TaxTMI 
TaxTMI 
2022 (6) TMI 1491
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....aid addition and did not considered daily manufacturing report filed by the appellant. It is prayed that the addition of Rs. 30,966/- may please be deleted as correct facts have not been considered by A.O. 2. That on facts and in law the AO was wrong in addition of Rs. 2,65,46,540/- on a/ c of Sugar ( being difference between books of account and physical verification in various units), the ld. CIT ( A) upheld the same by confirming the said addition and did not considered daily manufacturing report filed by the appellant. The Ld. CIT ( A) did not consider the merits of the arguments filed by the appellant. It is prthat the addition of Rs. 2,65,46,540/- may please be deleted considering the material on record and facts of the case. 3. T....
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....ontested before us are as under: Nature of Addition Amount Difference in Stock of Sugar from the books Rs. 2,64,06,668 /- Difference in Stock of Molasses from the books Rs. 9,79,336 /- Sale of Press Mud Rs. 30,966 /- Difference in cash found and Cash Book Rs. 13,10,388 /- Difference in Stock : 6. The AO made an addition of Rs.2,65,46,540/- on account of difference between books of accounts and physical Stock of Sugar at different units. It was argued that there was no 'actual difference' in stock but only a discrepancy as Production on the day of search could not be entered in books which were seized. 7. The pertinent facts as per the revenue are as under: Unit Stock as per Pysical Verification on 08-0 4-2010 (....
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....ster (RG-1 ) for Libberheri Unit for Season( s) 2009 - 10, 2008 -09-2007-08 Barkatpur Unit: PB 128 Is the copy of the Daily Manufacturing Report ( DMR) of Barkatpur Unit showing production of 5700 Qtls. of Sugar, Molasses which could not be entered into the daily stock register, which we seized PB 129 -132 Is the copy of the Stock Register (RG-1 ) for Barkatpur Unit for 2009 - 10 & 2008 - 09 9. The production of sugar, which is a continuous and requires multiple simultaneous processes leads to regular inflow of sugar, and the entry in the books is done for a day as a single entry. 10. In the instant case, the said entry of sugar production on 07.04 .2010 could not be done, due to the seizure of books by the department, whereas....
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....gar are in tune with average daily production. In view of the entirety of the facts narrated above, we hold that no addition is called for on account of difference in the stock of sugar. Difference in Molasses: 12. The AO made addition on account of difference in the stock of molasses [( AO Page 11, CIT( A) Page 130] Stock ( in Qtls.) Libberheri, Roorkee Barkatpur, Bijnore Khaikeri, Muzaffarngar Shermau As per Books 175,172 2,12,440 45,049 34,189 As per Physical Verification 1,75,711 2,14,444 45,58 6 34,300 Alleged Difference 538 ( 0 31 %) 2004 ( 0 94 %) 53 6 ( 1 1 %) 110(0.32 %) 13. Molasses stored in a tank, is measured by taking a dip and a slight deviation is scientifically possible while taki....
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....t different premises of the assessee-company {(AO Pg. 14, 15, 16, CIT( A) Pg 20 )}. 15. Before us, it was submitted that certain vouchers pertaining to cash transactions undertaken on 06 04.2010 ( day prior to search) were not updated in the cash book which led to the difference in cash found and the books. 16. The said fact of the vouchers not being updated in the cash book was even confirmed by an employee of the assessee- corporation, Sh. Mahesh Patel, at the time of recording of his statement u/ s 132 ( 4 ) itself ( Pg. 158 PB). However, the same was not considered while making the assessment. The assessee before the AO and ld. CIT( A) submitted a reconciliation justifying that there was no ' actual difference'. Libberheri: 17. Cash....
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.... be entered into the books + Rs. 584 /- Physical Cash Found Rs. 4,51,320 /- Noida: 19. Cash as per books amounted to Rs. 2,89,700/- and physical cash aggregating to Rs. 4,89,000/- was found. The difference of Rs. 1,99,700/- was added to the income. The reconciliation statement is as under: Cash as per books 2,89,700 Add:- C ash received from Libberheri Roorkee Unit on 06 04 2010 but voucher was pending for entry I n books ( PB 1 27 ) + 2,00,000 L ess:- Payment Vouchers pending to be entered in the books ( 110 + 90 ) ( PB 15 5, 156 ) - 300 Physical Cash 4,89,400 /- 20. We have perused the reconciliation statements along with the details in the paper book. All these amounts are pertaining to expenses and transacti....