TMI Blog2014 (1) TMI 1692X X X X Extracts X X X X X X X X Extracts X X X X ..... ice. We, therefore, considering that fact, are of the view that it would be fair and reasonable if the G.P. rate of 8% is applied for the year under consideration as against 8.11% directed to be applied by the ITAT for the earlier A.Ys. 2006-07 & 2007-08. Accordingly, we modify the order of the Ld. CIT(A) and direct the AO to work out the income of the assessee by applying the G.P. rate of 8% instead of 9% directed to be applied by the Ld. CIT(A). - Decided partly in favour of assessee. - ITA No. 881/JP/2011, ITA No. 838/JP/2011 - - - Dated:- 30-1-2014 - SHRI HARI OM MARATHA, JUDICIAL MEMBER And SHRI N.K. SAINI, ACCOUNTANT MEMBER. For the Appellant : Shri P.C. Parwal For the Respondent : Shri D.C. Sharma - D.R. ORDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd filed his return of income on 30/09/2008 declaring an income of ₹ 20,55,450/-. Later on, case was selected for scrutiny. During the course of assessment proceedings, the AO noticed that the assessee had made purchases of ₹ 1,09,70,605/- from 12 parties, which had been identified as Entry Operators as per the investigations made by the department. The AO also conducted an independent enquiry and asked the assessee to produce those parties, which he failed to do, the AO issued summons under section 131 of the I.T. Act, 1961 (hereinafter referred to as Act , in short), but those summons were returned unserved. Thereafter, an Inspector was deputed to serve the summons, who reported that the concerned parties did not exist at th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the earlier years as under:- Assessment Year Sales Gross Profit G.P. Rate 2006-07 10,82,65,564/- 87,77,546/- 8.11% 2007-08 8,99,95,783/- 68,64,340/- 7.63% 2008-09 7,27,78,920/- 52,25,973/- 7.18% 5. Ld. CIT(A) after considering the submissions of the assessee observed that the AO conducted independent enquiries, but the assessee in spite of repeated opportunities, was unable to rebut the evidence brought on record by the department regarding unverifiability of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he decline in turnover. This gives gross profit of ₹ 65,50,103/- but since the assessee has already shown g.p. of ₹ 52,25,973/-, trading addition of ₹ 13,24,130/- is confirmed during this year. Now both the parties are in appeal. 6. Learned counsel for the assessee reiterated the submissions made before the authorities below and also submitted that the issue is covered by the earlier decision dated 10/03/2011 of the ITAT, Jaipur Bench A , Jaipur in I.T.A.No. 1370 1371/JP/2010 for the A.Y. 2006-07 2007-08 respectively in assessee s own case. Copy of the said order was furnished. 7. In his rival submissions, Ld. D.R. strongly supported the order of the AO and reiterated the observations made in the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition is sustained at ₹ 3 lacs for A.Y. 2006-07 that will meet the ends of justice. 8. Regarding subsequent year, the facts are similar. The addition was made @ 25%. The ld. CIT (A) taking into consideration the past history directed the AO to apply g.p. rate at 8.11% against declared g.p. rate of 7.62% which was lower than the g.p. rate declared in the immediately preceding year. Therefore, the AO directed to apply g.p. rate at 8.11% on declared turnover of ₹ 899.96 lacs. The ld. CIT (A) has already made a fair addition by directing the AO to apply G.P. rate of 8.11% as against declared g.p.rate of 7.62%. Since we are taking a consistent view that where certain purchases remain unverifiable, then the addition can be made ..... X X X X Extracts X X X X X X X X Extracts X X X X
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