TMI Blog2017 (9) TMI 1747X X X X Extracts X X X X X X X X Extracts X X X X ..... ble. - decided against assessee - ITA.No.112/Hyd/2017 (A.Y. 2013-2014) - - - Dated:- 21-9-2017 - SHRI D. MANMOHAN, VICE PRESIDENT For Assessee: Shri K. Hanmandloo For Revenue : Shri L Ramji Rao, DR ORDER PER D. MANMOHAN, VP. This appeal arises out of the order passed by Ld. CIT(A)-5, Hyderabad and it pertains to A.Y. 2013-2014. Though several grounds were urged before the Tribunal, the limited issue is with regard to correctness of estimate of income arising out of sale of stock. 2. The assessee is a liquor dealer running wine shops in the name and style of M/s. Raja Rajeshwari Wines within Nirmal Mandal. It has come to the notice of Assessing Officer that assessee was in receipt of ₹ 3,32,94,655/- toward ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Profit around 12% with net profit of ₹ 6,95,936/-, which works out to 1.7%, which is below the norms in the line of liquor business. Under these circumstances, he rejected the book results and invoked the provisions of section 145 of the Act and estimated the net profit from sale of liquor at 5% of goods put to sale, clear of all expenses. A minor addition was also made with regard to Lodging business with which we are not concerned herein. 5. Aggrieved by the estimate of income at 5%, assessee contended before Ld. CIT(A) that as per the consistent view taken by the ITAT in several cases, income ought to have been estimated at 3% as against 5% estimated by A.O. It was also contended that the income declared by the assessee is reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted that an addition of ₹ 16,31,340/- was made by A.O. by estimating income from wines at 5% whereas in the assessee s own case for the subsequent year, A.O. accepted the return filed by the assessee wherein the assessee declared lesser profit i.e., 1.68%. For the A.Y. 2015-2016 the taxable income and the percentage of profit on turnover was only 1.91% and for both the AYs returns were processed u/s 143(1) of the Act. It was also submitted that under similar circumstances the ITAT had considered the taxable income of 3% of the stock put to sale and in this regard relied upon following decisions:- (i) ITA Nos. 1092 1093/Hyd/2016 in the case of Pandu Vadda Baojna and (ii) ITA No.94/Hyd/2017 in the case of Sri Mushkam Sudersha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Under these circumstances, I am of the view that the estimate of income at 5% is reasonable. 11. It deserves to be mentioned that the decision cited by Ld Counsel for the assessee does not contain any reason as to why the income is estimated on the lower side. In fact it is the duty of the Tribunal to verify as to what is the percentage adopted by the A.O. in the same area. It is the duty of the assessee to prove that specific constraints lead to earning less profit. In the absence of pointing out any such factors, I have no other alternative except to accept the estimate made by the Assessing Officer. 12. It is well settled that while estimating the income, in the absence of complete details, on account of rejection of books of acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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