Case Law Details
The assessee is engaged in the business of trading in chemicals. The sales shown in the Profit & Loss Accounts were Rs. 3,15,85,478/- and against that purchases were shown as Rs. ,93,31,117/- on which gross profit of Rs. 7.95% was declared. The assessee was required to submit month-wise details of sales and purchases according to which the total sales were reported at Rs. 3,22,81,924/- and purchases were reported at Rs. 3,04,17,709/-. Thus, it was observed by the Assessing Officer that there was a difference of Rs. 6,96,447/- in the sales and Rs. 10, 86,596/- in the purchases.
The assessee was required to explain the same and the assessee tried to explain the difference by reducing the GP @ 8% and on these calculation the Assessing Officer observed that the shortage of stock available for sale with the assessee in the month of May, 2005 was to the extent of Rs. 71,835/- and, therefore, the Assessing Officer observed that the assessee had made sales out of the books. Similarly, in the month of November, 2005 the Assessing Officer noticed that sales were made to the tune of Rs. 28,39,639/- against the available stock of Rs. 20,27,795/- which also resulted in the shortage of stock of Rs. 5,84,672/-. He further found that during the month of December, 2005 to March, 2006, according to the purchases and sales made by the assessee, the stock available with the assessee was Rs. 18,67,797/- against which the closing stock was disclosed only at Rs. 9,38,250/-. The Assessing Officer made addition of the difference between these two which has been computed at Rs. 9,29,547/- being the difference in stock as at the end of the year. The Assessing Officer asked the assessee to explain the same and the assessee submitted the reconciliation and the sales included the sale return as well as the purchase return. The Assessing Officer did not believe the explanation of the assessee on the ground that prior to that this explanation was not furnished by the assessee and he has added the said amount to the income of the assessee. Similarly, on the excess sales which was found to be made by the assessee in the month of May and November, 2005, the Assessing Officer has computed 8% gross profit on these sales of Rs. 6,96,447/- and further addition of Rs. 55,715/- has been made.
we are of the opinion that the difference which was pointed out by the Assessing Officer has been explained by the assessee and learned CIT (A) has rightly held that the difference has been explained by the assessee. In this view of the situation, we decline to interfere in the relief given by the learned CIT (A). As the main addition was not sustainable, there was no question of applying any GP rate on the sales which have been allegedly found to be short by the Assessing Officer.
INCOME TAX APPELLATE TRIBUNAL, DELHI
ITA No. 4450/Del/2011 – Assessment Year :2006- 07
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My question on while assessee has shown the Contract Receipt and TDS not match then what will happen. If TDS on NSDL site wrong showing