Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (7) TMI 444 - AT - Income TaxG.P. addition - addition on fall in the gross profit ratio - Held that:- The assessee is maintaining books of accounts which are audited. The assessee has duly met all the adverse reservations of the AO in remand report/appellate proceedings before learned CIT(A) as set out above. No cogent material has been brought on record to prove that the assessee has manipulated its accounts to suppress profits. Therefore, there are no reasons or justification in law to reject the explanation given by the assessee to support its contentions. Mere fall in the gross profit ratio , in the absence of any cogent reasons could not be a ground to hold that the proper income could not be deduced from the audited accounts maintained by the assessee and the book results ought to be rejected, and consequently gross profit margin rate of preceding years be applied to the sales of the instant assessment year under appeal. There is no averments that there is an deliberate attempt to inflate cost of material or other expenses on the part of the assessee or to suppress sale price of products sold by the assessee. The allegations of the AO were duly met by the assessee in remand report/appellate proceedings as set out above. The Revenue is not in appeal before the Tribunal with respect to the relief’s granted by the learned CIT(A). Our view is consistent with the decision of Hon’ble Delhi High Court in the case of CIT v. Smt Poonam Rani (2010 (5) TMI 57 - DELHI HIGH COURT ). In our considered view, the additions made by the learned AO as sustained/confirmed by the learned CIT(A) to the tune of ₹ 1,38,47,120/- is not sustainable in law and we order deletion of the same. - Decided in favour of assessee
|