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TMI Blog2012 (12) TMI 1051X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 8,02,700/- on account of excess cash found and accepted by the assessee in his statement during the course of survey u/s. 133A. ii) On the facts and circumstances of the case, Ld. Commissioner of Income Tax (A) was not justified in deleting the addition of ₹ 18,20,000/- on account of renovation of shop from unaccounted sources being accepted by the assessee during the course of survey u/s. 133A. iii) On the facts and circumstances of the case, Ld. Commissioner of Income Tax (A) was not justified in deleting the addition of ₹ 8,17,962/- on account of excess stock found at the premises of the assessee during the course of survey u/s. 133A. iv) The appellant craves leave to add, alter or amend any / all the grounds of appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the rival contentions in light of the material produced and precedent relied upon. We find that following was a detail of cash found during the survey, copy of statement was duly submitted by the ld. Counsel of the assessee. The same inventory read as under:- (Rs.) i) 1000x100 = 1,00,000 ii) 500x1362 = 6,81,000 iii) 100 x 519 = 51,900 iv) 500 x 50 = 7,500 v) 20 x 15 = 300 vi) 10 x 132 = 1,320 vii) Coins = 141 = ₹ 8,42,161/- From the above, we note that Ld. Commissioner of Income Tax (A) has clearly erred in holding that there no inventory of cash found. The inventory of cash was duly found at the time of survey and excess cash was noted. The cash inventory prepared was duly signed by the assessee. Under the circumsta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat huge expenditure of 18,20,000/- has been incurred in renovation of the shop. Ld. Commissioner of Income Tax (A) observed that earlier in the surrender statement on this account the assessee has stated "no major renovation has been done in this premises, it is in the nature of normal repairs…. however, to buy peace I am surrendering ₹ 18,20,000/- on account of renovation of this shop." 8.1 From the above, Ld. Commissioner of Income Tax (A) observed that it is evident that addition of ₹ 18,20,000/- was not based on any material or evidence. The premises are stated to be on rent. At the time of survey no unaccounted bills or vouchers relating to this expenditure have been found or identified. Accordingly, Ld. Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k at cost price and market price whichever is lower. It was further submitted that the average discount provided in this regard on the purchase was 18 to 24% approx. on the rate mentioned in the bill. Accordingly, it was submitted that the valuation as taken by the survey team on the MRP of items was misleading and unjustified. Considering the above, Ld. Commissioner of Income Tax (A) observed that on being confronted with the excess stock found in reply to query no. 19 the assessee has clarified that "Physical inventory has been valued at MRP. If it is taken at cost price there should not be any difference." However, as per the assessee's own admission stock register was not maintained. Hence, it was not possible to show the cost price of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed profits' on the sale outside the books. The appellant accordingly gets a relief of ₹ 817962/-." 13. Against the above order the Revenue is in appeal before us. 14. We have heard the rival contentions in light of the material produced and precedent relied upon. We find that it is the contention of the assessee on this issue that the stock at the time of survey was valued at MRP. If the necessary valuation is done by applying the average purchase cost the same would not result any discrepancy in stock. In our considered opinion, Ld. Commissioner of Income Tax (A) has correctly observed that it would be reasonable to allow 20% discount on the MRP value. In our considered opinion, Ld. Commissioner of Income Tax (A) has taken a correc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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