- (1.) WE have heard Shri Shambhu Chopra, learned counsel appearing for the department. Shri R.S. Garg appears for the assessee.
(2.) BRIEF fact, giving rise to the reference, is set out as follows:- The respondent-assessee is a private limited company engaged in the manufacture and sale of black steel tubes and galvanized steel tubes. For the year under consideration, it had filed its return declaring a loss of Rs. 2, 67, 520/-. The assessment was completed by the Income-tax Officer, Central Circle-IV, Kanpur (A.O) vide order under Section 143 (3) read with Section 144-B of the I.T. Act dated 25.9.1984 on a total income of Rs. 10, 92, 020/-. The AO made a major addition of Rs. 10, 78, 886/- on account of difference in respect of three items of stock in the stock statements submitted to the Hindustan Commercial Bank, with whom such stocks were hypothecated for availing the overdraft facility, and the stocks as per books of account. The Assessing Officer took the 'peaks' of each of the item, as per details given below as the basis, for making the addition. Item Date on which Excess quantity (In Value (Rs.) difference is noted M.T.) 1. Zinc 17.11.80 45.200, 6, 14, 720 2 2. Galvanised 31.12.80 50.411, 3,03,066 Tubes 3. Black tubes 17.2.81 32.220, 1, 61, 100 The entire addition was deleted by the Commissioner of Income-tax (Appeals), Kanpur (C.I.T.(A)) vide order dated 14.3.85. On an appeal by the revenue, the Tribunal by its order dated 30.10.85 in I.T.A. No. 919 (Alld) of 1985, set aside the order of the C.I.T. (A) and remanded the issue. By an order dated 22.12.86 passed by the C.I.T. (A) in pursuance of the directions of the Tribunal, the entire addition of Rs. 10, 78, 886/- was found unsustainable and hence deleted.
(3.) IN appeal by the revenue, the Tribunal by its order dated 6.11.1990 in I.T.A. No. 447 (Alld) of 1987, held that this was a fit case where provisions of Section 69-B could be applied for sustaining the addition of Rs. 10, 78, 886/- arising out of the discrepancy of stocks declared to the bank vis-a-vis the stocks found in the books of account. The order of the C.I.T. (A) was reversed and the entire addition made by the A.O, upheld. On a Misc. Application moved by the assessee, the Tribunal by its order in MA. No. 67 (Alld) of 1991 dated 30.7.1993 recalled its earlier order dated 6.11.1990, for the limited purpose of finding out as to what was the quantum of the addition on account of excess stocks declared to the bank.;