TaxTMI 
TaxTMI 
2016 (9) TMI 17
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....year 2002-03, the revenue has preferred the present Tax Appeal. 1.1 This appeal was admitted by this Court on 04.05.2010 for consideration of the following substantial question of law: "Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in law and on facts in deleting the addition of Rs. 59,00,659/- made on account of difference in stock statement as furnished before the bank and the stock recorded in the books of account" 2. The issue involved in this case is addition of Rs. 59,00,659/- made on account of difference in stock as per books of accounts and stock as per stock statement submitted to bank. During the course of assessment proceedings, the Assessing Officer had observed ....
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....rsion is not acceptable in as much as the Tribunal has noted that there was no physical verification of the stock by the banking authorities as on 31st March 2009. Although much reliance was placed by the Assessing Officer and CIT [A] on the godown visit by the Bank Manager after closing of the year ie., on 25th April 2009, however, no physical verification and counting of the stock took place during such visit and even otherwise, the Bank Managers report indicates that 3000 tonnes of Coil was already included in the stock of the month of March 2009 and because of such inclusion, the stock position of March 2009 has shown the increase in quantity. It also found that the stock register was maintained by the assessee giving complete quantity ....
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.... If, for the purpose of fulfilling the margin requirements of the bank purely on inflated estimate basis, when the stock statement had reflected inflated value of the stock, in wake of otherwise satisfactory explanation, both - for the purpose of value as well as quantity, we find no reason to interfere with the order of the Tribunal. 10. As a parting note, it needs to be mentioned that the Tribunal also made an extensive exercise of calling for the financial ratios of seven years and of the current year under appeal and also held empathetically that after giving effect to the additions made by the Assessing Officer, the financial statement would get completely distorted; if such inclusion/ addition as made by the Assessing Officer is al....
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.... stock of various items as per stock register and as per stock statement submitted to the banks was duly noted by the Assessing Officer and therefore the Assessing Officer had rightly considered the same as unaccounted investment made by the assessee in stock. 7. Having heard learned advocates appearing on behalf of the parties and the question posed for consideration before us reproduced hereinabove and considering the decisions of this Court, the question which is raised in the present appeal is required to be answered in favour of the assessee. We are not giving further elaborate reasons for the same as in the case of Riddhi Steel and Tubes (Supra) it is held by this Court that only on account of inflated statements furnished to the b....