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2019 (5) TMI 426

..... 5 (11) TMI 1746 - ITAT HYDERABAD] direct the AO to adopt 3% of the cost of goods of liquor sold as the income of the assessee. Accordingly, the grounds raised on this issue are allowed. Addition of interest from bank deposit - AO made this addition under the head income from other sources - AR has submitted that interest income earned are out of deposits, which are made only for the purpose of business - HELD THAT:- We remit this issue back to the AO to verify the interest income. If it is earned out of free deposits, the additional income may be sustained. Addition u/s 68 - petition for admission of the additional evidences - HELD THAT:- We admit the additional evidences (supra) submitted by the assessee, as the same are important ev .....

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..... u/s 68 of the Act. 3. When the assessee preferred an appeal before the CIT(A), the CIT(A) confirmed the order of AO. 4. Aggrieved by the order of CIT(A), the assessee is in appeal before us raising the following grounds of appeal: 1) The order of the learned Commissioner of Income-tax (Appeals) is erroneous both on facts and in law. 2) The learned Commissioner of Income-tax (Appeals) erred in confirming the action of the Assessing Officer in rejecting the books of account. 3) The learned Commissioner of Income-tax (Appeals) erred in estimating the income at 5% without properly appreciating the facts stated before him. 4) The learned Commissioner of Income-tax (Appeals) erred in confirming the addition made of ₹ 55,516/- separately re .....

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..... ard to the rival contentions and the material on record, we find that the AO has called for books of account of the assessee but the assessee had failed to produce the same. Therefore, AO had estimated the income of the' assessee at 2.5% of the turnover. The CIT wants the same to be estimated at 5% of the total turnover because the Tribunal in the case of an assessee carrying on the same business of sale of IMFL has estimated the income at 5% of the turnover. This, in our view, is not justified as held by the Coordinate Bench of this Tribunal. The uniform net profit cannot be adopted in each and every case of similar business. Estimation of net profit must be on the basis of facts involved in each and every case. Therefore, in our view, .....

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..... 7; 31,09,500/- was introduced by the assessee towards his contribution to meet the expenditure of license fee and bank guarantee fixed deposits which are required to be made to get the license. Thus an amount of ₹ 31,09, 500/- stands to be explained. During the course of hearing on 22.01.2016, the AR submitted that the initial investment in business was made from agriculture income of parents. However, no evidence was produced before the AO. 8.1 Further, the AO observed that during the course of hearing on 25.01,2016, the AR submitted that relatives of assessee, G. Ramreddy, G. Sanjeeva reddy, L.sudhakar reddy, L.Malla Reddy, L. Yadamma, G. Yadamma - all these persons have agriculture income and contributed to the business. Copies of .....

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..... re necessary evidences for deciding the matter, prayed to admit as additional evidence: S.No. Particulars Page Nos. at paper book 1 Confirmation letter along with returns of income, computation of total income and financial statements for the AY 2012-12 and AY 2011-12 22-32 2 Details of amounts received form close relatives 33 3 Confirmation letter dated 16/04/2016 of Smt. Gangidi Yadamma along with agreement of sale cum GPA, Pattadar passbooks 34-48 4 Confirmation letter dt. 16/03/2016 of Sri d. Madhusudhan Reddy 49 5 Confirmation letter dt. 16/04/2016 of Sri T. Ramesh Chary along with return of income for the AY 2013-14, computation of total income, Andhra Bank Passbook. 50-61 6 Confirmation letter dt. 16/04/2016 of Sri Gangidi Ram Reddy .....

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