9911796707
TMI Blog2021 (2) TMI 1129X X X X Extracts X X X X X X X X Extracts X X X X ..... ness of purchase and sale of gold and silver ornaments. A survey action u/s.133A of the Income-tax Act, 1961 was conducted at the business premises of the assessee on 10/11-02-2010. During the course of survey, excess stock of gold and silver ornaments was found. In the statement recorded during the course of survey, the assessee agreed for the additional income on account of excess stock of Gold and Silver amounting to Rs. 14,57,764/-. A return of income was filed in which excess stock of Rs. 5,76,072/- only was declared in the Trading account for the pre-survey period. The assessee was called upon to explain as to why the remaining excess stock offered at the time of survey was not declared. The assessee tendered an explanation to the eff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the basis of such books of account, a trading account was prepared by the assessee deducing a figure of closing stock on the date of survey, which was given for consideration to the survey party. Simultaneously, physical stock was also taken. Difference was found in the quantity of Silver as well as Gold which was valued at market price thereby computing the excess stock of Rs. 14.57 lakh. Later on, the assessee filed a letter with the AO sometime in May, 2010 claiming that certain purchase bills were omitted to be recorded in the books of account at the time of survey, against which the stock was inventorized. It was thus claimed that if such bills were considered, the difference remains only to the tune of Rs. 5.76 lakh which was offered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 40/- and silver ornaments net weight 29018 grams, today's market rate Rs. 26.000/- per kg and accordingly total value Rs. 7,54,469 . . . ". From the above question, it is apparent that the survey party has computed total stock of Gold at Rs. 19,54,340/- and Silver at Rs. 7,54,469/- on the basis of market rate as on the date of survey. It was on this basis that the excess stock of Rs. 14.57 lakh was computed. I have seen from the Auditor's report in Form no. 3CD that the assessee was valuing its stock at Cost price. This deciphers that the opening stock was also valued at Cost price. In that view of the matter, the difference in stock at the time of survey ought to have been calculated w.r.t. the Cost price and not its Market rate. I have ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
