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2013 (7) TMI 388 - HC - Income TaxGross profit rate - AO applied the rate @32.72 per cent - CIT(A) and ITAT applied 25% rate - Whether the Tribunal was justified in allowing the relief out of trading addition made by AO while approving the action of the CIT (Appeals) in rejecting the book result by relying on the decision of Howrah Trading Co. (P.) Ltd. v. CIT (1966 (2) TMI 17 - CALCUTTA High Court). - Held that:- this is the first year of the company and, hence, past results are not available and cannot be taken into consideration - The CIT(Appeals) has rightly distinguished the case on the strength of which the AO had applied the gross profit rate – On a reasonable estimate the CIT (Appeals) and the Tribunal have not committed any error in taking the figure of sales. Validity of order - orders as passed by the CIT (Appeals) and the Tribunal do not appear suffering from any perversity or from application of any wrong principle - the matter had been of putting a reasonable estimate on the quantum of sales and on the gross profit rate while recording the findings on facts - the authorities have recorded such findings with cogent reasons and on relevant considerations, court do not find any reason to interfere - The decision of Howrah Trading Co. P. Ltd. v. CIT relied upon by the AO is squarely applicable to the facts of the case - court approve the action of the CIT (Appeals) in rejecting the book results – the gross profit rate applied by CIT(Appeals) declared by the assessee is reasonable and does not warrant any further increase – decided against the revenue
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