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2015 (1) TMI 508 - AT - Income TaxAddition on account of undisclosed income from job receipts out side books - estimating G.P. of 10% on net additional turnover - Held that:- Assessing Officer has accepted the expenses shown in regular books as correct and only taken receipt from the data found in the laptop. The Assessing Officer has given absolutely no reason as to why only receipt was taken from the laptop data and why expenses appearing in laptop data were not taken into consideration. It is not the case of the Revenue that the data found in the laptop shows that the actual net income of the assessee was more by ₹ 4,20,73,972/- from the income disclosed in the return of income. It is an established position of law that even when the undisclosed sale or receipt is found, then also only the income embedded in such undisclosed receipt can only be brought to tax. The entire sales could not be added as income of the assessee but addition could be made only to the extent of estimated profits embedded in sales. In the above circumstances, we do not find any force in the appeal of the Revenue and accordingly, the same is dismissed. - Decided against revenue. CIT(A) while estimating the gross profit at 10% has not given any basis for the same, though he has referred to the gross profit rate of the assessee at 5.22% in Assessment Year 2006-07 and 4.85% in the present assessment year. Thus the highest rate of gross profit shown by the assessee in Assessment Year 2006-07 and accepted by the Department is 5.22% and in our considered view, keeping in view the gross profit rate disclosed in respect of recorded receipt at 4.85% which is lower than now admitted gross profit rate of 5.22% to take care of this it will be just and fair to estimate the gross profit of the unrecorded receipt @ 6.50%. Therefore, modify the order of the CIT(A) to this extent and direct the Assessing Officer to accept the gross profit rate of the suppressed receipt of ₹ 4,20,73,972/- @ 6.50%. - Decided partly in favour of assessee.
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