TMI Blog2019 (7) TMI 642X X X X Extracts X X X X X X X X Extracts X X X X ..... ceding or subsequent AYs. If accounts of a particular AY are found not reflecting the true state of affairs, they would undoubtedly impact the accounts for the immediately preceding or subsequent AY. It is inconceivable that the accounts of one particular AY in isolation is rejected and not those of the immediately preceding or subsequent AY. While as explained in Honey Enterprises v. Commissioner of Income Tax [ 2015 (12) TMI 519 - DELHI HIGH COURT] the rule of consistency is not inflexible, and has to be applied given the facts and circumstances of a particular case, as far as the case on hand is concerned, for the reason explained hereinabove, its invocation by the ITAT in the impugned order cannot be faulted. In view of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 011 under Section 143 (3) at an income of ₹ 2,52,96,070/- resulting in an addition of ₹ 1,77,73,854/- on account of revised gross profit (GP). According to the AO, the Assessee had inflated the expenses and showed artificial excess consumption to the tune of 9.67%. According to the AO, the books of accounts did not present a true and fair picture of the Assessee s state of affairs. 5. The matter travelled to CIT (A) in appeal at the instance of the Assessee. The CIT (A) in the order dated 23rd October, 2012 noted that the Assessee has disclosed a Gross Profit (GP) margin of 13.81%. The Assessee was in the business of manufacturing various types of garments and a uniformity in GP across different kinds and styles of gar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a similar nature. Even in AY 2010-11 AO accepted the book result of accounts of the Assessee as submitted, under Section 143(3) of the Act. It was in these circumstances ITAT observed that instead of recasting the trading account per month the AO should have brought some independent and concrete material on record to reject book results in the AY in appeal. The ITAT also referred to the rule of consistency as explained by the Supreme Court in Radha Soami Satsang 193 ITR 321 and Rxcel Industries Ltd. 358 ITR 295. 8. Mr. Zoheb Hossain, learned Senior Standing counsel for the Revenue, assailed the impugned order essentially on the ground that there was no warrant for the observations that the AO had failed to bring out any sing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d undoubtedly impact the accounts for the immediately preceding or subsequent AY. In other words it is inconceivable that the accounts of one particular AY in isolation is rejected and not those of the immediately preceding or subsequent AY. While as explained in Honey Enterprises v. Commissioner of Income Tax (2016) 381 ITR 258 (Del) the rule of consistency is not inflexible, and has to be applied given the facts and circumstances of a particular case, as far as the case on hand is concerned, for the reason explained hereinabove, its invocation by the ITAT in the impugned order cannot be faulted. 10. Further, in view of the detailed findings given by the CIT(A) by examining the accounts afresh and holding that there was no jus ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
