TaxTMI 
TaxTMI 
2015 (2) TMI 411
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....the circumstances of the case, is erroneous. 2. The assessee firm, at the relevant time, carried on the business of textiles and garments sale. The Revenue surveyed its premises on 15.12.2006 under Section 133A of the Act. Discrepancies to the tune of Rs. 1,00,05,388/- in its accounts were found. Of that, Rs. 89,91,576/- was in the form of excess stocks and the balance constituted excess cash. The assessee surrendered this amount and incorporated them in the books of accounts. The final books produced during the course of hearing for the year ending 31.03.2006, disclosed that all these amounts were duly reflected. The assessee had filed a return claiming to be taxed for the sum of Rs. 42,44,290/-. Scrutiny assessment was completed and the ....
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....the present case was unwarranted. The ITAT's conclusions are extracted below: "6. We have heard rival contentions and perused the material available on record. From the documents filed by the assessee, it clearly emerges that assessee incorporated the entries of surrender in its books of accounts, prepared pre survey, post survey and final trading accounts and produced it before assessing officer during the course of assessment proceedings. Assessing officer asked for the justification of reduced income. Assessee attributed the same to discounted sales offered by the assessee after the survey, in the last one and half months of the accounting year. Assessing officer c....
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....bsp; 6.1. In view thereof, we quash the order of Commissioner passed u/s 263 of the Act." 7. In the result, assessee's appeal is allowed." 5. Learned counsel urged that the ITAT fell into error of law in holding that the premise upon which jurisdiction could be exercised under Section 263 did not exist. It was argued that the AO's order plainly accepted the assessee's assertions of the need to sell stocks at vastly depressed rates, even though such stocks had been purchased previously for considerably higher amounts. It was argued that the reasoning of the AO was unsupportable, and in addition, there was prejudice to the Revenue, which could be construed as erroneous within the expression of ....