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Issues involved: Estimation of business income by applying a mark-up on expenses without proper basis.
Summary: The appeal was against the order passed by the ld. CIT(A) for the assessment year 2009-10. The assessee, a part of Anand group companies, provided professional services and business facilities to its group companies. The Assessing Officer (A.O.) observed a loss from the business due to high expenses compared to receipts. The A.O. estimated the business income at 20% of the expenses, adding Rs. 6,93,23,955 to the income. On appeal, the ld. CIT(A) confirmed this addition, leading to the assessee's appeal before the Appellate Tribunal. During the hearing, the assessee argued that the A.O. had estimated the income without a proper basis. The A.O. had not considered the receipts from group companies, which were genuine and as per mutual agreements. The Tribunal found that the A.O. had not provided any supporting material for the mark-up estimation. In the interest of justice, the Tribunal set aside the order and remanded the matter to the A.O. for a fresh examination, ensuring a reasonable opportunity for the assessee to be heard. The appeal was partly allowed for statistical purposes. In conclusion, the Tribunal found the estimation of business income without proper basis and remanded the matter for a fresh examination by the A.O. to consider all relevant aspects and provide a fair opportunity for the assessee to present their case.
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