Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (1) TMI 132 - AT - Income TaxEstimation of income from IMFL business - 10% OR 5% - Held that:- The coordinate bench of the Tribunal in the case of Tangudu Jogisetty (2016 (7) TMI 379 - ITAT VISAKHAPATNAM) has considered the profit level in the line of business and decided that 5% of purchase price is reasonable profit margin in the line of IMFL business and directed the A.O. to re-compute the profit of the assessee. Thus we direct the A.O. to re-compute the income of the assessee at 5% of purchase price. Accordingly, this ground of appeal raised by the assessee is allowed. Unexplained credits in the capital account - As per the Trading account there was no opening stock, hence it appears that the impugned assessment year would be the first year of business. For IMFL business the year starts from 1st July and the assessee had introduced the cash on 02.07.2010. The AO has not discussed the issue in the assessment order and the assessee has not established before us that sum of ₹ 18 lakhs was generated out of business income. Therefore, we remit the matter back to the file of the AO to reexamine the issue whether the cash credit made in the books of accounts relating to ₹ 18 lakhs was business income or not and reconsider the issue afresh on merits. Unexplained gifts - Held that:- The assesseee is sister-in-law of Sri T.V.Ramana Murthy who is working as APSRTC driver, Gr.I for the last 10 years and as per the salary certificate, his gross salary is around ₹ 25,000/-. To support the business of his brother’s wife, Sri T.V.Ramana Murthy has stated to given a gift of ₹ 1.5 lakh. He has filed the confirmations and the source was explained as salary savings. Since the creditor is identified and having salary income of ₹ 25,000/- per month, we are of the view that there is no case for suspecting the gift and making the addition of ₹ 1,50,000/- relating to gift received from Shri T.V.Ramana Murthy. Accordingly addition made by the AO amounting to ₹ 1.5 Lakh out of the total addition of ₹ 20,68,500/- is deleted. With regard to the balance amount of ₹ 19,18,500/-, the assessee did not place any evidence to controvert the finding of the Ld.CIT(A). Therefore, we uphold the order of the CIT(A) and confirm the addition of ₹ 19,18,500/-. The appeal of the assessee on this ground is partly allowed.
|