9911796707
TMI Blog2017 (12) TMI 413X X X X Extracts X X X X X X X X Extracts X X X X ..... .2012 for the Assessment Year 2005-06. By that common order, the Tribunal has decided the revenue's appeal being ITA No. 5/Agr/2011 and the assessee's appeal being ITA No. 460/Agr/2010. The Tribunal has dismissed revenue's appeal and allowed the assessee's appeal. The present appeal has been filed on the following questions of law: "(1) Whether on the facts and circumstances of the case, the Hon'ble ITAT was justified in law to hold that the AO had no occupation to invoke Section 145(3)? (2) Whether on the facts and circumstances of the case, the Hon'ble ITAT was justified in interpreting the provisions of Section 68 in the way it did in this present case? (3) Whether the ITAT was justified in deleting the addi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come Rs. 2,84,940/-. The said return was taken up under scrutiny. Vide assessment order dated 14.12.2007, the assessee was assessed to tax on total income at Rs. 1,02,90,750/-. In that assessment, an addition of Rs. 62,95,813/- was made by way of unexplained investment in closing stock under Section 69 of the Act and another addition of Rs. 37,10,000/- was made on account of unexplained cash credit under Section 68 of the Act. In the appeal to the CIT (Appeals), two remand reports were submitted by the assessing officer especially with respect to the alleged unexplained cash credit under Section 68 of the Act. The Commissioner of Income Tax (Appeal) vide his order dated 25.10.2010 partly allowed the appeal. He restricted the addition made u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unting and had valued its stock in the same manner for the Assessment Years 2004-05, 2006-07 and 2007-08 for which years also the assessee had been subjected to assessment under Section 143(3) of the Act and in those assessment proceedings the value of closing stock disclosed by the assessee had been accepted. The Tribunal, therefore, did not find any reliable or cogent reason to reject the book results of the assessee and to make the addition to the value of closing stock of residential flats. Upon such discussion and reasoning made by the Tribunal in detail and having thus considered the facts and evidence on record, the Tribunal deleted the addition to the closing stock of Rs. 62,95,813/-. With respect to the additions made under Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sclosed by the assessee for the relevant period. As to the deletion of addition made under Section 68 of the Act, learned counsel for the revenue submits that Rs. 8,00,000/- deposited on 09.02.2004 by Aashiq Ali Siddiqui could not have been deleted as that person did not appear in response to the notice sent by the assessing officer. No other challenge has been made to the order of the Tribunal. Learned counsel for the assessee has relied on the findings recorded by the Tribunal and submitted that the same are concluded findings of fact based on evidence and as such they do not warrant any interference. Having considered the argument so advanced by learned counsel for the parties, we find that ordinarily closing stock may be valued eithe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e clubbed together to apply the gross profit rate thereto to infer the deemed cost of closing stock. Here, we find that besides the foundation being non-existent (as the Tribunal has found), even the method adopted by the assessing officer is doubtful if not plainly erroneous. In any case, valuation of closing stock being an issue of fact that has a cascading effect in different years, we find that the Tribunal has accepted the valuation of closing stock upon due appraisal of evidence inasmuch as it has found that the cost claimed by the assessee was duly verified from vouchers and the assessee's same method of accounting had found acceptance during assessment proceedings for the Assessment Years 2005-06, 2006-07 and 2007-08 in proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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