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TMI Blog2021 (9) TMI 1560X X X X Extracts X X X X X X X X Extracts X X X X ..... not treated as unexplained investment u/s 69 of the Act and tax rate under section prescribed under section 115BBE need not apply. A reply thereof was furnished (dated 19.12.2019) to the A.O. On consideration of the facts and circumstances narrated in the reply and original submissions, the AO found merit in the plea of the assessee and dropped the issue and did not disturb the position taken by the assessee. Certain case laws are relied upon to support the stance taken by the assessee. As contended that statement taken u/s 133A should either be relied in full or not relied upon - A part of statement cannot be read differently. On appraisal of the facts narrated on behalf of the assessee, it is manifest that the assessee has taken a consis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied on this point. Mismatch between figures appearing in the Trial Balance viz-a-viz audited Balance Sheet towards purchases - AO has examined the books. The PCIT himself could have called for records again and looked into the explanation offered by the assessee himself. On a perusal of the purchase figures under various heads, we find justification in the explanation of the assessee towards regrouping of certain purchase entries. For instance, under the head Inside State Ornaments (URD) purchases appearing in the Trial Balance seem to have been clubbed under the head New Ornament Old Ornament making it comparable. Once the transfer entries are passed, the figures as per Trial Balance and audited account stands at the near vicinity and pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O.) was directed to pass the assessment order denovo after making enquiries on the points set out in the notice which has already examined and considered during the original assessment proceedings concerning A.Y. 2017-18. The assessee has challenged the assumption of jurisdiction by the PCIT under section 263 of the Act essentially on the ground that the Assessment Order under revision is neither erroneous nor prejudicial to the interest of the revenue. 3. Briefly stated, the assessee is engaged in the business of trading of Gold Ornaments, Gold Bullion, Diamond Ornaments precious metals and derives income therefrom. A survey under section 133A of the Act was conducted on the business premises of the assessee on 06.03.2017. During the cours ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred under section 263 of the Act, the PCIT has proposed revision of the assessment order on two counts: i) The excess stock surrendered by the assessee during the survey, returned as business income, is liable to be considered as unexplained investment under section 69 of the Act and consequently tax was required to be enforced in terms of section 115BBE of the Act. ii) The figures of purchase in the in the audited accounts drawn as on 31.03.2017 were not reconciled with the figures in the Trial Balance as on the date of survey i.e. 06.03.2017. 8. As regards the first issue concerning assessment of excess stock under section 69 of the Act, it is contended on behalf of the assessee that in the course of statement recorded during the surve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the assessee. 9. It was contended that statement taken under section 133A of the Act should either be relied in full or not relied upon. A part of statement cannot be read differently. On appraisal of the facts narrated on behalf of the assessee, it is manifest that the assessee has taken a consistent position on submission of excess stock from business activities and thus a business income in ordinary course right from survey proceedings till filing return of income and subsequent completion of assessment. Significantly, the A.O. has made specific query in this regard and found the reply of the assessee in sync with the factual matrix. Thus the action of the A.O. was after due application of mind. We further notice that similar issues ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dited Balance Sheet has been drawn at 31.03.2017. The assessee contends that it cannot be visualised that two figures at different dates would ordinarily match particularly where the business of the assessee is dynamic and continuing. Secondly, the Trial Balance itself has been taken from books of accounts maintained by the assessee which has been updated as on 31.03.2017 after the survey and, therefore, there is no variance as on date of survey. Thirdly, the audited accounts are drawn having regard to the provisions of Company Law and the figures appearing in the group and the subgroup of a particular genre are regrouped and rearranged to make it in conformity with the accounting requirements to make it readable to the user of the Balance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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