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TMI Blog2012 (7) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... avits - Appeal of assessee allowed for statistical purposes. - ITA No.1792/Del/2011 - - - Dated:- 29-6-2012 - SHRI G.C.GUPTA, AND SHRI A.N.PAHUJA, JJ. Assessee by : Shri R.Mittal,AR. Revenue by : Smt.Surjani Mohanty,.DR. ORDER A.N.PAHUJA: This appeal filed on 13th April, 2011 by the assessee against an order dated 5th January, 2011 of the ld. CIT(A)-XXVIII, New Delhi, raises the following grounds:- 1. Whether the learned CIT(A) is justified to reject the books of accounts u/s 145(3) which were accepted by the Assessing Officer? 2. Whether the learned CIT(A) is justified in estimating the net profits of the assessee disregarding all the expenditure genuinely and bonafide claimed by the assessee when the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the service of a notice u/s 143(2) of the Income-tax Act, 1961 (hereinafter referred to as the Act ), issued on 19th September, 2008. During the course of assessment proceedings, the Assessing Officer ( AO" in short) noticed that the assessee debited an amount of Rs.1,42,084/- on account of expenditure on canteen. To a query by the AO, the assessee did not produce all the bills and vouchers in support of the expenditure. Since the expenditure book did not tally with the receipts from the visitors, the AO disallowed a sum of Rs. 69,213/-. Likewise, the AO disallowed an amount of Rs. 8,469/- out of miscellaneous expenses of Rs. 13,719/-, Rs. 91,293/- out of total expenditure on consumable goods at Rs. 4,32,575/- and `₹ 27,482/- o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the provisions of section 145(3) of the Act and concluded in the following terms:- 16. In view of the above facts, the provisions of section 145(3) are applicable. The books of account and bills etc. required under Rule 6F are not maintained. A large number of the expenses claimed are not backed by corresponding bills. Regarding professional receipts, the appellant has not produced any record such as bills and receipts. As discussed above, the appellant was asked to explain why provisions of section 145(3) be not invoked and net profit estimated however, he has only stated that these provisions are not applicable without rebutting the deficiencies discussed above. In view of these facts, the provisions of section 145(3) are applicable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant doctor in Sarthak Clinic. From A.Y. 2005-06 onwards, he took over the management of Bimal Hospital in addition to his consultancy in Sarthak Clinic. Since the nature of business of consultancy in a private clinic and the business of running a hospital are different with different rates of net profit, they are to be considered separately. In A.Y. 2003-04 and 2004-05 the appellant was only working as a doctor in his private clinic. The average net profit rate in these two years is 25.5%. Therefore, this is the rate to be adopted in regard to the receipts from consultancy in Sarthak clinic. In the copy of P L account filed by the appellant, these receipts are shown at Rs.32,27,702/-. At the rate of 25.5%, the net profit works out to Rs.8,2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oss total income thus amounts to Rs.14,62,566/- (14,07,417 + 55,149). After reducing the deduction u/s 80C and 80-D allowed by the A.O. amounting to Rs.1,07,815/-, the total income amounts to Rs.13,54,751/-. The total income computed by the A.O. is Rs.9,92,701/-. The income is thus enhanced by Rs.3,62,050/-. As discussed above, the appellant has been asked in the course of appellate proceedings on 24.12.10 why the provisions of section 145(3) be not invoked and net profit estimated at 20% of receipts. The reply filed by the appellant has duly been considered. Thus, necessary opportunity to the appellant has been given in terms of section 251(2) for showing cause against enhancement of income. 4. The assessee is now in appeal before us ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne, 2006-Rs. 2850/-, 26th February, 2007-Rs. 20,000/- and 31st March, 2007- Rs.20,000/- for hire charges of OT including cost of consumable items to Dr. Sandeep Kumar Gupta i.e. the assessee. Since the ld. DR did not place any material before us, controverting the averments in these affidavits and merely supported the findings of the ld. CIT(A) ,after discussion with both the representatives, we consider it appropriate to vacate the findings of the ld. CIT(A) on the issues raised in ground nos.1 to 4 in the appeal before us and restore these issues to his file for deciding the matter afresh in accordance with law, after verifying the genuineness of averments made in the aforesaid two affidavits and allowing sufficient opportunity to both th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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