TaxTMI 
TaxTMI 
2025 (2) TMI 1460
X X X X Extracts X X X X
X X X X Extracts X X X X
.... before the AO during the course of remand proceedings. 2. On the facts and circumstances of the case and in law the addition of Rs. 4,96,60,427/- being value of alleged undisclosed excess stock found during the course of search proceedings in the appellant's case has resulted in double taxation as the appellant had duly accounted the purchase of impugned stock in his books of accounts alomngwith the corresponding sales and duly offered the profits resulting from such transaction as his business income in his return of income and the books of accounts of the appellant had not been rejected and therefore, the impugned addition must be deleted. 3. On the facts and in the circumstances of the case and in law the ldCIT(A) erred in upholding the valuation of alleged undisclosed excess stock found during the course of search in appellant's case at "Market Value" and not at its "Cost" The appellant also craves to raise following grounds of appeal over and above the grounds of appeal raised before the ld.CIT(A). 4. On the facts and circumstances of the case and in law, the impugned assessment order u/s 143(3) of the Income Tax Act, 1961 dated 29-09-2021,....
X X X X Extracts X X X X
X X X X Extracts X X X X
....stered valuer at the market price only and necessary deduction were allowed according to purity of the product and valuation was made only for the pure quantity, hence the valuation of business stock cannot be made on the basis of cost price shown in the bills. The valuation of the total stock was made by the valuer on the basis of purity of the items of business stock not of on the basis of total weight of the items of total stock, hence the cost price cannot be accepted. On the basis of above discussion, the purchase bills produced by the appellant for purchase made on 01.04.2019 and 02.04.2019 during the post search investigation were without any real transaction and arranged only to justify the excess Stock. The above purchase bills cannot be relied upon as the same were only after thought and do not match with the business trends of the appellant. Hence the AO was justified to make an addition of Rs. 4,96,60,427/- on account of excess stock found. The AO was justified to make addition after allowing the opening stock of Rs. 10,25,874/- as per ITR for the FY 2018-19, the purchase bills produced by the appellant for Rs. 44,43,733/- and allowing the credit of Rs. 7,40,00....
X X X X Extracts X X X X
X X X X Extracts X X X X
....was Rs. 3,17,68,537/- and silver bullion and jewellery was Rs. 2,41,01,497/- i.e. total valuation of stock was Rs. 5,58,70,034/-. 4. Further, during the course of search proceedings, the assessee could only produce a few bills available with him, as the remaining bills were with Shri Mukesh Ranka, nephew of the assessee and key managerial person of Anand Jewellers, who generally received the bills. Moreover, at the time of search i.e. on 03.04.2019, the F.Y. 2018-19 had just ended a few days prior on 31.03.2019 and due to the festive season of Akshay Tritiya the books of accounts of the assessee were not complete for want of closing of accounts as on 31.03.2019. Therefore, all the jewellery and bullion found during the search, was yet to be recorded in the books of accounts at the time of search. 5. Subsequently, in post search investigation conducted by the Investigation Wing, Udaipur, the assessee had duly produced the supplier invoices and reconciliation of stock found at the time of search, and further the statement of assessee was recorded by the investigation wing dated 09.07.2019. 6. In the statement recorded under section 131 of the Act, dated 09.....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... reply to 142(1) Quantity Rate per grams Amount Closing Stock as on 31.03.2019 Gold Bar Gold Bar 660.1 2860.0 18,87,880 Gold Oranments Gold Oranments 1017.98 2858.0 29,09,387 Purchase from 01.04.2019 to 03.04.2019 Gold (in grams) Charbhuja Ornaments Gold Oranaments 852.17 2819.2 24,02,413 DG Jewels Gold Bar 200.00 3165.1 6,33,010 DG Jewels Gold Oranaments 862.18 2822.5 24,33,471 Gayatri Corporation Gold Oranaments 2,400.50 3050.2 73,21,933 Prince Orna Gold Bar 200.00 3165.1 6,33,019 Prince Orna Gold Oranaments 825.72 2821.8 23,30,010 Rishva Gems and Jewellery Gold Oranaments 630.50 2819.7 17,77,820 S M Jewels Gold Oranaments 671.00 2821.7 18,93,393 S M Jewels Gold Oranaments 475.20 2818.8 13,39,515 Shailbhadra Orna Gold Oranaments 905.00 2825.8 25,57,330 Closing Stock as on 03.04.2019 Gold (in grams) 9....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 34.28 11,14,100 Shree Sava Jewellers 25.22 8,19,650 Shree Sava Jewellers 26.75 8,69,375 Closing Stock as on 03.04.2019 Silver (in kilos) 633.45 1,88,14,562 1,88,14,562 17. Further, in the CIT(A) order, it was stated that the goods were returned to some of the parties at times. In this connection, it is submitted that the assessee is engaged in the business of gold and jewellery, where market trends change rapidly. To attract customers, the assessee must continuously update its inventory with new designs. 18. Unsold designs or those requiring modifications are either returned or exchanged. Additionally, in cases where a purchaser identifies a customer with the same requirements as the previously sold goods, they may buy back the goods from the assessee. The assessee earns the difference in valuation of gold, which is duly offered for taxation. This practice not only facilitates inventory rotation but also ensures optimal utilization of store space for new designs. 19. Therefore, the assumption by the CIT(A) that the transactions are not genuine as the goods were sold to the same p....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... क.स.आ.आ./के.यू/अज./2024-25/670 दिनांक: 04.02.2025 To The Commissioner of Income-tax (DR) Income-tax Appellate Tribunal, Jaipur. (Through the Addl. CIT, Central-Range, Udaipur) Respected Sir, Sub: Calling for factual report in the case of Shri Goutam Kumar Ranka, PAN- AHNPR5761K, A.Y.2020-21, Appeal Number ITA/1487/JPR/2024-Regarding Kindly refer to above, on the above cited subject. 2 In this connection, it is submitted that as par facts available on record, the factual report in the case of Shri Goutam Kumar Raznika for AY 2020-21 is being submitted as under- 3. Assessment proceeding u/s 143(3) was completed on 29.09.2021 and disposal of the same was made through manual upload process on ITBA portal. In this regard, intimation for completion of the assessment proceedings was generated through DIN on 31.03.2022 vide No. ITВА/COM/8/91/2021- 22/1036211186(1) after obtaining necessary approval required u/s 153D of the Act from the competent authority. Copy of the above intimation and ap....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t, the assessee filed a rejoinder clarifying that the other 5 parties have also physically/ e-filed the requisite replies in compliance to the notice u/s 133(6) of the Act along with the confirmations, bank statement and GST details and submitted the proof of the reply letters filed by the parties. It is noted that the ld. CIT(A) after considering the submission of the assessee, the remand report of the AO, rejoinder of the assessee decided the case against the assessee by confirming the addition made by the AO. The ld. CIT(A) observed that the assessee had introduced the new parties and bills to cover up the excess stock found in the search which according to him was only an afterthought. The ld.CIT(Appeal) has also observed that the assessee could not produce the bills during the course of search action on the assessee and had also accepted the excess stock and its valuation arrived at by the registered valuer. Accordingly, on the basis of the statement recorded at the time of search, the ld. CIT(A) confirmed the addition of the AO. It is noted that in the course of proceedings before us, the Ld. AR argued that the assessee has discharged the onus of proving the excess stock foun....