TMI Blog2015 (1) TMI 359X X X X Extracts X X X X X X X X Extracts X X X X ..... checked the accounts of the transporters to verify the claim that cash payments for individual truck loads does not exceed ₹ 20,000/- per day - revenue has failed to controvert the factual finding of CIT (A) - assessee contended that because of fall in the gross profit on account of increased competition in the market - due to inability to make adequate profits from the business, the assessee has shut down the transport business w.e.f. 31.01.2010 – relying upon Vinod Kumar Pramod Kumar vs. ITO [1999 (12) TMI 117 - ITAT JODHPUR] wherein it has been held that minor variation in the gross profit declared in the year under consideration as compared to previous years by itself cannot justify any addition - CIT (A) has rightly deleted the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which is engaged in the manufacturing of cement. The assessee has also other source of income which includes income from petrol pump, income from partnership concerns, namely, Sharma Builders, Om Construction, etc. etc. Separate books of account are maintained for proprietorship concern, M/s. Sheevam Roadlines. The Assessing Officer made an addition to the income of the assessee of ₹ 30,08,983/- for the Assessment Year 2007-08 and ₹ 27,53,219/- for the Assessment Year 2008-09 on account of lower rate of gross profit declared by the assessee. 3. The grounds of appeal for Assessment Year 2007-08 read as under:- 1. On the facts and on the circumstances of the case, the Ld. CIT (A) has erred in deleting the addition of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. The assessee was engaged in providing the transportation services to M/s. Gujarat Ambuja Cements Ltd. for transporting the cement. The total transport charges received were at ₹ 37,88,30,533/- for the financial year 2006-07 relevant to Assessment Year 2007-08. The Assessing Officer also observed that the payments made to the truck owners were in cash and there were certain payments exceeding ₹ 20,000/- per day to one party. The Assessing Officer rejected the books of account by holding that assessee has not stated any specific reason for fall in the net profit ratio. Assessing Officer also observed that there are cash payments of more than ₹ 20,000/- to various parties; the assessee has shown meager profit from runn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not substantiated. The details of payments made were also filed before the Assessing Officer. The GR books were not containing the freight rates for the reason that the rates were decided by the company whose goods were transported as per the agreement. The CIT (A) admitted additional evidences and forwarded the same to the Assessing Officer for examination. These evidences were confirmations from the transporters. The CIT (A) also asked the Assessing Officer to comment on these confirmations and TDS certificates in the name of truck owners. The CIT (A) has also considered these confirmations and has also test checked the accounts of the transporters to verify the claim that cash payments for individual truck loads does not exceed ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the gross profit rate deserves to be deleted. It was also pleaded that rejection of books of account cannot be merely made on low gross profit rate or on any such irregularity. Considering all these aspects, we hold that the CIT (A) has rightly deleted the addition. 7.1 Facts of the case for Assessment Year 2008-09 were same, therefore, we also uphold the order of CIT (A) for deleting the addition for Assessment Year 2008-09. This addition was made on the basis of average gross profit rate for past 5 years. As we have held that due to non-profitability, the assessee had closed down the business on 30.01.2010 and for other reasons as set out by CIT (A), we uphold his order for this year also. In the result, the ground nos.1 2 in Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0.04.2007 Rs.23,00,000/- 21.05.2007 Rs.09,56,272/- The appellant also enclosed the copy of sale deed of the original asset, copy of application form for new residential house dated 24.01.2006, copies of receipts of payments and proof of possession dated 26.11.2009. In addition, during the appellate proceedings, the appellant has filed the flat buyer's agreement which shows a total consideration of ₹ 3,00,62,725/- for the under construction Apartment No. C-PH I at Pearls Gateway Towers, Noida. It is evident, therefore, that the appellant has made the entire payment for purchase of a new residential house between 24.01.2006 and 26.11.2009, on which date when the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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