| Question And Answer | |
|---|---|
| Subject: | Undisclosed sales Surrender at the time of GST Survey |
| Category: | GST, Income-Tax |
| Querist: | Nikita Mishra |
| Answered by: | Law Intern |
| Tags: | undisclosed sales |
| Date: | March 16, 2026 |
Survey was conducted under the GST.
Taxpayer has declared unrecorded sale during the survey proceedings and has paid GST as well as Penalty under the GST Act.
In addition to above, Taxpayer has also declared excess stock found during survey.
Regular purchases has already been recorded in books of accounts.
Whether the taxpayer should account for total undisclosed sales in Trading a/c and pay income tax accordingly or should account for only the gross profit on unrecorded sales in Profit and loss a/c.
If regular purchases have already been recorded in books of accounts and only sales are unrecorded, then only the profit element embedded in those sales (i.e., GP at the assessee’s normal/historical GP rate) is taxable.
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