Case Law Details
Brij Mohandas Devi Prasad Vs ACIT/DCIT (ITAT Indore)
ITAT Indore held that excess stock was not kept separately and was part of business stock cannot be treated as deemed income u/s 69 or 69B of the Income Tax Act. Accordingly, provisions of section 115BBE of the Income Tax Act are not applicable on the surrendered income on account of excess stock found during the course of search.
Facts- During survey, the statement of assessee’s partner Shri Deepak Soni were recorded wherein, he surrendered excess stock of Rs. 2,97,55,184/- and excess cash of Rs. 5,82,644/-; both aggregating to Rs. 3,03,37,828/-.
Thereafter, while filing return of income of relevant AY, the assessee faithfully honoured the surrender made by partner and disclosed additional income of Rs. 3,03,37,828/- as “Income from Business” u/s 28 and paid taxes @ normal rate of tax as applicable to business income.
During assessment-proceeding, AO accepted the additional income of Rs. 3,03,37,828/- as declared by assessee but assessed the same u/s 69/69A and thereby applied higher rate of tax u/s 115BBE. CIT(A) confirmed the action of AO. Being aggrieved, the present appeal is filed.
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