TaxTMI 
TaxTMI 
1997 (6) TMI 55
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....Shri Tarachand and his sons. Shri Tarachand is not a partner in the firm, but his family members are partners. In the course of search certain loose papers were found and seized. These loose papers reflected the closing stock of the assessee at Rs. 1,70,771.39 as on 31-3-1986. However, in its books of account the assessee had shown the closing stock at Rs. 1,00,771.39. The explanation of the assessee for this discrepancy was found to be vague by the Assessing Officer and hence the addition of Rs. 70,000 was made. The CIT(Appeals) confirmed the addition. 3. Shri Lajpat Rai, Advocate, appeared for the assessee. It was submitted by the ld. counsel that since the loose papers, on the basis of which addition was made, was found from the residen....
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.... have perused the material on record. We reject the first argument of the ld. counsel as regards the applicability of section 132(7). This provision pertains to the assets and not to books of account or loose papers. Secondly, they are not found to be in the possession of partners of the assessee firm. The next contention that as the loose papers do not bear the signature of the assessee, they cannot be taken note of. In our opinion, the reliance of the ld. counsel on the Supreme Court decision in S.P. Gramophone Co. 's case is totally ill-founded. In that case, the assessee wanted the revenue authorities to take note of its profit and loss account and balance sheet which were unsigned. It was in this context the apex court observed that su....
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....nder section 132(5). However, the order under section 132(5) is only a summary order to determine the likely tax liability of the assessee and accordingly to retain the seized assets. The final income obviously has to be determined under section 143(3) of the Act. In the course of assessment proceedings under section 143(3), the Assessing Officer cannot, pre se, make addition by taking recourse to the presumptions, because they are rebuttable presumptions. If the assessee is able to rebut the presumptions to the satisfaction of the Assessing Officer, then no addition would be made. However, if the assessee, after having afforded an opportunity, fails to avail of the same, or, while availing the same, the evidence in rebuttal is found to be ....