TMI Blog2017 (11) TMI 1063X X X X Extracts X X X X X X X X Extracts X X X X ..... o produce any supporting evidence as well as proper books of accounts in support of the claim we are of the considered view that the proper and just estimation of the income. The impugned order is accordingly modified. Accordingly this ground of the Revenue is partly allowed. Disallowance expenditure in the liquor expenses - assessee failed to produce any supporting evidence as well as books of accounts - CIT(A) restricted the disallowance by estimating the net profit of the assessee at 4% in the liquor business - Held that:- This issue is identical as raised in the ground no. (i), therefore, having regard to the facts and circumstances of the case and our finding in respect of the ground no. (i). We think it proper and reasonable to estimate the income in the liquor business @ 5%. The impugned order of the ld CIT(A) is accordingly modified. This ground is Revenue is party allowed. Addition u/s 68 - unexplained cash deposit - Held that:- We find that when the Assessing Officer has made the addition on various heads and part of which was sustained by the CIT(A) amounting to many times more than this deposit made in the bank account then the assessee is entitled for the benefit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting any case law in support of his decision to apply net profit rate of 5% on transport receipts of the assessee. (ii) deleting the disallowance of ₹ 8,91,071/- out of total disallowance of ₹ 16,97,753/- made by the AO without giving any basis or citing any case law in support of his decision to apply net profit rate of 4% on liquor receipt of the assessee. (iii) deleting the addition of ₹ 1,09,01,000/- made by the AO u.s 68 of the IT Act on account of unexplained cash deposits in the bank account since no documentary evidence has been produced by the assessee either bore AO or even before Ld. CIT(A) to substantiate his explanation regarding nature and sources of cash deposit of ₹ 1,09,01,000/- in his bank account; (iv) deleting the addition of ₹ 14,00,000/- made by the AO u.s 68 of the IT Act on account of unexplained cash deposits in the bank account since no documentary evidence has been produced by the assessee either before AO or even before Ld. CIT(A) to substantiate his explanation regarding nature and sources of cash deposit of ₹ 14,00,000/- in his bank account; (v) deleting the addition of ₹ 2,10,580/- made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntended that disallowance made by the AO has resulted a net profit of ₹ 39,57,985/- in the transport business which is equal 12.70% net profit rate which is impermissible in this line of business and further the Assessing Officer has made disallowance without invoking provisions of u/s 145(3). The ld. CIT(A) estimated income from the transportation business at 5% and accordingly restricted the disallowance/ addition made by the AO of ₹ 10,01,460 as against ₹ 34,00,216/- made by the AO. Thus the ld. CIT(A) has deleted the addition/ disallowance to the tune of ₹ 23,98,756/-. Aggrieved by the order of the ld. CIT(A), the Revenue of this appeal. 3. Before us, the ld. DR has submitted that when the assesseee has not produced any books of account or any supporting documents then the claim of the assesseee is not acceptable. The Assessing Officer has clearly stated in the assessment order that the assessee has failed to produce books of accounts as well as bills, vouchers in support of the expenditure. Hence, disallowance made by the AO at 10% of the transportation expenses, 20% of conveyance petrol, telephone, Mobile depreciation and vehicle loan expenses due t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he transport business. The assessee has contended that the net profit declared by the assessee in the earlier years 2008-09 to 2010-11 which was accepted by the AO is 1.5% however, we not that all the earlier assessment years the return of income were processed u/s 143(1). There is no scrutiny assessment, therefore, the income declared by the assessee in the earlier assessment years cannot be taken as accepted net profit for the purpose of scrutiny assessment made by the AO in the year under consideration. The Assessing Officer has disallowed various expenses and some of the expenses were disallowed to the extent of 10% of total expenses and others were disallowed to the extent of 20% whereas some other expenses claimed on account of salary to the driver and other staff has been disallowed in toto. Though the assessee could not produced the supporting documents as well as books of accounts however, when the Assessing Officer has not invoked the provisions of section 145(3) then the decision relied upon by the assessee cannot applied in the case of the assessee. The AO was framed the order u/s 144 however, the Assessing Officer did not resort to the provisions of section 145(3). The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mounting to ₹ 1,09,01,000/-. The AO asked the assessee to show cause as to why this deposit should not be treated as unexplained cash credit. The AO observed that the assessee has failed to furnish any reply. Further except the submissions that cash are from receipt of wine, transport business and agriculture income, no supportive evidence or books of accounts were produced. Accordingly the AO made an addition of ₹ 1,09,01,000/-. The ld. CIT(A) accepted the explanation of the assessee that a sum of ₹ 34 lacs deposited in cash was shown with a description sale proceeds of food soyabeen. Further, the ld. CIT(A) has noted that the estimated cash turnover of the assessee was around to ₹ 8.22 crores and therefore, it can be reasonably presumed that the balance amount of ₹ 63 lacs were deposited out of agriculture produced sale, cash receipts from wine and transport business. Accordingly, the ld. CIT(A) directed the AO to delete the addition of ₹ 97 lacs. As regards the deposit of ₹ 12.01 lacs the ld. CIT(A) given the benefit of a telescopic as it had sustained the addition to the tune of ₹ 18,08,142/-. 8. Ground No. (iv) regarding disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of accounts from agriculture produce as well as receipts from the wine and transport business. He has relied upon the order of the Assessing Officer. 13. Having considered the rival submissions as well as relevant material on record we note that the assessee has declared agriculture income of ₹ 50,42,500/- from the agricultural land taken on lease. The Assessing Officer has accepted the said claim of agricultural income. Thus once the Assessing Officer has accepted the agricultural income of more than ₹ 50 lacs then accepting the claim by the ld. CIT(A) to the tune of ₹ 34 lacs in bank deposit which is specifically shown as sale proceed of food soyabin cannot be found fault with. Hence, to the extent of sources of deposit of ₹ 34 lacs we do not find any error or illegality in the order of the ld. CIT(A). As regards the balance amount of ₹ 63 lacs the ld. CIT(A) has deleted the said addition by considering the fact that the turnover of assessee from the transport and liquor business is ₹ 8.22 crores, therefore, the said amount of ₹ 63 lacs can be sourced from the receipt of wine and transport business. He further noted that the closing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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