P.M. Jagtap, A.M.—This appeal of the assessee is directed against the order of learned CIT(A), Jodhpur, dated 4-9-1995.

2. Ground No. 1(a) relates to the addition of Rs. 2,89,700 on account of unexplained investment in stock.

3. In this case the assessee deriving income from sale of various kinds of footwear, filed its return of income for assessment year 1992-93 on 28-7-1993, declaring an income of Rs. 1,04,437. The case was selected for scrutiny and during the assessment proceedings it was noticed by the Assessing Officer that the assessee-firm is enjoying cash credit facility of Rs. 2 lacs from Central Bank of India, Jalori Gate, Jodhpur, against hypothecation of actual stock, the details of which are required to be furnished by the assessee to the said bank periodically. In order to examine the correctness of the value of stock shown by the assessee in its books of account the Assessing Officer issued a notice under section 133(6) to the bank calling for information furnishing by the assessee to the bank regarding monthwise stock. In response to the said notice, copies of monthwise stock statements furnished by the assessee were produced by the bank before the Assessing Officer and from the perusal of the same, it was noticed by the Assessing Officer that the assessee has shown the closing stock of Rs. 2,36,450 in the books of account as on 31-3-1992, as against the closing stock of Rs. 5,17,170 declared to the bank revealing a difference of Rs. 2,80,720. The Assessing Officer also compared the figures of stock declared by the assessee to the bank for each month of the relevant year with the value of closing stock worked out as per the books of the assessee and noticed that there is varied difference in these figures in almost each month with the peak difference of Rs. 2,89,700 in the month of January 1992. He, therefore, confronted all his findings with facts and figures to the assessee and sought clarification/explanation as to why the peak difference of Rs. 2,89,700 in the value of closing stock appearing in the month of January 1992, should not be considered as unexplained investment of the assessee. In reply, the assessee stated that the figures of stock declared to the bank are not the real figures and, in fact, the statements furnished to the bank are prepared without taking the actual stock and more estimated figures are given in the said statement so as to be sufficient to utilise the maximum bank limit. The assessee-firm also frankly admitted that the figures of stock declared to the bank are fictitious figures and do not represent the real stock lying with the assessee at the relevant time. It was also submitted on behalf of the assessee before the Assessing Officer that whatever purchases have been made are all recorded in the books of account and there are no purchases outside the books. The plea of the assessee was not found tenable by the Assessing Officer and considering the figures given to the bank by the assessee as real and correct, he made an addition of Rs. 2,89,700 to the declared income of the assessee under section 69B on account of unexplained investment in the closing stock. The matter was carried before the learned CIT(A), before whom the submission made before the Assessing Officer was reiterated on behalf of the assessee and in support reliance was also placed on various case laws. The learned CIT(A) however brushed aside the contentions raised on behalf of the assessee before him, in view of the following observations of Hon'ble Supreme Court in the case of McDowell & Co. v. CTO [1985] 47 CTR (SC) 126/[1985] 154 ITR 148 (SC) which, according to him, were sufficient to demolish the cash made out by the assessee :

"The principle of Westminister has been given a decent burial even in the country of its birth and, in that very country where the phrase 'tax avoidance' originated the judicial attitude towards tax avoidance has changed and the smile, cynical or even affectionate though it might