the goods. Only the realisation of the excess over the cost incurred could form part of the profit included in the consideration for the sales. No material is brought on record to the effect that the investments by way of incurring cost in acquiring the goods, which were sold had been made by the assessee and that the investment was also not disclosed. The ld. CIT(A) noted that difference in stock was worked out on oral statement of assessee which was not corroborated by actual figure. Earlier statement was also retracted. It is also a matter of record that stocks of both the concerns were mixed up at survey. So no actual counting could take place. The learned CIT(A) on further examination of the case of the assessee found that there is difference in stock of Rs.20,315/- which is not reconciled at any stage. Therefore, rejection of book results is justified. The learned CIT(A) on proper appreciation of the materials on record, rightly rejected the book results of the assessee and estimated the income of the assessee by applying GP rate. Even if higher GP rate is applied against unaccounted sales, as made by the AO, the addition would be more or less the same as is co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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