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2015 (6) TMI 362 - AT - Income TaxRejection of books of accounts - trading addition - Held that:- During the course of search, no incriminating documents were found and seized. The ld Assessing Officer rejected the book result for non-producing of the stock register but various courts has held that non-maintaining of stock register or not producing the stock register before the Assessing Officer is not sufficient ground to reject the Book result U/s 145(3) of the Act. Further, the assessee company is in manufacturing of medicine where Drug Control Act also applicable. According to that Act also, he has to maintain various records in compliance of that Act. It is a fact that no adverse comment had been given by the Assessing Officer on account of any discrepancy in manufacturing of medicines on the basis of search material or any other inquiry made by him. Therefore, the lower authority is not justifying in receiving books U/s 145(3) of the Act. - Decided in favour of assessee. G.P. addition by applying 60% rate of total turnover - assessee has shown G.P. @ 44.79%, - CIT(A) has applied G.P. rate @ 48% and reduced the total addition to the tune of ₹ 4,99,081/- by rectifying the order U/s 154 r.w.s. 250 - Held that:- The finding based on past history and not submitting the stock register before the Assessing Officer but no solid reasons have been assigned by the ld CIT(A). Both the lower authorities have not pointed out any defect in the books of account. The books of account has been audited under the Income Tax as well as Companies Law. The case law relied by the ld AR in the case of Malani Ramjivan Jagannath Vs. ACIT (2006 (10) TMI 145 - RAJASTHAN HIGH COURT) is squarely applicable. As per Income Tax law, in Section 2 (12A) books of account includes ledgers, day-books, cash books, account-books and other books, whether kept in the written form or as print-outs of data stored in a floppy, disc, tape or any other form of electro-magnetic data storage device. The Hon'ble Delhi High court in the case of CIT Vs. Jack Elegance Exports (2010 (4) TMI 84 - DELHI HIGH COURT ) has held that no provision either in the Act or in the Rules requiring an assessee carrying business of nature, to maintain the stock register as a part of its account has been brought to notice. The other case laws referred by the assessee on rejection of book and maintenance of stock register are also squarely applicable. Thus, we hold that the addition confirmed by the ld. CIT(A) is not justified. - Decided in favour of assessee.
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