Tribunal allows part of assessee's appeal, directs assessing officer on peak amount inclusion. Inflation in stock figure dismissed. The appeal by the assessee was partly allowed by the Tribunal. The Tribunal directed the Assessing Officer to consider only the peak amount from the ...
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Tribunal allows part of assessee's appeal, directs assessing officer on peak amount inclusion. Inflation in stock figure dismissed.
The appeal by the assessee was partly allowed by the Tribunal. The Tribunal directed the Assessing Officer to consider only the peak amount from the undisclosed bank account for addition as income. The issue of inflation in the opening stock figure was not pursued by the assessee and was dismissed.
Issues: 1. Addition of Rs. 34,28,000 made by AO. 2. Discrepancy in the figure of opening stock.
Analysis:
Issue 1: Addition of Rs. 34,28,000 made by AO The assessee appealed against the addition of Rs. 34,28,000 by the Assessing Officer (AO). The primary contention was regarding two additions: Rs. 33,88,000 related to the assessee's undisclosed saving bank account with Surat National Cooperative Bank (SNCB) and Rs. 40,000 due to a discrepancy in the opening stock figure. The counsel for the assessee argued that only the peak amount of credit entries should be added as income, not the entire aggregate. The Department contended that the assessee failed to prove that the credit entries were from withdrawals made in the undisclosed bank account. The Tribunal noted that the SNCB account was not disclosed in the assessee's records or to the department. It held that only the peak amount should be added as income, directing the AO to determine the peak amount and restrict the addition accordingly. The Tribunal partly allowed this ground of appeal.
Issue 2: Discrepancy in the figure of opening stock No arguments were presented by the assessee regarding the addition of Rs. 40,000 due to inflation in the opening stock figure. Consequently, the Tribunal dismissed this part of the appeal related to the opening stock discrepancy.
In conclusion, the appeal by the assessee was partly allowed, with the Tribunal directing the AO to consider only the peak amount from the undisclosed bank account for addition as income. The issue of inflation in the opening stock figure was not pursued by the assessee and was thus dismissed.
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