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2019 (1) TMI 461 - AT - Income TaxAddition on the basis of lower gross profit margin - Held that:- What has been stated to be reason for Gross Profit addition is fall in the Gross Profit rate vis-a-vis previous year without any other specific reasons. The very approach so adopted by the Assessing Officer is devoid of legally sustainable basis. The business has been never so static so as to ensure same G.P. rate from year to year particularly when the assessee is dealing in such products as electric goods where Gross Profit margin not only varies from item to item but from season to season. The impugned addition thus not deserves to be sustained on merits. As regards the stand of the DR that the assessee himself has agreed to the impugned addition and thus prevented the Assessing Officer from further enquiries, no merit in this plea either. The mere fact that the assessee has agreed to the suggestion of the Assessing Officer cannot constitute estoppel against his rights to challenge the same on merits. In any case, the amount involved being small and in view of this discussion and bearing in mind entirety of the case, fit and proper to delete the impugned addition in respect of low Gross Profit margin. Disallowing various expenses - Held that:- It is sufficient to take note of the fact that the impugned disallowance has been made out of several expenses such as telephone expenses, vehicle expenses misc. expenses and office expenses. After some discussions, for the assessee fairly submitted that he does not wish to pursue this issue further but prayed that this fact should not be put against him in the penalty proceedings or in the subsequent proceedings.
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