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TMI Blog2013 (6) TMI 358X X X X Extracts X X X X X X X X Extracts X X X X ..... easing gross profit ratio by CIT(A) - Held that:- Nothing wrong with the order of the CIT(A) though it was claimed that the assessee had loss in basmati paddy but in the details submitted before CIT(A) the assessee has himself shown gross profit @ 21.35% on trading of basmati. Further gross profit in the immediately preceding year was 7.76%. In case no books of account are produced and the AO is required to estimate the profit, he is duty bound to estimate such profits in a judicial fashion. No better yard stick can be available to the AO then the trading results of the assessee shown in the earlier years. AO has been more than reasonable to estimate the gross profit at 5% despite the fact that in the immediately preceding year the gross pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the request of the ld. counsel of the assessee. Thereafter the Bench did not function on 14.2.2013 and 4.4.2013. The cases were ultimately fixed for hearing for today i. 5.6.2013 and notice through RPAD was issued again but neither anybody appeared on behalf of the assessee nor any application for adjournment has been moved. In these circumstances, we were left with no option but to proceed the appeals on exparte basis. 4. After hearing the ld. DR for the revenue we find that assessment was completed u/s 144 because nobody appeared despite various notices. In fact last notice which the Notice Server tried to serve on the assessee on 29.12.2009 was refused by the assessee. During the assessment proceedings the Assessing Officer noticed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant material, we find that this issue has been adjudicated by the ld. CIT(A) vide paras 1.14 and 1.15 which are as under: "The issue is considered. The facts are that the AO noted that trading liability of Rs. 83,81,902/- in the name of M/s Singla Trading Co. Pehowa was ceased since the Prop. of the concern alongwith all the family members expired in March,2008 and as such nobody left to claim these liabilities. The appellant in the written submissions submitted that deemed income u/s 41(1) can be added to the income of an assessee in the year in which the liability actually ceased. The appellant further submitted that it is wrong to assume that there will be no legal heir of the said Sh. Amit Kumar. Once the police case is decided, many ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to have ceased. In this background we find nothing wrong in the order of the ld. CIT(A) and confirm the same. 8. Appeal of the Department is dismissed. ITA No. 1209/Chd/2011-Assessee's appeal 9 This appeal is late by two days since the appeal is of two days late and therefore, the same is condoned. 10 Following grounds have been raised by the assessee in this appeal: "1 The ld. CIT(A) has erred in law and facts of the case while upholding the addition of Rs. 25,74,652/- in the income of the assessee on account of gross profit by increasing gross profit ratio. 2 The ld. CIT(A) has erred in law and facts of the case while upholding the addition of Rs. 2,60,000/- on account of cessation of liability towards M/s Lachhi Ram Ramesh Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce basmati but the appellant declared GP @ 21.35% in the trading account of paddy basmati. It is worth to mention that the appellant has shown opening stock of paddy basmati at 2475 qtls which was valued at Rs. 23,87,221/-. The plea of the appellant is, therefore, not tenable/verifiable and hence is rejected. The AO estimated the income by applying GP at 5% as against the GP of 7.76% declared in the last year which is reasonable and hence addition on this account made by the AO is hereby confirmed. Ground no.1 of appeal is, therefore, rejected." 13 The ld. DR for the revenue was heard. 14 After considering the submissions of the ld. DR for the revenue and the relevant material, we find nothing wrong with the order of the ld. CIT(A) thou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e firm has given account statement to the Assessing Officer but no such statement was given to the assessee. It was submitted that the firm was at fault as it wrongly squared up account by showing cash receipt and the assessee had not paid any cash. 17 . The CIT(A) adjudicated the issue in para 1.16 and 1.17 of impugned order which read as under: "Another liability which was added by the AO u/s 41(1) of the Act is Rs. 2,60,000/- outstanding in the name of M/s Lachhi Ram Ramesh Chand, Pehowa. The AO noted that in response to summons u/s 131 of the Act, no balance stated to be outstanding in the books of the party in the account of the appellant. The appellant in the written submissions, however, submitted that the said firm refused to gi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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