TMI Blog2015 (6) TMI 1186X X X X Extracts X X X X X X X X Extracts X X X X ..... .T.A. No.1824/Mum/2011 - - - Dated:- 19-6-2015 - SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER For the Appellant : Shri Jeetendra Kumar, DR For the Respondent : Shri Rakesh Joshi ORDER PER G.S. PANNU, AM: This appeal by the Revenue is directed against the order passed by the CIT (A)-24, Mumbai dated 30.12.2010 for the Assessment Year 2007-2008 in the matter of order passed by the Assessing Officer u/s 143(3) r.w.s. 145(2) / 144 of the Income Tax Act 1961 (in short the Act‟), dated 14.2.2009. 2. In this appeal, the Revenue has raised the following Grounds of appeal:- 1. On the facts and in the circumstances of the case and in law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usted against the FBT demand for the Assessment Year 2007-2008 and the remaining refund amount of ₹ 6,17,760/- was issued to the assessee. Notices u/s 143(2) and 142(1) were also issued on assessee and the assessee has furnished the requisite details called for by the Assessing Officer. Accordingly, Assessing Officer completed the assessment u/s 143(3) r.w.s 145(2) / 144 of the Act and the assessed income was finally determined at ₹ 1,11,84,125/- after claiming the set-off of previous year‟s brought forward losses. In the assessment, Assessing Officer rejected the books of account u/s 145 (2) of the Act by estimating the Net Profit rate of the assessee @ 2.50% of the Freight Charges received during the year and passed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the orders of the Revenue authorities as well as the relevant material placed before us. On hearing both the parties and on perusal of the order of the CIT (A) in general and para 3.2 of the his order in particular, we find the same relevant in this regard. Considering the significance of the said para 3.2 of the CIT (A)‟s order for the sake of completeness of the issue under consideration, the same is extracted as under: 3.2. I have considered the submissions of the Ld Counsel and in this case, it is seen that the accounts of the assessee are audited u/s 44AB of the I.T. Act and report in Form No.3CD filed in which the Auditor has not qualified or made any major adverse remarks regarding the accounts and the books of accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .T. Act merely on certain assumptions and estimate the profit of the appellant when even the result and profit of the appellant are progressive as stated by the appellant as follows: AY 2004-2005 2005-2006 2006-2007 2007-2008 NP 21,22,883/- 41,42,430/- 50,99,832/- 54,79,771/- Turnover 44,33,54,354/- 54,28,90,339/- 64,01,84,299/- 66,81,47,381/- Thus, this ground of appeal is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ebtors and sundry creditors are subject to confirmation and reconciliation . Aggrieved, assessee is in appeal before the first appellate authority. 10. During the proceedings before the CIT (A), after considering the submissions of the assessee, he deleted the addition made on account of Net Profit @ 2.50%. CIT (A), on the issue of ad-hoc disallowance of ₹ 16,03,731/-, held that considering all the facts and circumstances of the case as well as the books of account of the assessee were duly audited u/s 44AB of the Act and in the absence of any adverse remark / note by the Auditor, the aforesaid disallowance was reduced to ₹ 3 Lakhs. Aggrieved with the aforesaid decision of the CIT (A), Revenue is in appeal before us. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c defects‟ could be pointed out by AO. Also, the results / profits‟ of the appellant are progressive and therefore in the absence of specific defects‟ the estimation of profit was not justified. Also, as stated by the appellant in details above and case laws cited and relied upon it is clear that on the given facts of this case both the books of accounts could not be rejected and consequently the GP could not be estimated. Accordingly, this ground of appeal is allowed and the GP addition made @ 2.5% is hereby deleted, and AO directed to assess the declared profits of the appellant. In the result, this ground of appeal is allowed. Further, while restricting the ad-hoc disallowance of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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