9911796707
TMI Blog2018 (10) TMI 1033X X X X Extracts X X X X X X X X Extracts X X X X ..... posed of by way of this consolidated order. ITA No. 84/VIZ/2018 2. Facts of the case, in brief, are that the assessee is an individual and proprietor of M/s. Ganesh Timber Mart Depot, engaged in the business of retail trade of timber / furniture wood. In the assessment order, the Assessing Officer noted that during the course of search and seizure operations under section 132 of the Income Tax Act, 1961 (hereinafter referred to as 'Act') in the group cases of M/s. Sri Lakshmi Constructions on 17/12/2013, certain incriminating material of the assessee was found and seized. Consequently, after following due procedure, a notice under section 153C was issued to the assessee on 27/07/2015 calling return of income. In response thereto, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers. This way both purchases and sales are not recorded in the books, and after receiving the amount from the customers, the payments are made to the suppliers. The Assessing Officer after considering the detailed explanation of the assessee, he concluded that since the assessee has not recorded the sales made of Rs. 49,18,393/- during the Financial Year 2011-12, the entire amount of Rs. 49,18,393/- should be treated as credit sales and brought to tax for the Assessment Year 2012-13. Further, whatever amount claimed to have received through cheque for Rs. 25.00 lakhs, the assessee has shown, the amount was received on 05/04/2012. Further, the assessee is only a credit balance of Rs. 8,24,792/- in his account on 05/04/2012, after which he ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the department during the search and the transactions with M/s. Sri Lakshmi Constructions as well as Sri Mogga Eswara Rao for different assessment years were also noticed. In both the instances, the appellant had reflected the cheque payments in his books and not reflected the cash part of the sale. It can reasonably be presumed that the appellant would have made a claim for purchases of goods corresponding to the sales in its books. While doing so, he would not have bifurcated purchases to 50% while debiting to PL Account. In other words, the claim for purchases would have been made at 100% in P&L Account. Regarding the scaling up of gross profit at 34%, if entire sales are considered for tax, it is the chance taken by the appellant to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts of the appellant that the gross profit should be considered for tax is not permissible since the appellant has closed his books as on the date of filing of the return of income and debited purchases at 100%, but credited only the cheque, amount. I have perused the case laws filed by the appellant and noticed that the facts and circumstances of those cases are different as that of the instant case. It is pertinent to note that the appellant has categorically stated that the pattern of 50% is not adopted for all the cases except the two instances discussed supra. Thus, the Assessing Officer is directed to restrict the addition to an extent of Rs. 24,18,393/- instead of Rs. 49,18,393/- and to give credit to the cheque amount of Rs. 25,00,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that he has received Rs. 25.00 lakhs through cheque and the remaining balance of Rs. 24,18,393/-, not received by him. However, he acted that in the acknowledgment, signature appended by him only, it is also submitted before the Assessing Officer that certain purchases are made outside the books of account and whenever he receives payments, same is paid to the suppliers. Therefore, submitted that there are unaccounted purchases and simultaneously unaccounted sales also, only GP addition may be made. The Assessing Officer after considering the explanation of the assessee, he has not believed what has been stated by the assessee and added the entire amount in the hands of the assessee. On appeal, ld. CIT(A) has deleted the addition ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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