Stock variation and undisclosed purchases may sustain additions, but estimated suppression without evidence cannot be upheld.

Additions based on stock variation, excess stock found on inspection, and undisclosed purchases were sustained because they rested on factual findings and materials on record showing incorrect accounts and purchases from undisclosed sources. An equal addition made towards probable suppression was deleted because it was based only on estimate and conjecture without supporting evidence. The operative principle is that a concrete evidentiary basis can justify an addition, but a parallel addition founded only on guesswork cannot be upheld.

---

---

Issues: (i) Whether the addition made on account of stock variation and undisclosed purchases was justified. (ii) Whether the equal addition made towards probable suppression could be sustained.

Issue (i): Whether the addition made on account of stock variation and undisclosed purchases was justified.

Analysis: The authorities recorded factual findings that the assessee had not maintained correct accounts, that excess stock was found during inspection, and that purchases from undisclosed sources were established by the materials on record. The addition rested on these materials and was not shown to be unsupported by evidence.

Conclusion: The addition made on account of stock variation and undisclosed purchases was sustained.

Issue (ii): Whether the equal addition made towards probable suppression could be sustained.

Analysis: The equal addition was made only on a probable and estimated basis without supporting material. Such an addition was treated as mere guesswork and not founded on valid evidence.

Conclusion: The equal addition towards probable suppression was deleted and was not sustained.

Final Conclusion: The revision succeeded only to the limited extent of deleting the equal addition for probable suppression, while the substantive additions based on inspection and stock variation were maintained.

Ratio Decidendi: An addition based on concrete inspection material and factual findings can be sustained, but an equal addition resting only on conjecture or estimate without supporting material cannot be upheld.

---