TMI Blog2023 (9) TMI 893X X X X Extracts X X X X X X X X Extracts X X X X ..... aw and the appeal is held to be without any merit. - HONOURABLE MR. JUSTICE BIREN VAISHNAV And HONOURABLE MR. JUSTICE BHARGAV D. KARIA MRS KALPANA K RAVAL(1046) FOR THE APPELLANT(S) NO. 1 ORDER ( PER : HONOURABLE MR. JUSTICE BIREN VAISHNAV ) 1 This Tax Appeal under section 260-A of the Income Tax Act, 1961, has been filed against the order dated 30.12.2022 of the Income Tax Appellate Tribunal in ITA No. 55/Ahd/2018 for Assessment Year 2012-13. 2 The following substantial question of law is raised in this appeal: (A) Whether on the facts and circumstances of the case and in law, the Appellate Tribunal has erred in upholding the decision of Ld.CIT(A) restricting the G.P@2% and confirming addition of Rs.1,6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessment Year 2012-13. Accordingly, the addition of Rs.5,38,26,869/- , being the difference between gross profit shown by the assessee and computed @4% of sales as per the trading results declared by the assessee. 3.3 Being aggrieved, the assessee filed an appeal before the Ld. CIT(A) and the Ld.CIT(A) considered the submissions of the assessee namely the rejection of books of account and estimation of gross profit @4%. After considering various details and records, CIT(A) estimated the gross profit as a reasonable one. Thus, out of the total addition of Rs.5,38,26,868/- made by the Assessing Officer, Ld.CIT(A) vide combined order for the Assessment Year 2012-13 2013-14 dated 05.12.2017, partly allowed the appeal of the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... But in the totally of circumstances the AO was not on a very sound footing in rejecting such books of account under Section 145(3) of the Act. 4.8 So far as estimation of gross profit at the rate 4% is concerned, AO has not given any comparable instances wherein similar firms have earned such profit. The AO has referred to profitability shown by four group concernes being Kedarnath Agri Tradelink Limited (one year), BB Trade Link Agro Pvt. Limited (2 years) Kedarnath Corporation (5 years) and Mahaveer Trading Company (5 years) and he found that BB Trade Link Agro Pvt Limited has shown GP @3.25% only in one year i.e. 2013-14. IL is observed that Kedarnath Corporation and Mahaveer Trading Company are showing profit in the range of 1% t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above order that Mr.Rajesh B. Agrawal, who has filed settlement petition for search carried out in his case along with the appellant, has offered income considering gross profit @ 2% before Hon ble Settlement Commission and same was accepted. Even the AO in the case of Rajesh B. Agrawal-HUF (Prop: Mahaveer Trading Company) for A.Y. 2014-15 has considered gross profit @2% as reasonable profit. Considering the order passed by the Hon ble Settlement Commission as well as subsequent order passed by the AO, it appears appropriate that reasonable gross profit for entire Group required to be estimated should be @2% for all the Assessment Years. It is observed that as the appellant has already shown gross profit @3.25% in Assessment Year 2013-14, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed by the Assessing Officer for the later assessment years. It is appropriate that a reasonable gross profit for entire Group required to be estimated for all the Assessment Years. The gross profit @2% as determined by the Ld.CIT(A) does not require any interference since he followed the same gross profit declared before Settlement Commission. Further the Ld. D.R. could not produce before us to enhance the estimation from 2% gross profit to 4% with necessary documents and evidences. In the absence of the same, we have no hesitation in confirming the order passed by the Ld. CIT(A). Thus the grounds raised by the Revenue are devoid of merits, hence the same are rejected. 4 Based on the estimated gross profit for the group and looking ..... X X X X Extracts X X X X X X X X Extracts X X X X
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