2009 (10) TMI 15

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..... formation was obtained from the Bank under Section 133 (6) of the Income-tax Act. Further, no cogent reason has been assigned by the Assessing Authority as to why he has taken average of the stock instead of relying on the closing stock as disclosed in the accounts books on 31.3.2002 – matter remanded for fresh consideration - 61 of 2007 - - - Dated:- 7-10-2009 - Hon'ble V.K. Shukla, J. and Hon'ble Rajiv Sharma, J. Petitioner's Counsels - Rohit Nandan Shukla Respondent's Counsel - D.D. Chopra JUDGMENT Heard Mr. Rohit Nandan Shukla, learned Counsel for the appellant and Mr. D. D. Chopra, learned Counsel for the respondents. Learned Counsel for the appellant submits that the appellant-assessee has filed the retu .....

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..... (2) Whether the ld. Income Tax Appellate Tribunal was justiifed in confirming the addition of Rs.4,99,936/- which had been added in the computation of total income as 'undisclosed closing stock' representing the value of the excess stock hypothecated to the bank despite the fact that the cash credit hypothecation statement of stock filed in the usual course because the appellant was availing higher credit limit from the bank and the physical presence of the stock was neither certified nor established by the bank on the basis of which the whole addition was upheld? (3) Whether the ld. Income Tax Appellate Tribunal is justified in confirming the order of CIT (Appeal) despite the settled law that the tax authorities having relied on one par .....

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..... Clerk of the firm and the same was furnished to the bank and the assessee was unaware of this fact. Further, the assessee had no mala fide intention and was under bona fide belief that there is nothing wrong in the statement furnished to the bank as the entire purchases and sales are fully vouched and the authorities had also failed to point out any irregularity in the books of accounts maintained by the assessee during the course of his business but in the alternate accepted the same in toto. He further submits that such explanation in respect of bona fide mistake in valuation of stock hypothecated to the banks for the purpose of overdraft but it is acceptable generally in the routine course of business. It is not being disputed betwee .....

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