TMI Blog2012 (10) TMI 486X X X X Extracts X X X X X X X X Extracts X X X X ..... eding year which was accepted by the Revenue. Thus even when the assessee’s accounts are to be rejected and income has to be computed to the best judgment of the AO, there would not be any justification for disallowance of even part of the labour expenses. Even in a best judgment assessment there would not be any justification for making any addition, especially when the percentage of net profi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The facts of the case are that the assessee derives income from manufacture of beads, necklaces and other hand made items. The same are being exported. For the year under consideration, the assessee incurred labour charges of Rs.18,65,000/-. During the course of assessment proceedings, the Assessing Officer asked the assessee to produce the labour charges register. The assessee did not produce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e s accounts and in estimating the income of the assessee under Section 145(3). However, even after the rejection of books of account, the reasonable claim of the assessee of the expenses has to be allowed. The comparative position of the year under appeal and the immediately preceding year is as under:- A.Y. Export Turnover Net Profit before tax(%) Labour Charges ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces, in our opinion, even when the assessee s accounts are to be rejected and income has to be computed to the best judgment of the Assessing Officer, there would not be any justification for disallowance of even part of the labour expenses. It would also not be out of place to mention here that on the export turnover of Rs.31.00 crores, the net profit disclosed by the assessee is Rs.15.10 crores ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
