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2012 (8) TMI 361 - ITAT, AHMEDABADRejection of the claim for acceptance of book result - addition on account of unexplained transactions - AO estimated GP @ 19.06% of the total turnover - Held that:- AO did not proceed to make addition by enhancing GP but proceeded to disallow the expenses and made addition in respect of unexplained transactions. Assessing Officer estimated the GP and took a view that an addition of Rs.16,25,424/- was required to be made. However, he did not make such addition in view of other disallowances made in the same order. Since, books of account, bills and vouchers etc., could not be produced because it is claimed that these are destroyed in flood, no disallowance can be made on the basis of non-existent books - Since the AO had determined GP rate at 19.06% of the total turnover and he took a view that an addition of Rs.16,25,424 - was required to be made. As per Section 144 AO should have determined total income at Rs.6,10,460/- + Rs.16,25,424/-. Thus, total income assessed u/s. 144 should be at Rs.22,35,884 - Since the AO has rejected the book results and estimated the GP, therefore, it would subserve the interest of justice if the addition is restricted to the extent of profit estimated by the AO - direct AO to restrict the addition to the extent of Rs.16,25,424 and delete all other disallowances - we hereby direct the AO to verify whether excess receipt has been offered to tax in next year, if so, the relief in accordance with law may be granted in favour of assessee - partly in favour of assessee.
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