sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
From the Courts »
 Deepak Sales & Properties Pvt. Ltd vs. ACIT (ITAT Mumbai) (Special Bench)
 Alok Textile Industries Ltd vs. DCIT (Bombay High Court)
 Dulraj U. Jain vs. ACIT (Bombay High Court)
 Halcrow Group Ltd vs. ADIT (ITAT Delhi)
  Kudrat Sandhu vs. UOI (Supreme Court)
 Commissioner Of Income Tax (Exemptions) vs Bharati Vidyapeeth Chairman
 Chief Revenue Controlling Officer Cum Inspector General Of Registration, & Ors. vs P. Babu
 Commissioner Of Income Tax (Tds) vs M/s Tata Teleservices Limited Managing Director
 Commissioner Of Income Tax (Tds) vs M/s Jai Prakash Associates Ltd.
 In The State Of Tamil Nadu vs Union Of India & Ors.
 Lakhan Lal & Anr. vs General Manager (R And R) Narmada Hydrorelectric Development Corporation & Ors.

The Income Tax Officer,Ward1(1),Kumbakonam. Vs. Manmull Inderchand(HUF),Prop.Sujatha Jewellery 33 TSR Big Street, Kumbakonam.
June, 14th 2012
                      `B' BENCH, CHENNAI


                            ITA No.787/Mds/2011
                          (Assessment Year: 2007-08)

The Income Tax Officer,                Vs.   Manmull Inderchand(HUF),
Ward1(1),                                    Prop.Sujatha Jewellery
Kumbakonam.                                  33 TSR Big Street,
    (Appellant)                                         (Respondent)

                    Appellant by   :   Mr. Vikramaditya, Sr. AR
                  Respondent by    :   None

                 Date of Hearing    : 7th June ,2012
         Date of Pronouncement      : 12th June, 2012



           The present appeal has been filed by the Revenue

    impugning order of CIT(A), Tiruchirapalli dated 3.2.2011.

    2.     The assessee is running jewellery business under the

    name and style of M/s. Sujatha Jewellery. The assessee filed

    return of income for the assessment year 2007-08 on

    27.03.2008 admitting total income of ` 1,78,470/-. The case of

    the assessee was selected for scrutiny              and notice under

    section 143(2) was issued to the assessee on 26.09.2008.

    The Assessing Officer vide order dated 16.12.2009 made
                                  2                   ITA No.787/Mds/11

addition on account of difference in valuation of closing stock

of gold and silver to the tune of ` 17,63,893/- and ` 2,45,784/-

respectively.     Apart from the above additions, the Assessing

Officer      made additions of ` 3,87,430/- on account of

unexplained credits in the books of accounts of the assessee,

and disallowed ` 42,654/-         on account of interest and `

92,352/- towards unaccounted sale of gold and silver.

3.      Aggrieved    against    the   assessment      order     dated

16.12.2009, the assessee preferred an appeal before the

CIT(A). The CIT(A) vide order dated 03.2.2011 partly allowed

the appeal of the assessee inter-alia deleting the following

additions made by the Assessing Officer:-

     i) Difference in valuation of closing stock of gold and silver

       ` 17,63,893/- and ` 2,45,784/- respectively;

      ii) Addition towards unexplained credits in        assessee's

        capital account;

     iii) Proportionate interest of ` 1,26,798/- under section 24

        considering the investment made in dwelling house out

        of the interest towards non-business purpose.
                                 3                   ITA No.787/Mds/11

     Aggrieved against the impugned order of the CIT(A), the

Revenue is in second appeal before the Tribunal assailing the

above findings of the CIT(A).

4.     Shri   Vikramaditya,     representing   the     Department

submitted that no stock register was produced by the

assessee before the Assessing Officer. He contended that

assessee did not respond to the notice issued under section

142(1) of the Act calling for evidence in support of the

calculation of closing stock declared by him.           He further

contended that the CIT(A) has erred in deleting the addition of

` 3,88,430/- towards unexplained credit by holding that mere

adjustments in the books of account will not constitute income

of the year unless it has not been assessed.            He further

submitted that the CIT(A) has not taken into consideration

the provisions of section 24 of the Act as the deduction can

be allowed only when the house was purchased or

constructed with the borrowed capital and during the period

when the house of the assessee was constructed, the

assessee did not borrow any sum for purchase/construction of

the house.
                               4                 ITA No.787/Mds/11

5.   None has appeared on behalf of the assessee.

6.   We have heard the submissions made by D.R. and

have gone through the orders passed by the lower authorities.

A perusal of the record shows that for valuation of stock, the

assessee has been following a particular method. The

Assessing Officer while valuating the closing stock relevant to

the assessment year 2007-08 has adopted FIFO method in

an arbitrary manner without justifying the reason for change in

valuation method.     Similarly, for other additions made, the

Assessing Officer has failed to give any cogent reasons for

making additions. Even the order of CIT(A) is sketchy and

non-speaking order.

7.    We, therefore,     in the interest of justice, deem it

appropriate to remand the matter back to the Assessing

Officer to decide the matter afresh by adopting method of

valuation of stock as adopted by the assessee in the earlier

years and thereafter calculate, difference if any, in the

valuation of closing stock as per the provisions of the Act and

also to decide other issues as per the provisions of law by

giving detailed reasons for making additions. Thus, we set
                                    5                    ITA No.787/Mds/11

aside the order of the CIT(A) and remand the matter back to

the Assessing Officer to decide the issues afresh within a

reasonable period of time after affording opportunity of

hearing to the assessee.

8.     The appeal of the Revenue is allowed in the above

terms for statistical purposes.

     Order pronounced in the open court on Tuesday, the 12th day of June,
     2012 at Chennai.

              Sd/-                                            Sd/-
 ( Dr. O.K.Narayanan )                             ( Vikas Awasthy )
    Vice President                                  Judicial Member
Dated the 12th June, 2012.


Copy to:      (1) Appellant     (2) Respondent     (3) CIT
               (4) CIT(A)        (5) D.R.          (6) G.F.
Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Privacy Policy

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions