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TMI Blog2022 (11) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... sment proceedings, when it was duly explained by the assessee. We have made reference to Closing Stock for A.Y. 2012-13 simply for the reason that these details are not being put up before us as a consequence to the survey, rather these details were put up before the Revenue prior to the survey. Therefore, in our opinion, addition is not sustainable. We allow this ground of appeal and delete the addition made to the income of the assessee on account of unexplained excess stock. Appeal of the assessee is allowed. - I.T.A. No. 1818/KOL/2019 - - - Dated:- 30-9-2022 - Shri Rajpal Yadav, Vice-President (KZ) And Shri Rajesh Kumar, Accountant Member Shri Siddharth Agarwal, Advocate, A.R., appeared on behalf of the assessee Shri P.P. Barman, Addl. CIT, appeared on behalf of the Revenue ORDER Per Rajpal Yadav, Vice-President (KZ):- The assessee is in appeal before the Tribunal against the order of ld. Commissioner of Income Tax (Appeals)-13, Kolkata dated 28.06.2019 passed for Assessment Year 2013-14. 2. The assessee has taken 3 grounds of appeal, out of which peripheral arguments are being taken in Grounds No. 2 3, which do not call for recording any s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 52815246 8978592 43836655 Vide assessee s submission 52815246 1875185 50940061 8659810 42280251 Further on 04.03.2016, the assessee filed rectified casting mistakes of Rs. 21,14,900/- and accordingly the value of physical closing stock arrived at Rs.4,25,28,2 55/ - as computed be low: - Physical value of stock as per MRP/ selling price Less: Casting mistake made in totalling of sheets Actual physical value of stock as per MRP/selling price Less: Profit element on such stock @17 % Value of stock inventory arrived the at cost price 52815246 2114900 50700346 8619058 42081288 (b) Further, as per the assessees submission, inventory of stock at Tally ERP-9 of Rs.3,40,49,791/- was as on 04.12.2012 but the physical stock was taken on 11.12.2012. The assessee filed are concilation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tware is remained unexplained. (c)During the course of survey, stock as per Tally ERP was Rs.3,40,49,791/-, which was up to the date of 04-12-2012, The assessee has updated the stock of Tally ERP upto the date of survey i.e. 11-12-2012 and stock as on survey date reconciled to Rs.3,76,75,180/- but the physical stock found during the course of survey was Rs.4,22,80,251/-, which was discussed in para 2(b) above. Therefore, a stock discrepancy of Rs.44,06,108/- was still exists after updating the Tally ERP which was not satisfactorily explained. (d) As per the assessee s above submission, the inventory valuation of stock of the concern is being maintained in the accounting software ORIEL POS wherein the purchases and sales are tracked and cost specific and identifiable inventory items that are either in or out of stock are maintained on an individual basis via BAR CODE codification in SPECIFIC IDENTIFICATION li METHOD and direct sales report are generated on the actual valuations for specific cost of stock-IN or stock OUT, which are thereupon entered in the Tally ERP-9 accounting software. Here, the question arises that if the actual valuations were entered in the Tally ER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 82,738.00 Gross Profit 1,94,31,207.87 48,06,554/- 2,42,37,761.25 Income Tax paid 21,08,594/- Assessment Tear: 2012-2013 TALLY ERP-9 Difference in valuation As per Audited Trading Account (ORIEL POS) Closing stock 2,33,48,269.31 1,06,39,423/- 3,39,87,692.00 Gross Profit 1,95,46,535.81 1,06,39,423/- 3,01,85,958.50 Income Tax paid 27,61,487/- 7. Ld. Counsel for the assessee took us through page no. 36 of the paper book, where Trading and Profit Loss Account for the year ended on 31st March, 2012 is available. He submitted that in these audited accounts, the stock as on 31.03.2012 has been worked out at Rs.3,39,87,692/- and this very figure is available in the table extracted sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rough all these details available in the paper book on pages no. 30 to 50. Thus we are satisfied that excess stock has been worked out by the ld. Assessing Officer on the basis of an erroneous mathematical exercise. This stock has been worked out not on account of particular items, rather on account of valuation difference, which has been worked out by appreciating two different Softwares for the purpose of book stock, vis-a-vis actual stock and if some exercise is being carried out in this manner, then difference is bound to happen. The ld. Assessing Officer failed to appreciate this aspect during the assessment proceedings, when it was duly explained by the assessee. We have made reference to Closing Stock for A.Y. 2012-13 simply for the reason that these details are not being put up before us as a consequence to the survey, rather these details were put up before the Revenue prior to the survey. Therefore, in our opinion, addition is not sustainable. We allow this ground of appeal and delete the addition of Rs.44,06,108/- made to the income of the assessee on account of unexplained excess stock. 10. In the result, the appeal of the assessee is allowed. Order pronounced in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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