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2015 (11) TMI 537 - AT - Income TaxRevision u/s 263 - Lower Gross and net profit shown by assessee - Held that:- Past history of the assessee shows that in none of the years books of accounts were rejected in absence of stock register. In AY 2007-08, the gross profit ratio of assessee was 11.51 % and in the current year it is 12.09% respectively therefore there is increase in the gross profit rate further the letter dated 19.07.2010 of the assessee also showed number of transformers repaired by the assessee. The letter also clearly explains the fall in the net profit ratio is because of payment of higher interest. The Ld. CIT has presumed net profit ratio of 8% on sales as well as 20% on job working without giving any comparable cases or any other reason. Therefore we do not find any reason to confirm AO has not made requisite inquiry on this aspect. Hence, we are of the view that Ld. CIT was not justified in making addition on account of gross profit. We do not find any error in the order of assessing officer on this count. Verification of sundry creditors on unsecured loan - Held that:- Assessee has furnished required details called for along with explanations in writing as well as all confirmations of the sundry creditors as well as lenders stating their name, address and PAN and also contra accounts along with the balance sheet and income tax returns of lenders. In case of TDS credit given to assessee AO has made inquiries from third parties. Further ld. CIT is under belief that sundry creditors and lenders remains unconfirmed which fact is not borne out from submission made by assessee and not controverted by revenue. Therefore order passed after such verification cannot be termed as erroneous. - Decided in favour of assessee.
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