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2019 (1) TMI 889 - AT - Income TaxEstimation of income - rejecting the books of account and resorting to estimation of income - AO estimated the income at 5% of the cost of goods put to sale also confirmed by CIT-A - Held that:- We find that this issue is covered in favour of the assessee by various decisions of the Tribunal wherein we have upheld the estimation of income at 3% of the cost of goods put to sale. As relying on SRI VENKATESWARA WINES VERSUS THE INCOME TAX OFFICER, WARD 10 (4) , HYDERABAD. [2015 (11) TMI 1746 - ITAT HYDERABAD] AO is directed to estimate the net profit at 3% of the cost of goods put to sale. The assessee’s appeal is accordingly allowed. Seeking deduction of the remuneration and the interest paid to the partners from the interest which is estimated @ 3% of the cost of the goods put to sale - Held that:- In all the cases where we have estimated the income @ 3% of the cost of the goods put to sale; the contention of the respective assessee has been considered to hold that the net income of the assessee from business is 3% of the cost of the goods put to sale. Thus, the estimation itself takes care of the expenses such as remuneration and interest paid to the partners of the assessee-firm. Therefore, we find no reason to interfere with the order of the CIT (A) on this issue.
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