TMI Blog2016 (3) TMI 184X X X X Extracts X X X X X X X X Extracts X X X X ..... the correctness of the accounts produced by the assessee. In the instant case the Assessing Officer has not rejected the books of accounts of the assessee. To put it differently the Assessing Officer has not made out a case that conditions laid down in Section 145(3) of the Act are satisfied for rejection of the books of accounts. Thus, when the books of accounts are maintained by the assessee in accordance with the system of accounting, in the regular course of his business, same would form the basis for computation of income. In the instant case it is noticed that neither the Assessing Officer nor CIT(Appeals) have rejected the books of accounts maintained by the assessee in the course of the business. As such tribunal has rightly reject ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l address of such creditors for verification of the balances a sum of ₹ 3,60,00,000/- was added to the total income of the assessee out of total sundry creditors. In the course of the assessment proceedings assessing officer noticed that the gross profit declared by the assessee for the earlier assessment years and the present assessment year were at variance and as such the gross profit was adopted at 4% of the total turnover. 3. Being aggrieved by this order assessee preferred an appeal before CIT(Appeals). The appellate authority during the course of proceedings called for remand report from the Assessing Officer and specifically directed the Assessing Officer to verify ledger extract and confirmations which were produced before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n sustaining the gross profit addition to an extent of ₹ 5,99,101/-. The appellate Tribunal after considering the rival contentions by order dated 30.01.2014 allowed the appeal of the assessee and deleted the addition of ₹ 5,99,101/- made by CIT(Appeals) on the issue of gross profit. On the issue of sundry creditors the tribunal held that in the remand report submitted by the Assessing Officer the sundry creditors had been bifurcated into three categories A, B and C and in respect of sundry creditors listed under A category there was no dispute since Assessing Officer himself had accepted the plea of the assessee of these creditors were genuine. Insofar as sundry creditors reflected under B and C categories the matter came to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact and there is no substantial questions of law involved in these appeals and he prays for rejection of the appeals. 8. Having heard learned advocates appearing for the parties and on perusal of the orders of the Assessing Officer, CIT(Appeals) and ITAT, we notice that on the issue of sundry creditors Assessing Officer had added to the total income of the assessee firm a sum of ₹ 3,60,00,000/- out of total sundry creditors of ₹ 10,37,33,867/-. The CIT(Appeals) held that the assessee had proved the identity of the persons and genuineness of the transactions by producing confirmation as well as ledger extracts in its books and evidence in the form of bank account extracts to demonstrate that payments were made through bank a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditors are concerned tribunal held that assessee had filed reconciliation of some of the accounts before the Assessing Officer did not result in Assessing Officer demanding any further evidence from the assessee to substantiate the reconciliation. As such tribunal held that assessee should be afforded an opportunity to explain the discrepancy with regard to 26 creditors out of 36 creditors. By reserving liberty to file any other supporting evidence to substantiate its case the issue came to be remanded by the tribunal to the Assessing Officer. 10. The facts as discussed hereinabove would clearly indicate that these are purely questions of fact and does not involve substantial question of law. 11. Insofar as the estimation of gross pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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