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2019 (2) TMI 45 - AT - Income TaxPenalty proceedings u/s 271B - Rejection of books of accounts - G.P. rate - disallowance u/s 43B - Held that:- The entire case of the AO and the CIT(A) is that no audited account or audit report has been furnished. From the perusal of the letter filed before the AO, find that assessee has filed the audit report in response to a notice issued by the AO and said audit report is also appearing, wherein auditors have duly certified the books of account and the trading result in Form 3CB. Not only that, a notice was also sent by the AO to CA and despite all these material facts placed on record, the entire additions have been made on the ground that entries in the profit and loss account and balance sheet have not been audited. The entire basis and premise for making an adhoc addition gets vitiated in the light of the fact that audited accounts and the entire audit report was filed before the AO as well as before the CIT(A), which fact stands established by the Tribunal in the penalty proceedings u/s 271B. Apart from that, find that assessee has given the entire details relating to trading account and profit and loss account and balance sheet including details of opening stock, purchases and the sales made by the assessee before the CIT(A) which was also sent to the AO to submit his remand report. However, the AO in the remand report has not even commented upon these details. Once assessee has filed all the details and the audit report and has given explanation with regard to each and every entry of the trading account including expenses incurred with evidences, then no adhoc estimation of income or disallowance of expenses can be made. - Decided in favour of assessee.
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