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2019 (7) TMI 756 - HC - Income TaxRejection of books of account - AO adopted G.P. Rate @15% instead of 14.52% as disclosed - enhanced the addition by estimating the G.P. @23.01%, after considering the past history - HELD THAT:- AO was right in invoking the provisions of Section 145(3) in rejecting the book result and estimating the gross profit. The assessee could not lead any evidence to the satisfaction of the AO to prove its genuineness. As regards the adoption of gross profit rate @23.01% the Tribunal has upheld the reasoning given by the CIT(A) wherein the CIT(A) has taken the average of the gross profit rate of the two preceding assessment years after considering the previous history of the assessee. On this issue, we find that the finding recorded by the Tribunal is a concluded finding of fact recorded on the basis of material and evidence on record and warrants no interference. The law as to what amounts to substantial question of law is also well settled. It has been emphasized that the finding of fact recorded by the AO or the first appellate authority or the Tribunal cannot be disturbed by the High Court in exercise of powers u/s 260-A unless such finding is perverse or is such which no person of reasonable prudence could arrive at in the given facts of the case. Undisputedly the powers of FAA in matters of assessment are co-extensive with the Assessing Authority, in so far as the CIT(A) had issued a notice and thereafter made the enhancement on the basis of relevant material, no question of law may arise against such estimation as it would remain a finding of fact. In so far as the enhancement made by the CIT (A) is based on cogent material and evidence, the said finding does not suffer from any error of Law. In M. Janardhana Rao Vs Joint CIT [2005 (1) TMI 14 - SUPREME COURT] held that in the exercise of the powers under Section 260-A of the Act, the findings of fact of the Tribunal cannot be disturbed.
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