TMI Blog2015 (8) TMI 459X X X X Extracts X X X X X X X X Extracts X X X X ..... o supplier who were from the same locality and had similar turn over. We find that in the earlier preceding year the assessee had shown GP of more than 9%. Thus, his approach is very logical. It is also a fact that the assessee had not produced the creditors and the cash book and the bank account details were not matching. Considering the non reliability of the books of account, expenses and purchases, we are of the opinion that the estimate the income of made by the AO and confirmed by the FAA was is reasonable and justifiable. With regard to the higher percentage of the GP, we are of the opinion that in the interest of justice it should be restricted to 6.5% in place of 7.37%. We find that the cases relied upon by the assessee are not app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cates. Considering the facts of the case and the medical papers, delay in filing appeal is condoned. During the course of hearing the AR of the assessee did not press ground of appeal no. 2. Therefore, same is dismissed as not pressed. Assessee, an individual, engaged in the business of supply of bamboo, filed his return of income on 27.01.2006, declaring total income of ₹ 6,04,554/-.Assessing officer(AO)finalised the assessment u/s. 143(3) of the Act, on 21.08.2008, determining the total income at Rs./-17,27,850/-. 2. First Ground of appeal pertains to addition made on account of low Gross profit. During the assessment proceedings AO found that that the assessee had debited an amount of ₹ 3,53,90,954/- in the books of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... copy of both sides of the cheques were collected from the Bank u/s. 133(6) which revealed that he had withdrawn cash from Bank with these self-cheques. It was clarified by the assessee that the cash withdrawal were made and cash payments were made to several parties with these fund on the same day. The AO found that the cash book did not have any record of these withdrawal/disbursement of cash. He held that the cash book was defective and not reliable as it did not reflect all the cash withdrawal from the bank and the disbursement of the cash. In view of the above, the AO was not satisfied about the correctness and completeness of the accounts of the assessee. The books of account are therefore rejected by him. The AO further observed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7; 43,02,523/- in the relevant financial year compared to preceding financial year, that the sales price fixed one time at tender was allotted for the whole year, that the assessee had purchased the bamboo on more credit which effected the higher cost to the purchase price, that the assessee was not entitled to get cash discount from the suppliers, that the cash withdrawals were made for payment to several parties by the purchase manager in the forest and directly debited to the purchase account, that the assessee followed mercantile system of accounting. After considering the submissions of the assessee and the assessment order, he held that that all the payments against purchases freight, labour charges etc. amounting to more than S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unserved with the postal remark not known, that assessee was unable to furnish specific address of the sundry creditors. In view of the above the identity and genuineness of the sundry creditors could not be proved by the assessee. As the sundry creditors are not genuine, therefore, the contention of the appellant that GP was low because of maximum credit purchase and low cash discount was without any basis, that in the assessment year 2005-06 the GP shown by the assessee was 9.52%, that the AO had made an analysis of GP shown by different suppliers of bamboo to HPC hailing from the same locality of the appellant and engaged in procurement of bamboo from the forest in the same period, that from the analyses he adopted the lowest rate of 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the expenses he had claimed. It is not the case that the AO had made GP addition without any basis. He had actually compared the GP of the bamboo supplier who were from the same locality and had similar turn over. We find that in the earlier preceding year the assessee had shown GP of more than 9%. Thus, his approach is very logical. It is also a fact that the assessee had not produced the creditors and the cash book and the bank account details were not matching. Considering the non reliability of the books of account, expenses and purchases, we are of the opinion that the estimate the income of made by the AO and confirmed by the FAA was is reasonable and justifiable. With regard to the higher percentage of the GP, we are of the opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X
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