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2018 (1) TMI 593 - AT - Income TaxEstimating the income after rejecting the books of account - enhancement of the G.P. - Held that:- CIT(A) accepted the turnover declared by the assessee by holding that the Assessing Officer has failed to bring on record any adverse material to justify the quantification of undisclosed turnover. However, he reduced the G.P. estimation from 8.5% to 8% on the declared turnover. The facts on record shows that this estimate of G.P. @ 8% was not based on any specific defects noted by the Assessing Officer or by the ld. CIT(A) in the expenses claimed in the P&L account. Once CIT(A) has accepted the declared turnover of the assessee in absence of any specific defects and without specifying any defects in the books of account in estimating the G.P. @ 8% is also not justified. Keeping in view the various decisions relying upon by the ld AR, the Bench is of the view that the assessee was maintaining books of account, which were duly vouched. No specific defect has been pointed out by any of the authorities below. In absence of any contrary material on record to the declared gross profit on the declared turnover, the enhancement of the G.P. is unjustified. Therefore, the addition sustained by the ld. CIT(A) is deleted. Addition U/s 68 - Held that:- After considering the relevant documents submitted by the assessee, the Bench is of the view that the assessee was able to discharge the onus as casted upon by Section 68 of the Act for establishing the identity, creditworthiness and genuineness of transactions. It is also a fact that the assessee has received the amount by cheque from Shri Suresh Chand. Shri Suresh Chand has also explained the source of source from where the amount was received by him in his bank account on the maturity of FDR maintained with Dholpur Urban Cooperative Bank Ltd. against which he got banker’s cheque which was deposited in his account and the same was source of ₹ 10 lacs given by him to assessee. Considering all these facts and circumstances, the addition to the extent of ₹ 10.00 lacs is deleted. No pleadings were made for the balance addition U/s 68 of the Act of ₹ 27,500/-, therefore, addition to that extent is confirmed.
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