2013 (4) TMI 907 - AT - Income Tax

Summary

Issues involved: Assessment of income u/s 143(3) - Estimation of profits u/s 145 - Appeal against CIT(A) order.

Assessment of income u/s 143(3): The assessee, engaged in retail trade in liquor, failed to produce books of account and supporting evidence during assessment proceedings, leading the Assessing Officer to estimate income at 9% of gross receipts. The CIT(A) directed the Assessing Officer to estimate net profit at 5% of purchases or stock put for sale, based on previous ITAT decisions. The Revenue appealed, arguing against this estimation method.

Estimation of profits u/s 145: The CIT(A) relied on the ITAT decision in the case of Amaravathi Wine Shop, directing the Assessing Officer to estimate net profit at 5% of purchases or stock put for sale, ensuring assessed income not less than returned income. The Revenue contended that this estimation method was not supported by material on record.

Appeal against CIT(A) order: The ITAT upheld the CIT(A) order, stating that the issue was covered by previous Tribunal decisions. The ITAT found no fault in the CIT(A)'s direction to estimate net profit at 5% of purchases or stock put for sale, ensuring assessed income not less than returned income. The Revenue's appeal was dismissed.