Case Law Details
ACIT Vs Bholanath Agarwal (ITAT Kolkata)
ITAT Kolkata held that disclosure of undisclosed income under IDS, 2016 on which taxes are duly paid cannot be further added as undisclosed stock. Claim of set off of undisclosed income duly available against the undisclosed stock surrendered during the course of survey.
Facts- AO observed that the assessee has shown closing stock as on the date of survey i.e. 18.07.2015 at Rs. 3,01,59,910/- in its books of accounts but the actual closing stock found during the course of survey was Rs. 1,00,53,929/- and, therefore, there is a discrepancy of Rs. 2,06,08,009/-. Before, AO, it was stated by the assessee that it had made IDS, 2016 declaring Rs. 1,09,02,800/- and there was an addition in assessment for AY 2011-12 at Rs. 92,03,181/- and both these amounts were included as part of the closing balance as on 18.07.2015 in its books of accounts. However, ld. AO was not satisfied and he made the addition for undisclosed stock at Rs. 2,06,08,009/-.
Aggrieved, the assessee preferred appeal before ld. CIT(A) and succeeded in getting relief. Aggrieved, the Revenue is now in appeal before this Tribunal.
Conclusion- Regarding the set off of Rs. 92,03,181/- the addition was made in the hands of the assessee in the assessment order for AY 2011-12 vide order dated 19.02.2016 framed u/s 147 r.w.s. 143(3) of the Act. This assessment was completed after the date of survey i.e. 18.07.2015 but before the conclusion of the assessment proceedings for AY 2016-17. The said sum has been added in the hands of the assessee and the assessee had accepted the said addition by not challenging it before the higher appellate authority and thus, the same is deemed to be available with the assessee as a part of the undisclosed stock found during the course of survey. Also we find support to this proposition by the judgement of Hon’ble Jurisdictional High Court in the case of Balaram Saha vs. CIT, I.T. Appeal No.319 of 2003, dated 19.04.2011. Therefore, ld. CIT(A) has rightly allowed the claim of set off of Rs. 91,98,488/- against the undisclosed stock.
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