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2014 (2) TMI 687 - AT - Income TaxRejection of books of accounts Assessement of income u/s 144 of the Act Necessary details not provided Held that:- Estimation of income made by the CIT(A) at the rate of 5% of the net profit on total sales is concerned, an estimation is quite reasonable Relying upon C.Packirisamy vs. ACIT [2008 (12) TMI 190 - MADRAS HIGH COURT] - in case of Best judgment assessment, estimation of net profit at 5% of total sales is in accordance with the established principles thus, there was no infirmity in the order of the CIT(A). Set off of losses Held that:- The authorities have not given any finding as to why the earlier year losses should not be allowed to be set off against the income of the relevant assessment year and after set off if the net result is loss why not the same be allowed to be carried forward as per provisions of the Income Tax Act - If the income of the assessee for the year under consideration is assessed under section 144 of the act, that itself is no ground to disallow the setoff of earlier year losses, which the assessee otherwise entitled to claim as per law - the assessee is entitled to set off of loss of earlier years against the income directed by the CIT(A) to be estimated for the relevant assessment year - the assessee will be further entitled to carry forward if the resulting income will be negative Decided partly in favour of Assessee.
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