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TMI Blog2014 (1) TMI 905X X X X Extracts X X X X X X X X Extracts X X X X ..... out of vehicle, office and sales promotional expenses of Rs.1,38,526/- to Rs.23,570/-, without appreciating the fact that the assessee failed prove that the sales promotional expenses were incurred solely for business purposes and the personal element in office and vehicle expenses is less than 33%. [2] On the facts and circumstances of the case and in law, the Id. CIT(A) has erred in deleting the addition of Rs.8,90,516/- made by the A.O. by estimating the G.P. @2.42%, without appreciating the fact that the assessee failed to give any justification for all in G.P. and had attempted to lower the taxable income by inflating the expenses. 2. Ground no.1 is against restricting the addition made by the A.O. on account of disallowance out of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 875/- is concerned, the contention of appellant that these expenses relate to business, seems convincing. It is a common practice among businessmen and to gift the items on the religious occasions to their customers and dealers. In the case of appellant also this expenditure was incurred for the purpose of distributing silver coins to his dealers on the occasion of Diwali, which was also incurred in preceding years. Therefore, he allowed the business promotion expenses fully and partly office expenses. 4. Now, the Revenue is before us. Ld. Sr. D.R. vehemently relied upon the order of the A.O. and requested to confirm the order of the A.O. At the outset, ld. Counsel for the appellant filed written submission. It was submitted that all the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pati Traders for Rs. 69,875/-. It is true that the appellant had paid this amount through account payee cheque which does prove that this expense is incurred wholly and exclusively for business purposes. The evidence showed the purchase of silver not idols or coins. Thus, we reverse the order of the CIT(A) under the head business promotion to the tune of Rs.69,875/-. Accordingly, Revenue's appeal on this ground is partly allowed. 6. Ground no. 2 is against deleting the addition of Rs.8,90,516/- made by the A.O. by estimating the G.P. @ 2.42%. The A.O. made comparison with another concern, namely, Mr. Kanubhai Harilal Shah who had declared G.P. rate @ 2.42% in A.Y. 08-09 and 2.28% in A.Y. 07-08 who has been carrying on same business with sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that appellant had debited the gas bill of residence in the p&l account which is not sufficient to reject the books result where turnover was Rs. 20 crore. Ld. A.O. had accepted the purchase, sale closing stock, opening stock, quantity detail and found which were 100% genuine and correct. No defects had been brought on record by the ld. A.O. to establish that the book results are bogus. The sister concern of appellant did not have 100% same nature of business. The appellant got commission @ 1.14% whereas sister concern received commission @ 1.55% on the turn over. Thus, he requested to confirm the order of the CIT(A). 9. We have heard the rival contentions and perused the material on record. The rejection of book result by the A.O. is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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