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2021 (2) TMI 706 - AT - Income TaxEstimation of income - NP determination - non rejection of books of accounts - search u/sec. 132 was conducted in the business premises of the assessee as well as residential premises - Assessee objecting for estimation of income stating that assessee has agreed the addition due to pressure and on apprehension of levying the penalty - HELD THAT:- There was no material and no defects were pointed out by the AO. Even though search was conducted no evidence was found by the AO evidencing the suppression of income or the inflation of purchase or inflation of expenditure. The assessee has maintained regular books of account which are duly audited. A search u/sec. 132 was conducted but no evidence was found indicating concealment of income. The assessee relied on the decision of ITAT, Rajkot Bench in the case of ACIT Vs. RushabhVatika [2013 (11) TMI 211 - ITAT RAJKOT] wherein the coordinate bench has held that without rejection of books of account question of application of net profit does not arise. In the case of Pr.CIT Vs. Marg Ltd.[2017 (7) TMI 823 - MADRAS HIGH COURT] also held that profits of the assessee cannot be estimated without rejection of books of account. In the case of Dhakeswari Cotton Mills Ltd. Vs. CIT [1954 (10) TMI 12 - SUPREME COURT] held that AO is not entitled to make a pure guess work or suspicion without any reference or without any material at all. Taking into consideration of all the above aspects, in the instant case, there is no basis for estimation of income, therefore, estimation of income made without having any material is bad in law, thus, we uphold the order of the ld. CIT(A) and dismiss the appeal of the Revenue.
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