Case Law Details
Pr. CIT Vs Gladder Ceramics Ltd. (Gujarat High Court)
Tribunal has compared the stock statement for the year under consideration as per the books of accounts and as submitted to the bank and has found that there was no difference in the stock so far as the quantity is concerned. It was the case of the assessee that it is common practice to give inflated valuation to the bank to avail cash credit facilities which are invariably given on the hypothecation of the stock. It was also the case of the assessee that the price as shown in the books of account was in terms of the cost price and in the statement submitted to the bank was at the market price and hence, there was a difference. Both the Commissioner (Appeals) and the Tribunal have concurrently found that there is nothing on record to show that the bank officials have physically verified stock as on 31.3.2010 and were of the view that on account of inflated statements furnished to the banking authorities for the purpose of availing of larger credit facilities, no addition can be made if there appears to be a difference between the stock shown in the books of accounts and the statement furnished to the banking authorities. More so, when the stock statement given to the bank reflects inflated value of the stock otherwise there being no difference in the quantity. In view of the fact that both, the Commissioner (Appeals) as well as the Tribunal have recorded a concurrent finding of fact that there was no difference in the quantity of stock as reflected in the books of account and in the statement submitted to the bank, it is not possible to state that the conclusion arrived at by the Tribunal suffers from any legal infirmity.
FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT
1. The appellant-revenue in this appeal under section 260A of the Income Tax Act, 1961 (hereinafter referred to as “the Act) has challenged the order dated 23.1.2017 made by the Income Tax Appellate Tribunal, Ahmedabad Bench “A” (hereinafter referred to as “the Tribunal”) in ITA No.386/Ahd/2014, by proposing the following two questions stated to be substantial questions of law:
“[A] Whether the Appellate Tribunal erred in law on facts in deleting the addition of Rs.1,19,23,142/- under section 69B of the Act?
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