Narayan Dalmia Vs ITO (ITAT Kolkata)
ITAT Kolkata Remands Matter: Survey Statement Alone Cannot Sustain Addition Without Stock Verification
In this appeal, Assessee challenged the addition made by AO based solely on a statement recorded during survey u/s 133A, where Assessee had agreed to pay ₹8,00,000 as advance tax on alleged additional income. Tribunal noted that although Assessee made such a statement, the return of income was filed strictly as per books, explaining that the stock register had not been updated on the survey date due to absence of the accountant, but was later corrected & incorporated in the return. Except the stock difference, no incriminating material was found during survey.
AO, however, treated the advance-tax commitment as “undisclosed income”, added ₹14,50,666, & assessed total income at ₹35,10,815 without examining stock records or other business documents. CIT(A)/NFAC dismissed the appeal ex-parte stating that no supporting documents were filed.
Tribunal observed that Assessee had claimed before it that stock register & other records were in fact produced before AO but not considered, whereas before Tribunal also Assessee could not furnish the same. Holding that the assessment required proper verification of stock records & books, Tribunal restored the matter to AO for fresh examination with one final opportunity to Assessee. Tribunal cautioned that non-cooperation may result in assessment based on available material. The appeal was allowed for statistical purposes.
