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2021 (12) TMI 1035 - HC - Income TaxRejection of books of accounts - estimated net profit for the year under consideration at 7.6% of the total turnover - HELD THAT:- ITAT has observed that though there is no dispute regarding the fact that there are some technical mistakes in maintaining the books of accounts, however, AO should not loose sight of the gross profit rate shown by the assessee during the year under consideration as compared to the gross profit rate shown in the immediate proceeding year while coming to the conclusion of rejecting the books of accounts and estimating the net profit rate. ITAT has found that during the year under consideration, the gross profit rate shown by the assessee is 29.29% as compared to the gross profit fate of 27.87% shown in the immediately preceding year. ITAT is of the opinion that the gross profit rate shown during the very year is much better than the gross profit of preceding year and, in such circumstances, there is justification for complete decline of contract expenditure claimed by the asssessee, which goes to constitute the gross profit rate. ITAT has further taken into consideration the profit and loss accounts of the assessee for comparison of expenses and found that the same are in order. After finding the gross profit shown by the assessee as reasonable, the ITAT has found that the assessee’s claim of interest expenditure and depreciation is required to be allowed. In our opinion, the ITAT after thoroughly examining the material available on record has assessed the income of the assessee and according to us, the same is essentially a question of fact and appreciation of evidence. After going through the entire material available on record, the ITAT has come to the conclusion, which in our view is not liable to be interfered with. Learned counsel for the Revenue has failed to point out any perversity in the finding of fact recorded by the ITAT.
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