1. M/s. Vimla Stores a firm deals in agricultural implements, diesel, G. I. pipes, paints, spare parts and hardware, etc. It has three partners, namely, Sri Jagdish Narain and his two brothers. The firm Vimla Stores, hereinafter referred to as the assessee filed return for the assessment year 1996-97 on August 31, 1996, declaring an income of Rs. 11,193 and seeking refund of Rs. 37,054.

2. On December 13, 1995, the Assessing Officer, Sasaram along with six Income-tax Officers conducted a survey at the business premises of the assessee under the provisions of Section 133A of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). The stock found in the survey was as follows:

Rs.

Stock in shop premises 1,28,114

Stock in godown 11,14,687

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Total 12,42,801

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3 On the basis of sales tax return and cash memos it was found that for the period April 1, 1995, to December 13, 1995, sale of the value of Rs. 6,60,437 was effected. On the basis of purchase invoices it tra