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 529 - AT - Income TaxTrading addition - adopting the N.P. rate of 5% on an estimated sales - what should be the turnover of the assessee for the year under consideration? - HELD THAT:- The assessee has reported a turnover of ₹ 13,82,346 and the undisclosed balance with the debtors as on 31 March 2004 comes to ₹ 13,20,574 basis the diary found during the course of survey which has been owned up by the assessee. There is nothing on record to show that corresponding sales relating to the undisclosed balance with the debtors as on 31 March 2004 forms part of the reported turnover and thus, the same is clearly the undisclosed turnover of the assessee. Given that the Revenue is not in appeal, we are of the view that the ld CIT(A) is reasonable enough to determine the turnover of the assessee at ₹ 25,00,000. In the result, the ground of appeal is dismissed. Addition of capital employed in the business u/s 68 - assessee must be requiring the funds to run the business as he makes credit sales - sales are made on credit basis and funds would be required/tied up in sundry debtors and also for purchase of material - HELD THAT:- Such an addition cannot be sustained by invoking the provisions of section 68 which talks about any sum found during the books of accounts and in respect of which the assessee offers no explanation or the explanation so offered is not found satisfactory. In the instant case, there is no sum which is found credited in the books of accounts of the assessee and hence, on this ground itself, the assessee deserve the relief and the addition so made is hereby deleted. In view of the same, we have not dealt with other contentions so raised by the ld AR. In the result, the ground of appeal is allowed. Estimation of turnover - addition based on dairy found during the course of survey - HELD THAT:- AO basis the dairy found during the course of survey which has been owned up by the assessee has determined the undisclosed sales for the year amounting to ₹ 29,91,458 as against the reported turnover of ₹ 21,69,740 in the return of income. The matter relating to sales return are considered but not found established and hence, not acceptable. Therefore, the turnover is determined at ₹ 29,91,458 as against the figure of ₹ 35,00,000 sustained by the ld CIT(A). The assessee thus get’s the consequent relief on profit determination on the turnover of ₹ 29,91,458 and the ground is thus partly allowed.
|