2024 (2) TMI 1629

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....in filing the appeal is condoned. 3. Application is disposed of. ITA 566/2019 4. We have heard Mr. Menon, learned counsel appearing in support of the appeal. The Department seeks to question the correctness of the decision rendered by the Income Tax Appellate Tribunal ["ITAT"] dated 22 February 2018. They have for our consideration proposed the following questions of law: A. Whether the ITAT has erred in law and on facts in confirming the Commissioner of Income Tax (Appeals)'s ["CIT(A)"] deletion of Rs. 3,38,58,247/- and in allowing further relief of Rs. 1,02,10,375/- by accepting the assessee's change of method of valuation of stock to the cost price following FIFO method without considering the fact that the assessee had....

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....s and around 800 grams are lying with him for repairing. In Question No. 13 he disclosed Rs. 4 crores as additional income on account of difference in the stock. Consequently, he also gave the break-up of disclosure of 44079512.09 in his revised return. The ld Assessing Officer on query was explained by the assessee that total quantity of jewellery found was 188599 grams, goods received for approval is 28866.60 grams, goods received for repairs is 8015.490 grams and therefore, the excess stock is only 81691.389 grams. The revenue has taken its value at Rs. 57169471/- where the assessee has taken its value at Rs. 4744079512/-. Therefore, the revenue is challenging the adjustment in the quantity of gold given by the ld CIT(A) of goods receive....

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....e Assessing Officer was asked to comment in remand proceedings and the ld AO could not show any Infirmity in these details submitted by the assessee. The ld DR also could not show that what is the error made by the assessee in the reconciliation statement submitted qua the quantity. We have also verified the reconciliation statement and we also find that such kind of difference is possible at the time of search in case of a jeweller who is engaged in the trading, repairing as well as recording sales on approvals. May that be the case but despite showing and making a statement with the evidence which is not refuted by the revenue it is not possible to reject the same and refuse to grant credit of or/adjustment of such quantities. Therefore, ....

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.....68 per grams. Based on this the assessee has worked out the total disclosure of Rs. 44962675/-. It is not disputed by the revenue that the quantity of gold or gold ornaments are different. According to section 69 of the Act the valuation is required to be taken according to the investment made by the assessee but the nature and source of such investment are not explained. In fact the investment made by the assessee has been shown at a particular rate which is at cost only. This is also an accepted method of valuation by the assessee as already decided in the case of the assessee from Assessment Year 2000-01 to 2005-06 in ITA No. 3132 to 3137/Del/2008. In the present case the assessee has taken the average cost price which was the claim of ....