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2017 (12) TMI 1004 - AT - Income TaxRejection of books of accounts - addition of G.P. - Held that:- This is a fact that the assessee was not maintaining quality wise details of the commodities traded, therefore, it shall not be possible to verify the correctness of the valuation of the closing stock. Therefore, the Bench is of the view that the books of account were rightly rejected by invoking the provisions of Section 145(3) of the Act. Further the Assessing Officer made the addition of ₹ 4.00 lacs and the ld. CIT(A) restricted it to ₹ 3.00 lacs. After considering both the sides and various other aspects of the case including the increase in the sales turnover from 10.85 crores to 13.90 crores, the estimated addition of G.P. at ₹ 3.00 lacs is in higher side, therefore, the addition on this count restricted at ₹ 2.00 lacs. Disallowances out of shops expenses, telephone expenses, low household withdrawals and interest not charged respectively - Held that:- Since, the addition on account of gross profit has been sustained, therefore, no specific additions out of various expenses debited in the P&L account can be sustained. In view of the factual and legal position, the same are directed to be deleted.
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