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2017 (6) TMI 561 - AT - Income TaxN.P. estimation - rejection of books of accounts - Held that:- We are not in agreement with the arguments of the ld AR that the books of accounts were never rejected by the department in the year under appeal. We find that both the ld AO as well as ld CITA had brought on record several defects in the books and details produced by the assessee and had resorted to ignore the book results and resorted to estimate of profits in different ways. In the instant case, the only way for determining the total income of the assessee is by resorting to estimation of net profits. In these peculiar facts and circumstances, we hold that the net profits should be estimated as a percentage of total turnover taking into account all the defects in the books during pre-survey and post –survey period. We feel that the estimation of net profits (before partners remuneration) at 8% of total turnover would meet the ends of justice in the facts and circumstances of the instant case. The ld AO is directed the allow deduction of partners remuneration of ₹ 31.40 lacs from the net profit so determined above at 8% on total turnover of ₹ 1058.91 lacs. Accordingly the grounds raised by the assessee are partly allowed.
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