TMI Blog2017 (10) TMI 1152X X X X Extracts X X X X X X X X Extracts X X X X ..... A.O. to re-compute the profit of the assessee. Thus we direct the A.O. to re-compute the income of the assessee at 5% of purchase price. Accordingly, this ground of appeal raised by the assessee is allowed. - ITA No. 34/VIZ/2016, ITA No. 149/VIZ/2016 - - - Dated:- 25-10-2017 - Shri V. Durga Rao, Hon ble Judicial Member And Shri D.S. Sunder Singh, Hon ble Accountant Member Assessee by : Shri G.V.N. Hari Advocate. Department By : Shri M.N. Murthy Naik Sr.DR ORDER Per V. Durga Rao, Judicial Member These cross appeals by the revenue and the assessee are directed against the order of Commissioner of Income Tax (Appeals)-2, Guntur, dated 17/11/2015 for the Assessment Year 2011-12. ITA No. 34/VIZ/2016 2. At the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2012 by order dated 22/07/2016 has observed as under:- 6. We have considered the issue. As far as the definition of tax is concerned, the tax does not include surcharge and cess as per the above referred cases. The coordinate bench in the case of DCIT Vs. Dome Bell Electronics (supra) has considered this issue vide para 3.2 of its order, which is as under:- 3.2 We have gone through the facts of this case and also gone through the aforesaid circular as well as sub-section (43) of section 2 of the Act which defines word tax . It is noted that Dome Bell Electronics the identical issue came up before the Hon'ble Chennai Bench wherein the Hon'ble Bench held as under:- We find that in clause (4) of Instruction No.5 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld include super-tax and also fringe benefit tax but not surcharge. Admittedly, here, the tax was only ₹ 2,90,250/- which is below the limit of ₹ 3 lakhs prescribed in the Circular for filing appeals before this Tribunal. Resultantly, we do not find any mistake in the order of this Tribunal much less any mistake apparent on record. We have also gone through sub-section (43) of section 2 which defines 'tax'. The perusal of the definition shows that whatever was intended to be included in tax has been mentioned therein. When the legislature has mentioned the words super-tax and fringe benefit tax', then, it could have also mentioned the words 'surcharge' and education cess' as well, if there was an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Act, 1961 (hereinafter called as 'the Act'). Later, after following the due procedure, assessment was completed u/s 143(3) of the Act by estimating net profit at 20% of the stock put to sale. 8. On appeal, Ld. CIT(A) granted a partial relief to the assessee by scaling down the percentage from 20% to 10% and directed the A.O. to re-compute the income at 10% of purchase price. 9. On being aggrieved, assessee carried matter in appeal before the Tribunal. At the time of hearing, the ld. Counsel for the assessee has submitted that the issue involved in this appeal is squarely covered by the decision of the coordinate bench of this Tribunal where the Tribunal has scaled down the estimation of profit from 10% to 5% in the case of T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s quite high when compared to the nature of business carried on by the assessee. It is further submitted that the case law relied upon by the assessee is not applicable to the facts of the present case. The case before the Hon ble A.P. High Court was that the assessee is into the business of trading in arrack, whereas it is in the business of dealing in IMFL. The assessee further contended that IMFL trade was controlled by the State Government through A.P. State Beverages Corporation Ltd. and the prices of the products are fixed by the State Government. The assessee being a license holder of State Government cannot sell the products over and above the MRP fixed by the State Government. We find force in the arguments of the assessee for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The coordinate bench in case of ITA No.127/Hyd/12 and others dated 18.05.2012 as well as a number of other cases have held that profit in case of business in Indian made foreign liquor has to be estimated at 5% of the purchases made by the assessee. Therefore, following the decision of the ITAT Hyderabad bench, we set aside the order of the CIT(A) and direct the assessing officer to estimate the profit from the wine business of the assessee by applying the rate of 5% of the purchases made net of all other deductions. The assessing officer should also bear in mind that in no case the income determined should be below the income returned. 9. Considering the facts and circumstances of this case and also respectfully following the ratio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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