TMI Blog2020 (6) TMI 529X X X X Extracts X X X X X X X X Extracts X X X X ..... , we are of the view that assessee has declared 11.08% as GP without substantiating the result declared by it, the reasons best known to him. Assessee should be charged to tax @ 7% (considering the gross profit declared by the assessee in AY 2011-12 and 2012-13, where there is 6% increase in GP and we expect that assessee must have increased its GP by 10%.) Accordingly, we direct the AO to estimate the income @ 7%. Therefore, the ground raised by the assessee is partly allowed. - I.T.A. No. 402/Mum/2020 - - - Dated:- 6-3-2020 - Shri Pawan Singh, JM And Shri S. Rifaur Rahman, AM For the Appellant : Shri Himanshu Gandhi, AR For the Respondent : Mrs. Samatha Mullamudi, DR ORDER PER S. RIFAUR RAHMAN (ACCOUNTANT MEMBER): ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereas assessee has retained the same net profit and inserted the modified sales and purchases in the revised profit and loss account. As per the revised profit and loss account, the assessee has disclosed GP of only 4.15% of sales. On enquiry, assessee in his reply explained that he is receiving only commission ₹ 1 per liter (approx.) on sale of 1 liter of milk at ₹ 37. He submitted that the profit declared by the assesse is in consonance with the commission income earned by the assessee. As per the working submitted by the assessee based on the commission income, assessee declared the margin of 2.63% instead of 11.08% declared in the original return of income. Accordingly, AO rejected the contentions and submissions of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd registration certificate to carry on business of milk supply. He brought to our notice revised profit and loss account and prayed that the results of the revised profit and loss account should be accepted considering the commission income earned by the assessee on sale of milk and he also submitted the details of commission earned by the assessee during this year, which is reproduced below:- Company Product Distributor Rate Comm. Of Dist Rate for Retailer Comm. Of Retailer Customer Rate Warna Buffalo Milk 38.45 1.40 39.80 1.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this case. 9. Considered the rival submission and material placed on record, we notice from the record that assessee is a milk supplier and purchases milk from Swaraj India Industries Ltd, Shree Warna Sahakari Dudh Utpadak Prakiya Sangh Ltd, etc. and its main source of income only a commission income on sales of above milks. Assessee has submitted a detail chart on earning of commission from milk producers, which is ranging from ₹ 1.40 to 0.90 i.e. on an average earned 4.3%. We notice that assessee has declared GP 5.93% and 6.3% in earlier AYs 2011-12 and 2012-13 respectively. In the current assessment year, assessee due to some reason known to him declare ₹ 1.76 crores instead of ₹ 4.69 crores and also declared GP ..... X X X X Extracts X X X X X X X X Extracts X X X X
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