Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (6) TMI 160 - AT - Income TaxAssessment of suppressed sales - Gross profit or net profit - HELD THAT:- As relying on MAN MOHAN SADANI [2007 (10) TMI 246 - MADHYA PRADESH HIGH COURT], BALCHAND AJIT KUMAR. [2003 (4) TMI 76 - MADHYA PRADESH HIGH COURT] and SHRI HARIRAM BHAMBHANI [2015 (2) TMI 907 - BOMBAY HIGH COURT] we direct the AO to assess the income from undisclosed sales in question by applying the net profit rate in place of the “gross profit rate” as undisclosed sales. The net profit rate shall be that which the assessee had disclosed in its regular books of account for the said Assessment Year on recorded sales. In the result, this ground of the assessee is allowed in part. Disallowance u/s 40A(3) and Section 40(a)(ia) - whether addition can be made when profits have been estimated as a percentage of turnover, in the case of the assessee? - HELD THAT:- As decided in M/S PRADEEP SINGH WAZIR VERSUS COMMISSIONER OF INCOME TAX AND ANR. [2017 (3) TMI 1268 - SUPREME COURT] as income of the assessee on the total contract receipts had been reached at by applying the net rate of profit after reduction and, thus, no further addition could be made under Section 40(a)(ia) of the Act. Taxation of excess stock found by the revenue during the course of survey - survey done u/s 131 wherein the survey team found difference between the physical stock and the book stock - HELD THAT:- We find this issue to be no more res integra as co-ordinate bench of this tribunal in M/s Subarna Rice Mill vs. ITO [2015 (7) TMI 522 - ITAT KOLKATA] holding only the profit element liability to be added in such circumstances; stand upheld by hon'ble jurisdictional high court's recent judgment 2018 (8) TMI 1475 - CALCUTTA HIGH COURT] . We therefore conclude that the impugned former addition of the entire discrepancy in stock deserves to be deleted. Thus we direct the Assessing Officer to tax only the gross profit embedded in the excess stock found for the Assessment Year
|