DCIT, CC-2, JAIPUR, JAIPUR vs. BHURAMAL RAJMAL SURANA(MFRS), JAIPUR

The brief facts of the case are that a search action was carried out at the premises of the assessee, during which the assessee surrendered certain amount of income on account of valuation of the stock of the assessee by the Departmental Valuer at a higher price, than that was declared in the books of accounts, by the assessee. The assessee offered said addition of income for taxation and did not contest the same on merits. However, the Assessing Officer (AO) initiated penalty proceedings u/s 271AAB of the Act in respect of the aforesaid income offered for taxation on account of higher valuation of the stock of the assessee by the Departmental Valuer and levied the impugned penalty.

In appeal, the Ld. CIT(A), vide a detailed order, deleted the penalty levied by the Assessing Officer, holding that there was no discrepancy in the quantity of stock found during the course of the search and that the dispute pertained solely to the valuation of the stock by the departmental valuer. The Ld. CIT(A) has relied upon various judgments, including the judgment of the Coordinate Bench of this Tribunal in case of Padam Chand Pungliya Vs. Assistant Commissioner of Income Tax reported in [2020] 113 taxmann.com 446 [Jaipur-Tribunal], wherein the Tribunal has held that the amount representing the excess stock based on the valuation by the

After hearing the Ld. representatives of the parties, we do not find any reason to interfere with the well-reasoned order of the Ld. CIT(A). There is no merit in the appeal of the Revenue and same is accordingly dismissed. Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 26/05/2026.