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2017 (8) TMI 558 - AT - Income TaxRejection of books of accounts - suppression of sales - Held that:- The law is well settled, the Assessing Officer is within its power to reject books of accounts, if he finds that from the books so placed before him, true profit cannot be deduced. In the present case, the Assessing Officer in his wisdom finding that the facts are identical in the Assessment Year 2007-08. The assessee has not placed any material suggesting that there is change into facts and circumstances in this year. Therefore, he rejected the books of accounts, on the reasoning of the Assessment Year 2007-08. We do not see any reason to interfere in this finding of the Assessing Officer. However, we find merit into the contention of the assessee that the estimation should not be based merely on the guesswork, it should be based on the material gathered by the Assessing Officer during the Assessment proceedings. In the present case, the Ld. CIT(A) made an adhoc addition of ₹ 5 lacs on the ground for possible suppression of sale. In our view, this finding of the Ld. CIT(A) is not justified. He ought to given specific reasoning for sustaining such addition. In our view, addition cannot be made purely on the basis of conjecture. Therefore, this additional ground of the Cross Objection of the assessee is allowed
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