2010 (1) TMI 814

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....of this appeal, is-whether the learned CIT(A) and the Tribunal were justified in deleting the addition made by the AC) on the ground that the excess stock, as returned to the bank, was corresponding to the sales not declared to the bank in the form of sundry debtors, the assessee has only availed extra credit facility, which did not relate to the discrepancy in stock?   3. Briefly stated, facts of the case, as projected in the impugned order of the Tribunal, are that the assessee is a trader in iron and steel. The assessee maintained regular books of accounts including stock register etc. on computer. Books of accounts were also produced before the AO for examination. The AO enquired from the bankers of the assessee and obtained cop....

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....esult of which higher stock was shown to the bank. However, this fact was not submitted by the assessee before the AO at the time of assessment.   CIT(A), considering the explanation of the assessee and remand report submitted by the AO, held that there was no excess stock available with the assessee at any point of time and therefore, there is no case for addition, and accordingly, the addition was deleted.   5. The Revenue went up in appeal and the Tribunal affirmed the order of CIT(A).   6. Shri Rajeev Shrivastava, learned counsel for the appellant/Revenue, submits that the statement given to the bank by the assessee is admissible as evidence as per s. 4 of the Bankers Books Evidence Act, 1891 and CIT(A) and the T....

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....of the assessee that the inflated stock was shown in the statement before the bank by reducing the sales figure and there was no discrepancy in the stock if the sales figure and balance of stock are considered in the bank statement as well as in the books of accounts, remanded the matter along with copy of submission made by the assessee before CIT(A) to the AO as per order under s. 250(4) of the Act, and this fact was subsequently confirmed by the AO.   11. In Prem Singh and Co. (supra), an identical question arose before the Delhi High Court, wherein the Tribunal deleted the addition made on the basis of difference in the position of stock as disclosed by books of accounts and as shown in the account of stock hypothecated with the....