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2012 (7) TMI 681 - AT - Income TaxAddition upon rejection of the assessee's books of accounts u/s. 145 - Held that:- In the present case no basis for the estimate as made by the two authorities below the CIT(A) merely reducing the addition as made by the AO by half. The assessee has disclosed a much higher gross profit than that for the earlier two years. No other comparable case has been again cited by the Revenue. The addition of income is not a concomitant of the rejection of books of accounts, as explained by the hon'ble high court in the case of CIT vs. Gotan Lime Khanij Udyog (2001 (7) TMI 19 - RAJASTHAN HIGH COURT ) and, as such, in our view no addition in the instant case is called for and thus decided accordingly. Addition u/s. 68 - Held that:- The assessee has stated per his written submissions of having rendered the affidavits complete before the ld. CIT(A), who, though, has ignored the same - the fact remains that the incompleteness of the affidavits are stated by the assessee to have been removed and as such, the same constitutes a valid material on record, i.e., something more than a bald assertion - restore the matter back to the file of the ld. CIT(A) for carrying out the required verification - The addition is consequently deleted. Disallowance u/s. 40A(3) - Held that:- AO only from its reporting per the auditor’s report in Form 3CD disallowed the claim whereas assessee though has rendered an explanation that the payment was made by depositing cash in the bank account of the supplier to secure the supply of goods pleading for business expediency as a reason for making the payment in cash - do not think that any disallowance u/s. 40A(3) in the instant case is sustainable in law as this is as the purchase under reference is on trading account, the result of which stands estimated by the Revenue after invoking the provision of sec. 145(3)- appeal of assessee allowed.
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