TaxTMI 
TaxTMI 
2023 (7) TMI 1159
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....essee reads as under:- 1. The order of the learned Commissioner Of Income Tax (Appeals)- 18, is wrong, illegal and is opposed to law. 2. The Ld. Commissioner of Income Tax (Appeals)-18 erred in uploading the order of assessment by assessing the business income offered by the appellant as unexplained investment under section 69B r.w.s 115BBE of the Income Tax Act. 3. The Ld. Commissioner of Income Tax (Appeals)-18 ought to have seen that addition under section 69B r.w.s 115BBE of the Income Tax Act is warranted only if the twin condition that the excess stock found at the time of survey in not recorded in the books of account and the appellant offers no satisfactory explanation. In the instant case the appellant has offered satisfactor....
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.... AR made arguments to submit that the addition arising out of excess stock found was nothing but business income of the assessee. The Ld. Sr. DR controverted the arguments of Ld. AR and placed on record survey report. The Ld. Sr. DR submitted that the impugned income has rightly been assessed as Income from other sources. Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under. Proceedings before lower authorities 2.1 The assessee being resident firm is stated to be engaged in sale of gold jewellery and silver articles. The assessee was subjected to survey u/s 133A on 11.10.2018 wherein the physical stock was inventorized and it was noted that there was excess stock available to the extent of R....
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....hase credit and therefore the same could not be treated as unexplained investment. 2.3 Rejecting the submissions of the assessee and relying on the decision of Hon'ble High Court of Madras in the case of M/s SVS Oil Mills vs. ACIT (ITA No.765 of 2018), Ld. AO held that the excess stock was to be treated as unexplained investment u/s 69B which would be subjected to higher rates as prescribed u/s 115BBE. 2.4 During appellate proceedings, the assessee submitted that the assessee was not carrying out any other business. The stock difference arose during the course of day-to-day business activity and not otherwise. On the date of survey, the excess stock was not separately identified. The entire stock was available as trading stock at the busi....
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....it emerges that the only source of assessee's income is 'Business income' arising out of sale of gold jewellery and silver articles. During survey proceedings, quantitative differences were found in the physical stock vis-à-vis book stock. The assessee brought the same into books of account by way of credit to partners' capital account with corresponding increase in book-stock. The excess stock was included in the stock register. Accordingly, the differential was separately offered to tax in the return of income as 'Business Income'. Naturally, the excess stock was acquired out of excess income regenerated from business activity only since the assessee do not have any other source of income since its inception. The entire stock was a....