TaxTMI 
TaxTMI 
2015 (9) TMI 60
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....nt was prepared on the date of survey which divulged the figure of stock at Rs. 84,54,300/-. Physical verification was carried out of the stock available on that date with the help of the assessee's employees. As per such verification, the stock of the assessee came to Rs. 1,16,39,952/-. This disclosed excess stock to the tune of Rs. 31,85,652/-. Statement of Shri S.K. Vasudevaji, Chief General Manager of the assessee-firm was recorded at the time of survey, in which he was asked to explain the difference in stock amounting to Rs. 31.85 lac. He had no explanation to offer in respect of the discrepancy and, accordingly, agreed for taxation of the amount of excess stock to the tune of Rs. 31.85 lac. A partner of the assessee-firm, namely, Shr....
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....f the item, quantity, rate and value. A copy of such detailed inventory prepared on 5.12.2003 is available on pages 26-30 of the paper book. However, it is only later on during the course of assessment proceedings that the assessee came out with a statement showing difference in the rates, a copy of which is available on pages 31 onwards of the paper book. When we consider the contents of the items in the stock statement prepared at the time of survey, it can be seen that these are in the nature of Dress material, Men's shirt, Ladies' top, Girls' pant, Blouse, Capri with blouse, etc. It is obvious that the prices of such items vary depending upon its quality, etc. A piece of shirt may be available for Rs. 100/- and also for a couple of thou....
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....ssee company, as approved firstly by its Chief General Manager on the date of survey and then by a partner after a week's time, can be branded as wrong at a later date. It is more so because there is no corroboration of the rates given by the assessee in its later statement showing lower rates. There is no basis for checking the rates given by the assessee in its so-called inventory depicting difference in the rates of items. When the stock statement prepared by the Incometax authorities at the time of survey is pitted against a later one-sided statement with lower rates made by the assessee, we prefer to go with the former. The reason is obvious that it was drawn on the basis of actual verification done and as per the rates given by the em....
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....during the immediately preceding year and year in question. The assessee tried to justify reduction in the gross profit rate by giving the reasons which have been reproduced on page 5 of the assessment order. The AO discussed point-wise contentions raised by the assessee. In the ultimate analysis, it was found that the assessee had not maintained any quantitative details of raw material and finished goods as was apparent from the audit report and the details furnished during the course of assessment proceedings did not give the details of accessories/other raw materials; various types of garments manufactured; details of semi-finished and finished goods and wastage, etc. He, therefore, refused to give any credence to the quantitative statem....