2010 (7) TMI 627

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....f Rs. 26,00,000 made by the Assessing Officer as difference in valuation made by the approved valuer and stock inventory prepared physically during the course of survey under section 133A whereas the difference in stock was accepted by the assessee and itself offered for taxation during the year under consideration." 3. The Assessing Officer made the assessment under section 143(3) of the Act vide order dated 18-12-2007 against the present assessee treating the assessee as firm. In the assessment order, the Assessing Officer has stated that a survey under section 133A was carried out at the business premises on 24-2-2005, in the course of which, it was revealed that the firm M/s. Vishal Jewellers was dissolved with effect from 7-5-2004, ....

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.... that the firm M/s. Vishal Jewellers was dissolved with effect from May 6, 2004 and the closing stock as on May 6, 2004 was taken over by the company M/s. Vishal Gold and Precious Stones (P.) Ltd. The survey under section 133A of the Act was conducted by the Assessing Officer on February 24, 2005 when the entity firm was not existing. The inventory of the stock was prepared and treated as stock belonging to the firm. During the survey the physical inventory of the stock was prepared and the position was as under : 18 Ct. 22 Ct. Diamond/stone 6902.701 46604.906 1658.003 The stock as per books of account of M/s. Vishal Gold and Precious Stones (P.) Ltd. is as under : 18 Ct. 22 Ct. Diamond/stone 6902.701 466....

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.... 4.2 The addition made by the Assessing Officer at Rs. 26 lakhs is, therefore, deleted." 5. Hence, the Department is in appeal before us. 6. We have heard both the parties and perused the material on record. It is clear from the assessment order itself that this firm M/s. Vishal Jewellers stood dissolved with effect from 6-5-2004, and the closing stock as on 6-5-2004 was taken over by the company, M/s. Vishal Gold and Precious Stones Ltd. It is also not in dispute that the survey under section 133A was conducted on 24-2-2005 at the business premises certainly belonging to M/s. Vishal Gold and Precious Stones (P.) Ltd., as the present firm was not existing at that point of time. The Commissioner of Income-tax (Appeals) has noted the ....