TMI Blog2021 (8) TMI 458X X X X Extracts X X X X X X X X Extracts X X X X ..... computing the income of the assessee, but it cannot give the power to the AO to hold that the accounts are not correct or incomplete i.e. for the said reason only the AO cannot resort to reject the books of accounts of the assessee. FAA [Ld. CIT(A)] has ventured to do so (rejection of books of account) by assuming incorrect facts and misdirected himself by stating that the assessee has not produced the books of accounts before the AO/himself, whereas the AO has categorically observed that the assessee has produced cash books, ledgers and other documents called for by him. And in this context, it is noted that the Ld. CIT(A) has deleted the addition of ₹ 1.48 crores by relying on the veracity of the cash book submitted by the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anation and documents in respect of four issues raised inter alia has only drawn adverse inference against the assessee on one issue i.e. Sundry creditors. Thereafter made an addition on this issue of ₹ 1,48,19,758/-. 4. Aggrieved the assessee preferred an appeal before the Ld. CIT(A) who was pleased to delete the addition made by the AO. However, thereafter he proceeded to estimate the income of the assessee and directed the AO to estimate the net profit at 8% on the gross receipt [assessee has shown NP at 6.54%]. 5. Aggrieved the assessee is before us. 6. We have heard both the parties and perused the records. We note that the Ld. A.R of the assessee Shri Somnath Ghosh brought to our notice that the Ld. CIT(A) has made cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvation that he is not satisfied with the books of accounts maintained by the assessee and there was any shortcomings as per Section 145(1) or Section 145(2) of the Act. Thereafter, he brought to our notice the other contradiction/finding/conclusion wherein at Para 6 of last line of Ld. CIT(A) observes ......in the instant case, as stated above, it is a good ground for rejection of books of accounts. The Ld. A.R. wondered as to how the Ld. CIT(A) has come to such a conclusion when the AO has made a categorical observation at para 4.5 of the assessment order that the assessee had produced the cash book and ledger and other documents called for by him and did not find any fault other than that the assessee had not produced certain supportin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and bills to substantiate the purchase and payments made etc. so, according to her, these omissions on the part of assessee would vitiate the books of accounts. We do not agree with the contention of the Ld. Sr. D.R. on this issue for the reasons that if there is deficiency in vouchers or bills supporting the inference of the expense, this in our view cannot make accounts maintained by the assessee to be incorrect or incomplete. At the most, the expenses to the extent they are not supported by the vouchers can be regarded to be non-genuine and can be disallowed by the AO while computing the income of the assessee, but it cannot give the power to the AO to hold that the accounts are not correct or incomplete i.e. for the said reason only the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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