2010 (7) TMI 1070

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....ash balance though the same was covered against undisclosed income of ₹ 3,00,000/- as disclosed in the return of income as per para 10 of the appeal order. (3) The ld. CIT(A) grossly erred in confirming addition of ₹ 45,000/- on account of unaccounted sales as per para 13 of the appeal order. (4) The ld. CIT(A) grossly erred in confirming addition of ₹ 7,31,600/- on account of unaccounted service charges as per para 13 of the appeal order. (5) The ld. CIT(A) further erred in confirming addition of rs.50,000/- on account of unaccounted AMC as per para 13 of the appeal order. 2. The ld. AR did not press ground Nos.3 & 5 and hence they are rejected as not pressed. 3. The facts of the case are that the assessee com....

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....condly the stock as per books was worked out by assuming 39% of direct expenses. Accordingly the assessee at his own declared an additional income of ₹ 3,00,000/- in profit and loss account on account of profit on shortage of stock presumed to have been sold. The AO, however, did not agree and proposed entire addition of ₹ 16,20,850/-. The entire amount was treated as sales and was added in the trading account resulting in the addition to profits to that extent. 6. Ld. CIT(A) confirmed the action of the AO on the ground that purchases relating to these sales are already recorded in the books. 7. Against this, ld. AR submitted that only profit on such deficiency in stock should be considered as income and not entire shortage of....

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....unt of shortage of cash can be made. The ld. DR could not bring out any authority in support of the proposition that shortage of cash can be treated as income of the assessee. Accordingly this addition is deleted. This ground is allowed. Unaccounted service charges 13. The AO found a note book as per Sl. No.3 of Annexure-A impounded by the officer which contained details of service charges on R.O. instrument received by the assessee during the period 1.1.2004 to 9.3.2004. This was worked out at ₹ 1,43,320/-. This was extra polated for entire year and total unaccounted service charges received by the assessee was estimated at ₹ 7,31,600/-. The ld. CIT(A) confirmed the addition on the ground that above receipts represented unacco....