Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (10) TMI 1485 - ITAT HYDERABAD

2015 (10) TMI 1485 - ITAT HYDERABAD - TMI - Estimation of income - surrender of income to settle and to purchase peace with the department - Held that:- As seen from the orders, except admitting income at 5% on the liquor sales there was no other agreed addition as stated by the Ld. CIT(A) in the order. Even though assessee has contested the income on sale of liquor at 5%, we are of the opinion that this estimation is reasonable considering the facts of the case. However, the A.O. is directed to .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed to adopt income of ₹ 1,96,400 as against ₹ 3,92,800 added by him in the order.

Addition of ₹ 24 lakhs as income offered from Bar and Restaurant by the assessee's partner - Held that:- Except the statement given by the partner during the course of survey, there is no other evidence establishing that assessee could earn that much income from the business. During the survey no incriminating material was found nor any excess stock was found. Even though books of accou .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ess activities, various investments, turnovers etc., and after conclusion of statement, last question was asked in the 11 page of the statement asking the assessee whether he want to state any thing further. At that point of time, assessee's partner seems to have declared additional ₹ 24 lakhs in order to "settle" with the Income Tax Department.

In view of the scope and ambit of the materials collected during the course of survey, the action under section 133A would not have an .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of ₹ 24 lakhs solely on the basis of statement. In view of this, we have no hesitation in deleting the same. A.O. is directed to re-work out the incomes accordingly. - Decided in favour of assessee in part by way of remand. - ITA No.1744/Hyd/2014 - Dated:- 31-3-2015 - B. Ramakotaiah, AM And Saktijit Dey, JM,JJ. For the Petitioner : Mr T Chaitanya Kumar For the Respondent : Mr Rajat Mitra ORDER Per B Ramakotaiah, A.M. This appeal by assessee is against the order of Ld. CIT(A)-III, Hyderabad .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sales and also amount of ₹ 24 lakhs to "settle" and "to purchase peace with the department". The A.O. after rejecting the books of accounts in the assessment estimated the sale of empty bottles at ₹ 50,000 as against ₹ 32,945 shown by the assessee in P& L account. On food sales of ₹ 1,96,400 AO estimated profit at 20% and an amount of ₹ 3,92,800 was considered as profit from the food business. Out of the stock put to sale in liquor business o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

er dated NIL stated to have been filed before the ITO, Ward 8(3). 3. The Ld. CIT(A) in appeal, however rejected the appeal on the reason that appeal does not lie against an assessment relating to addition where the assessment in that regard was made on agreed basis. Ld. CIT(A) took note of various decisions on the issue and after analyzing, vide paras 4 and 5 came to the conclusion that appeal does not lie where assessment was made on agreed basis, applying ratio of decision of Allahabad High Co .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

dmitted amounts and submitted that net profit can be estimated on stock put to sale at 3%, based on the ITAT order in the case of Manjit Singh Bagga vs. ITO in ITA.No.371 and others dated 30.09.2010. Ld. Counsel further submitted that there is no need to reject the books of accounts and estimating the incomes. Since the order of Ld. CIT(A) is wrongly considered that the additions were agreed,as such Ld. Counsel submitted that issues can be decided on merits by the ITAT with reference to addition .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

in the survey and assessee's entire turnover during the year was only at ₹ 1 crore on which ₹ 24 lakhs income could not be earned outside books of accounts. 5. Learned D.R. while admitting that there is a mistake in estimation of 5% of the income on the liquor sales however, submitted that estimation of income was correctly done by the A.O. as the books of accounts are not reliable. He further submitted that assessee has voluntarily admitted higher income and therefore, was preve .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

is directed to correct the arithmetic error that occurred in the order. 7. Coming to the estimation of income on food items at 20%, we are of the opinion that A.O. has not given any comparable cases to arrive at the profit of 20% on food sales. He simply estimated at 20% without there being any basis. Considering the facts of the business and location of the appellant Bar and Restaurant in Hyderabad, we are of the opinion that income can be estimated at 10% of the food sales. Accordingly, assess .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Even though books of accounts were rejected that does not mean the declaration given by the partner in the course of survey has any relevance for the business activity of the assessee. There was no evidence brought on record by the Revenue either in the form of excess stock found during the survey or excess cash available with the assessee or any other incriminating material to establish that assessee is earning unaccounted incomes. As can be seen from the statement also after enquiring about a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version