9911796707
TMI Blog2019 (1) TMI 1600X X X X Extracts X X X X X X X X Extracts X X X X ..... 43(3) of the Income Tax Act, 1961 (in short " the Act'') for the Assessment Years 2012-13 & 2013-14 respectively. 2. The issue involved in these appeals are identical, on similar set of facts. Hence all are heard analogously and are being disposed of by this common order. The ITA bearing No.2600/Ahd/2016 for Assessment Year 2012-13 is taken as the lead case. 3. The Revenue has come up against the deletion of addition of Rs. 1,79,12,777/- out of total addition of Rs. 1,84,38,444/- made on account of excess burning loss. The burning loss as shown by the assessee ranging from 7.64% to 10% is very high considering the assessee's line of business and consumption of electricity since valid from 74 units to 152 PMT as has been failed to be app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... burning loss and details of melting scraps could be finished. In the said show cause notice, the AO also relied upon the judgment passed by the Hon'ble High Court of Allahabad in the case of Mohan Steels where the burning loss at the rate of 2.5% as allowed by the AO was said to be justified. 5. In reply to the said show cause notice the assessee submitted as follows: a. ''...Various other entities have shown higher burning losses which have been accepted by the department. b. The order for AY 2010-11 by the C1T(A) has dealt this issue and is in assessee's favour. c. The AO cannot act on whims and conjectures/The reports cited by the AO cannot form the basis for addition. d. Judgments have been cited to this effect that b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correctness of the returns and accounts filed by the Assessee. Essentially the assessment would evidently mean determination of the quantum of taxable turnover and also the quantum of taxable amount payable by the tax payer. Under these circumstances, and detailed discussion made herein above and the adverse observations wherein substantial defects have been pointed out in the data made available by the assessee it would be fair to reach a conclusion that assessee 's books of account are not free from substantial defects and even though the same are not presented for verification it do not reflects the true state of affairs of the business run by the assessee. In view of the same, the trading account results of the assessee are hereby reje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he instant appeal the Ld.represestative of the Revenue made his submission on the basis of the order passed by the AO relying upon the judgment passed by the Hon'ble High Court of Allahabad in the case of Mohan Steels. 8. On the other hand Ld. counsel appearing for the assessee relied upon the written submission made before the Ld.CIT (A) which is part of the paper book before us. In addition to that he has also furnished the copy of the order passed by the Co-ordinate Bench in ITA No.3065/Ahd/2014/2014 with CO.No.309/Ahd/32014 for Assessment Year 2010-11 where the assessee was granted full relief. 9. We have heard the respective parties and perused the relevant material available on record. It appears that the business activities so ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord and impugned order. As we can see, assessee had supplied all the relevant details to the lower authorities such as register which are subject to regular check and subject to audit, Raw material Register, production register and audited books of account with tax audit report and there was specific defect was found by the Id. A.O. Therefore, in our considered opinion, Id. CIT(A) has rightly deleted the addition of Rs. 1,33,02,075/-. Therefore, we do not want to interfere in the order passed by the Id. CIT(A)...'' 9.4 We find that the Ld.CIT(A) in appeal though upheld the AO's view in not considering the order passed by his predecessor in respect of A.Y. 2010-11 in appeal in deleting the addition simply on the ratio of non-applicability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the GP ratio is on decline and the same has become negative in A.Y.2015-16, therefore, the latest profitable assessment year i.e. 2014-15 is taken as standard GP to compute the GP addition. If the standard GP at 4.65% is accepted then the GP addition for A.Y.2012-13 and A.Y.2013- 14 is computed at Rs. 5,25,667/- and Rs. 1,58,614/- respectively. Hence it is considered quite fair and reasonable to compute the GP addition for A.Y.2012-13 at Rs. 5,25,667/-. As all the expenditure has already been accounted while computing the basic GP percentage of 4.48, no further deduction for any expenses can be given. Consequently the addition of Rs. 1,79,12,777/- is hereby deleted and addition of Rs. 5,25,667/- is hereby confirmed. The ground No.2 is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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