Case Law Details
Shri Akashoy Das, L/R of Late Amal Das (Deceased) Vs ITO (ITAT Kolkata)
ITAT held that addition of such types which are made during the course of survey on oath cannot be made unless there is a supporting material. In our opinion, the addition on estimated basis cannot be justified for reasons, the AO has not rejected the books of account.
ITAT finds that the survey u/s 133A of the Act was on the business premises of assessee on 31.10.2013. During the course of survey, excess stock was determined at Rs. 35,85,955/- and after making allowance towards profit as the inventory was taken at selling price, a net addition of Rs. 22,62,597/-, was made. Similarly the unaccounted sale of Rs. 1,23,067/- found during survey were added by the AO. We note that the AO could not pin point any discrepancy in the books of accounts produced by the assessee during the assessment proceeding. It was also brought to the notice of the AO that inventory taken by the survey team was taken on estimation and was not correct.
ITAT notes that the AO simply brushed aside the plea of the assessee that these stocks and sales as found during the survey were duly recorded in the books and income was determined and return of income was filed accordingly.
ITAT further finds that the AO has not rejected the books of accounts of the assessee and AO failed to point out any defect or deficiency in the same. In our opinion, the AO Akashoy Das cannot make the additions without rejecting the books of accounts and without pointed out specific defects. The assessee has been claiming that correct amount of stocks and sales were recorded in the books which were produced before the AO and the AO has failed to point out as to how the books of account were not correct. Similarly the Ld. CIT(A) has held that amount of undisclosed stock and sale were not accounted by the assessee without giving any findings as to how the books of account produced by the assessee were not correct.
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