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Judgment
This is an application u/s 256(2) of the Income Tax Act, 1961, for the assessment year 1989-90 requiring us to ask the Income Tax Appellate Tribunal to refer the following questions for the opinion of this court :
"(i) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in sustaining the addition of Rs. 60,000 completed in the basis of the alleged difference found in the middle of accounting year ?
(ii) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in sustaining addition of Rs. 60,000 worked out on the basis of inventory of stocks prepared in the course of operation u/s 133A beyond the purview of powers in illegal manner ?
(iii) Whether, on the facts and in the circumstances of the case, there was any material before the Tribunal for sustaining the addition of Rs. 60,000 made on account of alleged sales outside account books in respect of purchases and stock recorded in the books?"
The facts, as briefly stated, are that a survey was conducted at the premises of Madan Lal Goverdhan Dass on November 6, 1987, of which Ram Das Gopal Das is a branch. At the time of survey, the survey party noticed a total stock of 3,112 pieces of footmats in the books of the assessee. As against that actual stock of 1,610 footmats was found on the spot. The assessee was called upon to explain the difference. The assessee filed an explanation stating that the difference of the total stock as entered in the books and the stock found on the spot at the time of survey, was lying in the branch office, namely, Ram Das Gopal Das, which dealt in different items. This is why the explanation of the assessee was rejected and an inference was drawn that the difference represented the sales outside the books.
The question for consideration is whether the aforesaid inference is contrary to law. In our opinion, when the explanation was not found acceptable by the assessing authority, reasonable inference could be drawn that the unexplained difference represented sales outside the books. Prima facie, we do not see any error in the approach of the authorities and hence, in our opinion, no statable question of law arises.
The application is, therefore, rejected.