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Commissioner of Income Tax Versus M/s. J. Ram And Sons, Nagar Utari, Garhwa

2015 (11) TMI 803 - JHARKHAND HIGH COURT

Unexplained investment - addition u/s 69 - CIT(A) deleted the addition - Held that:- he batteries were never purchased by the respondentassessee on one time payment, but, it was purchased on credit basis and hence, the amount which has been added in the income of the respondent-assessee which is ₹ 12,73,429/- as unexplained investment, could not have been added by the Assessing officer.

So far as, rate of net profit is concerned, Gross profit rate fixed by Assessing Officer @ 1 .....

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basis looking to the statement of accounts, average margin of profit is 3.5 to 4.5 and hence, 6 % net profit fixed for the year 1996-97 and for the Assessment Year 1997-98 is also absolutely reasonable. - Decided against revenue. - T.A. No. 36 of 2007 - Dated:- 28-9-2015 - D. N. Patel And Ratnaker Bhengra, JJ. For the Petitioner : Mr. Deepak Roshan, Adv For the Respondent : Mr. B. Poddar, Adv JUDGMENT Per D N Patel, J. 1. In this Tax Appeal the following questions of law have been involved: &qu .....

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ination of books of accounts to arrive at correct working of "peak credit" ? iii) Whether on the facts and in the circumstances of the case, the ITAT was justified in upholding the G.P. Of 6 % on undisclosed purchases whereas the assessee has himself shown a G.P. Of 15% in all the Assessment Years? iv) Whether on the facts and in the circumstances of the case the ITAT examined assessment records and return filed by the assessee to show that the assessing officer is not right in treatin .....

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investment u/s 69 of the Income Tax Act. Moreover, the Assessing Officer calculated 15% gross profit on the aforesaid amount. Against this order, respondent preferred an Appeal before the Commissioner (Appeals) and the Appellate Authority observed that the batteries were not purchased by giving cash amount, but, it was on a credit basis and percentage of profit was reduced to 6% for the assessment year 1997-98. Against this order of CIT (Appeal), an Appeal was preferred by this appellant before .....

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nal. 3. Having heard counsel for both sides and looking to the facts and circumstances of the case, it appears that the batteries were never purchased by the respondentassessee on one time payment, but, it was purchased on credit basis and hence, the amount which has been added in the income of the respondentassessee which is ₹ 12,73,429/- as unexplained investment, could not have been added by the Assessing officer. So far as, rate of net profit is concerned, Gross profit rate fixed by As .....

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the Income Tax Appellate Tribunal which reads as under: "6.We have considered the rival submissions of the parties and perused the materials available on record including the orders of authorities below and the papers filed in the paper book. The AO in this case has included the entire purchases made as unexplained investment u/s 69 and estimated the income from this business. It is undisputed that the AO has not given the basis on which the entire purchases were treated unexplained. On car .....

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