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2019 (8) TMI 467

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..... he other purchasers by pointing out that the price quoted to the sister concern was minus sales tax component since the product was meant for export. The entire issue is based on appreciation of evidence on record. No question of law arises. The Appeal is dismissed. - INCOME TAX APPEAL NO. 615 OF 2017 - Dated:- 5-8-2019 - AKIL KURESHI & S.J. KATHAWALLA, JJ. Mr. Akhileshwar Sharma for the Appellant Mr. Tanmay Phadke i/by Mr. Satendra Kumar Pandey for the Respondent P.C.: 1. This appeal is filed by the Revenue to challenge the judgment of the Income Tax Appellate Tribunal, Mumbai ("the Tribunal" for short) dated 22.6.2016. 2. Following question is presented for our consideration:- "Whether on the facts and in the circumstan .....

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..... tions were made to the income of the assessee by applying the gross profit margin of 31.82% to the sales of the previous year relevant to the assessment year under appeal , based on gross profit margin earned during the preceding year. The assessee contended that in respect of some items, the sale price to outside parties is inclusive of accessories being supplied along with the manufactured products as well is inclusive of installation and commissioning whereas in the case of sister concern, the installation and commissioning was carried on by the sister concern itself. The AO rejected the contentions during assessment proceedings as the same were not based upon documentary evidences, while the assessee had duly submitted all the details b .....

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..... of ₹ 99 lacs on sales of ₹ 19.01 crores during the previous year relevant to the impugned assessment year, while in the immediately preceding assessment year the sales commission was only ₹ 1.08 lacs on sales of ₹ 20.58 crores. A separate addition was made by the AO of ₹ 99 lacs in the assessment order for the impugned assessment year under appeal. The learned CIT(A) deleted the said addition after calling remand report from the AO whereby the AO accepted that the commissions expenses were duly verified. It is not brought on record by the Revenue that the second appeal has been filed with the Tribunal by the Revenue challenging the relief granted by the learned CIT(A) in his appellate orders. In our considered .....

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..... al with respect to the relief s granted by the learned CIT(A). Our view is consistent with the decision of Hon ble Delhi High Court in the case of CIT v. Smt Poonam Rani (2010) 326 ITR 223 (Del.HC). In our considered view, the additions made by the learned AO as sustained/confirmed by the learned CIT(A) to the tune of ₹ 1,38,47,120/- is not sustainable in law and we order deletion of the same. We order accordingly." It can, thus, be seen that the Tribunal after detail consideration came to the conclusion that the assessee's books were not rejected. Merely because, in the present year, the assessee had reflected lower margin, would not be a ground for making additions. Most significantly, the assessee had explained the reason .....

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