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of <h1>Tribunal rules in favor of taxpayer, rejects Revenue's appeal on sundry creditors & stock valuation</h1> <h3>Income Tax Officer Versus Shri Surendra Singh Malhotra</h3> The Tribunal dismissed the Revenue's appeal, upholding the deletion of additions made by the Assessing Officer regarding sundry creditors and stock ... - Issues involved: Appeal against order of ld. CIT(A) for Assessment Year 2007-08 regarding deletion of additions made by Assessing Officer.Issue 1 - Sundry Creditors Verification:The assessee declared sundry creditors at the end of the relevant year. The Assessing Officer considered some creditors as bogus under section 68 of the Act due to lack of verification and non-response to notices. The ld. CIT(A) deleted the addition stating that the creditors were old and confirmed. The Revenue contended that the creditors should be verified. The Tribunal held that old creditors cannot be subject to addition u/s. 68 and dismissed the Revenue's appeal.Issue 2 - Stock Wastage and Addition:The Assessing Officer added the value of Draw Pipe stock to the income of the assessee due to claimed wastage and nil closing stock. The ld. CIT(A) deleted the addition as the business was closed, and the scrap sales were duly recorded. The Tribunal found no defects in the books of account and upheld the deletion of the addition, stating that double additions were not permissible under the law.Conclusion:The Tribunal dismissed the Revenue's appeal, upholding the deletion of additions made by the Assessing Officer regarding sundry creditors and stock valuation, emphasizing the acceptance of old creditors and proper accounting for scrap sales.
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