M/S. ALLABAKSHA MEHABOOB MULLA,,SANGLI vs. INCOME-TAX OFFICER, WARD - 2(1),, SANGLI

आदेश / ORDER

PER R.S.SYAL, VP : This appeal by the assessee is directed against the order passed by the CIT (Appeals)-1, Kolhapur on 07-08-2018 in relation to the assessment year 2009-10. 2. The assessee has raised two issues in its grounds of appeal namely, addition of Rs.8,43,230/- on account of excess stock and addition of Rs.4,00,100/- on account of excess cash - found during the course of survey. The ld. AR did not press the addition of excess cash. The same is, therefore, dismissed as ‘not pressed’.

M/s. Allabaksha Mehaboob Mulla

M/s. Allabaksha Mehaboob Mulla Copies of such statements have been placed at page 51 onwards of the paper book. In answer to question no.2, the assessee submitted that it was engaged in the business of Kirana items.

Here it is relevant to mention that though the assessee was also in sugar business but the dispute centers around only the Kirana stock. In response to question no.5, the partner admitted that no stock book of Kirana items was maintained. In answer to question no.6, it was admitted that the books of account for the entire current year were not written. In the concluding statement, it was stated that stock was physically counted at Rs.10,53,062/-, whereas the inventory as per books of account was only Rs.2,09,832/-, leading to excess stock of Kirana items at Rs.8,43,230/-. The assessee admitted that he was not able to explain the difference and agreed to offer the additional income of Rs.8,43,230/- for the year under consideration, which was actually not offered. On 15-04-2009, i.e. after more than two months from the date of survey, the assessee wrote a retraction letter to the AO, a copy placed at page 64 of the paper book, to the effect that there were some mistakes in the stock calculation inasmuch as some purchase bills were not considered at the time of survey. Though the assessee mentioned about some purchase

M/s. Allabaksha Mehaboob Mulla bills not recorded, but no details of such bills were furnished. It was for the first time in the year 2011, that is, after around two years from the date of survey, that the assessee filed detail of such goods claimed to have been entered into survey stock for which the bills were not received up to the date of survey. It can be seen from such a detail that the assessee has made out a case that 23 purchase invoices dated between 5-1-2009 to 7-2-2009 worth Rs.8,92,048/- were not recorded in the books of account as these were received post-survey though the goods were included in the inventory as on the date of survey. The ld. AR, on requisition, failed to lead any evidence to the effect that the goods against such invoices were received before the date of survey but the invoices were not entered as these were received later on. Given the fact that the actual stock was counted at the time of survey, and the tentative Trading, Profit and loss account was drawn which indicated excess stock of Rs.8.46 lakh; the assessee admitted such excess stock without raising any issue at that time; later on issued a retraction letter after more than two months but still without furnishing any detail of the alleged late receipt of invoices; taking a contention after two years that 23 invoices were received later on and still failing to lead any M/s. Allabaksha Mehaboob Mulla evidence to demonstrate that such invoices were received after the date of survey but the goods were received before the date of survey, entire case made by the assessee for the relief gets demolished. The contention seeking relief is based solely on the premise that certain goods were received in stock but the corresponding invoices were received after the date of survey.

However, no evidence to corroborate such a version has been provided. It goes without saying that the onus to prove that the earlier admission at the time of survey was wrongly made, was on the assessee because it was he who was retracting. If this contention, not backed by any evidence, is removed from reckoning, there is nothing to justify the retraction. I am, therefore, satisfied that the authorities below were justified in making and sustaining the addition of excess stock of Rs.8,43,230/- found at the time of survey.