TMI Blog2019 (1) TMI 1013X X X X Extracts X X X X X X X X Extracts X X X X ..... ained by adding back the amount of purchases and sales then the same cannot be considered as turnover because in my considered opinion only the amount of sale is turnover and not the amount of purchase. But in this regard, the guidelines issued by The Institute of Chartered Accountants of India (ICAI) should also be considered. CIT-A should decide this aspect first by way of a speaking and reasoned order as to what is the turnover of the assessee. If it is found that the turnover of the assessee is less than ₹ 1 Crore then on the turnover so determined, rate of 8% rates can be applied to compute the income of the assessee but if it is found that the turnover is more than ₹ 1 Crore, then section 44AD of IT Act cannot be applie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The Ld. CIT(A) has erred in confirming the addition of ₹ 16,33,269/- estimated by the AO based on the Guidance Note of ICAI without appreciating the fact the said Guidance Note was applicable in respect of cases where the accounts are auditable u/s. 44AB of the Act but in the case of Appellant the Accounts are not auditable since the Turnover was less than Rupees One Crore. Same as above 4. The Ld. CIT(A) has erred in holding that the Appellant's claim of set-off of loss requires to be disallowed since the Appellant neither claimed such loss in the statement of income nor by filing a revised return of income or revised computation without appreciating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... below. 6. Assessee's submissions:- The written submission is filled by the assessee on 31/08/2018 is extracted as under: 1. The Appellant submits the following Written Submissions in support of the Appeal filed against the Assessment Order dtd: 30-11-2017. 2. The Appellant has been rendering consultation services in Real Estate and construction Business and providing guidance in the field of formation of layouts and other connected real estate services. 3. The Appellant has filed e-return of income on 14-02-2017 for the A.Y 2015-16 declaring income of ₹ 8,84,390/- and a scrutiny Assessment dtd 30-11-2017 was completed determining the total income at ₹ 25,17,659/- as against declared income of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O. The Appellant has carried on the transactions on the Principles of Futures and Options. The Ld. AO has not appreciated the fact that the Appellant is entitled to the deduction of Unfavorable/Negative Turnover against the Favorable/Positive Turnover. However the Ld. AO for computation of income out of the Share transactions has held that the Appellant has carried on Intra-Day Share Transaction which was held as Business of the Appellant and therefore the Ld. AO has invoked the provision of section 44AD of the Act and estimated the income at the rate of 8 percent on a Turnover of ₹ 2,04,15,866A The Ld. AO on para 4.4 (iii) has stated that the Turnover of the Appellant is below One Crore Rupees. Whereas he has adopted the Turnov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the following statements:- i. Return of Income for the A. Y 2015-16 with P L Account, Balance Sheet and Statement of Income marked as Annexure - A. ii. A Copy of Statement of the Business Transactions relating to Options and Futures which resulted in loss of ₹ 1,34,84,016/- marked as Annexure - B. iii. A Copy of Statement of the Business Transactions relating to Options and Futures which resulted in income of ₹ 59,22,595/- marked as Annexure - C. iv. An abstract of both transactions of Loss and Income which ultimately resulted in Loss of ₹ 75,61,420/- marked as Annexure - D. v. A Copy of the Trading Account of Share Transactions relating to Futures and Options marked as Annexure - E. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turnover of ₹ 2,04,15,866/- is obtained by adding back the amount of purchases and sales then the same cannot be considered as turnover because in my considered opinion only the amount of sale is turnover and not the amount of purchase. But in this regard, the guidelines issued by The Institute of Chartered Accountants of India (ICAI) should also be considered. Hence he should decide this aspect first by way of a speaking and reasoned order as to what is the turnover of the assessee. If it is found that the turnover of the assessee is less than ₹ 1 Crore then on the turnover so determined, rate of 8% rates can be applied to compute the income of the assessee but if it is found that the turnover is more than ₹ 1 Crore, then ..... X X X X Extracts X X X X X X X X Extracts X X X X
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