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of <h1>Tribunal Decision: Partial Appeal Success, Additions Restored for Unaccounted Investment & Sales</h1> The Tribunal partly allowed the departmental appeal by restoring the addition for unaccounted investment in purchases and GP on sales. The additions for ... - Issues Involved:1. Deletion of addition on account of unexplained investment in purchases.2. Deletion of addition on account of unaccounted income on sale of goods.3. Confirmation of addition on account of unrecorded expenditure for octroi payment.4. Confirmation of addition on account of unaccounted sales due to stock discrepancy.Summary:Issue 1: Deletion of Addition on Account of Unexplained Investment in PurchasesThe department challenged the deletion of Rs. 45,75,000/- added as unexplained investment in purchases. The assessee argued that the octroi duty of Rs. 1,01,000/- was charged due to irregularities found during a spot inspection by the Octroi Department on 17.7.99, not due to unaccounted purchases. The CIT(A) deleted the addition, stating there was no evidence of unaccounted purchases and the duty was paid on behalf of principal companies. The Tribunal upheld the department's view that the onus was on the assessee to show the purchases were recorded in the books. However, the Tribunal accepted that the entire investment could not have been made on a single day and restored an addition of Rs. 1,93,202/- as unaccounted investment in purchases.Issue 2: Deletion of Addition on Account of Unaccounted Income on Sale of GoodsThe CIT(A) deleted the addition of Rs. 1,37,250/- for unaccounted income on sales, following the deletion of the unexplained investment in purchases. The Tribunal, however, upheld the addition, reasoning that the assessee earned GP on the sale of these goods.Issue 3: Confirmation of Addition on Account of Unrecorded Expenditure for Octroi PaymentThe CIT(A) confirmed the addition of Rs. 1,01,000/- for octroi duty paid, as it was not recorded in the books even after four months. The assessee's claim of taking a loan from family members for the payment was unsupported by evidence. The Tribunal upheld this addition.Issue 4: Confirmation of Addition on Account of Unaccounted Sales Due to Stock DiscrepancyThe CIT(A) held that only GP @ 3% amounting to Rs. 2,378/- could be taxed from the unaccounted sales resulting from a stock shortage of Rs. 79,266/-. The Tribunal, however, upheld the full addition of Rs. 79,266/- as the assessee failed to explain the stock deficiency.Conclusion:The Tribunal partly allowed the departmental appeal, restoring additions for unaccounted investment in purchases and GP on sales while upholding the additions for octroi duty and unaccounted sales due to stock discrepancy.
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