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2018 (12) TMI 123 - AT - Income TaxRejecting books of accounts - holding the purchases shown by the assessee as bogus - Held that:- Admittedly, assessee’s method of accounting has been accepted in preceding AY and in our opinion, unless there is contrary material available on record method consistently followed by assessee cannot be rejected without any basis. We therefore agree with observation of CIT (A) that accounts regularly maintained in course of business have to be taken as correct unless there are strong and sufficient reasons to indicate that they are unreliable. We therefore uphold the view of CIT(A) in accepting books of account of assessee. Insofar as addition regarding estimation of sales, job work income and other income, it is observed that Ld.A.O. has not given any reason for estimation. CIT(A) has recorded that even during remand proceedings A.O. has not made any enquiries and no comments have been given regarding books of accounts maintained by assessee. It is very much categorical to observe that sales has not been doubted by A.O. AO observed therein that, mere filing PAN numbers or assessment particulars, VAT returns and copy of sales tax RC etc., do not establish identity of persons. He further notes that actual and true identity of persons or company was business undertaken by them. PAN numbers/registration of VAT are allotted on basis of application, without actual defacto verification of identity or ascertaining actual nature of business activity, and therefore cannot be blindly accepted. On further perusal of the remand report it is observed that AO himself has not taken up any steps to verify these details. In our considered opinion moment assessee filed various details regarding sellers, onus shifts upon AO to verify the same at his end. Further it is observed that assessee has been having a progressive profit ratio from the preceding assessment years. - decided against revenue.
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