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TMI Blog2016 (9) TMI 1544X X X X Extracts X X X X X X X X Extracts X X X X ..... to give some discount, therefore, the valuation by survey team at highest prices was not justified. AO has not made out a case that assessee had not been valuing its stock at sale prices as normally the stocks are valued at cost prices or market prices whichever is less. Therefore, valuation of inventory at the time of survey at sale prices is not at all justified. The assessee had submitted that the gross profit ratio earned by it for the last five years and has also filed the gross profit earned by assessee in the same trade by its competitors and had requested the AO to consider the gross profits of these firms also but AO did not consider the submissions and neither rebutted any of the submissions made by assessee - addition made by AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of 18.46% which was declared in the preceding year. The learned AR submitted that the value of stock as per trading account came out to be ₹ 67,96,273/- and therefore, Assessing Officer made the addition of ₹ 2,59,420/- holding that the such stock were excess stocks held by assessee. The learned AR submitted that the Hon'ble Punjab & Haryana High Court in the case of CIT vs. Bhalla Bros. reported 10 TLR 45 has held that assumption of uniform gross profit rate in the case of all sales in each and every month was arbitrary and the discrepancies in the stock worked on such assumption is not acceptable. It was submitted that this decision has been followed by the Chandigarh Bench of ITAT in the case of Saqi Brothers Vs. ITO repor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt, therefore, the valuation by survey team at highest prices was not justified. Moreover, the Assessing Officer has not made out a case that assessee had not been valuing its stock at sale prices as normally the stocks are valued at cost prices or market prices whichever is less. Therefore, valuation of inventory at the time of survey at sale prices is not at all justified. The assessee vide its letter dated 22.11.2011 placed at (PB 6 to 10) had submitted that the gross profit ratio earned by it for the last five years as is apparent from (PB-9) and has also filed the gross profit earned by assessee in the same trade by its competitors and had requested the Assessing Officer to consider the gross profits of these firms also but Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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