9911796707
TMI Blog2013 (10) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment years – Decided against the Assessee. - ITA Nos.23-29/Coch/2012 - - - Dated:- 28-6-2013 - N R S Ganesan And B R Baskaran, JJ. For the Appellant : Shri M R Vijayaraghavan, CA For the Respondent : Shri M Anil Kumar, CIT(DR) ORDER:- PER : B R Baskaran These appeals, filed by the assessee, are directed against the common order dated 28-11-2011 passed by the Ld. CIT(A)-I, Kochi and they relate to the assessment years 2002-03 to 2008-09. Since the issues contested in these appeals are arising out of the common set of facts, they were heard together and are being disposed of by this common order for the sake of convenience. 2. In all these years, the assessee is aggrieved with the net profit determined by the Ld. CIT(A). 3. The facts relating to the case are stated in brief. The assessee is a manufacturer and dealer of bakery products like sweets, biscuits etc. He is the proprietor of two shops located in Panoor and Pookkam. He is also one of the partners of the two other shops located at Tellicherry. All the shops have common name, viz., M.R.A. Bakery . His wife Smt. Hairunnissa is the Proprietary of M/s M.R.A. Ayurvedic Products . The Department car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee in the returns of income filed u/s. 153A of the Act. 5. The gist of the additions made in each of the assessment year is tabulated by the Ld. CIT(A) as under: 1 2 3 4 5 6 7 AY Estimated Annual turnover by the AO GP rate % Estimated GP A Admitted GP in the Original Return B Admitted additional income in the revised returns in Rs. C Assessed undisclosed income in Rs. (A-(B+C)) 2008-09 2,67,30,000/- Net profit rate @27.8 as assessed in assessment year 2006- 07 74,52,324 NIL 5,54,500 @ 68,97,824 2007-08 2,43,00,000/- Net profit rate @27.8 as assessed in assessment year 2006- 07 67,55,400 NIL 13,11,850@ 54,43,550 2006-07 2,18,70,000/- 27.33 59,77,071 5,64,340 3,66,980@ 50,45,751 2005-06 1,96,83,000/- 20.8 39,53,000 4,22,310 4,97,645@ 31,73,202 2004-05 1,77,14,700/- 20 35,42,940 4,97,645 1,69,550@ 28,75,745 2003-04 1,59,48,230/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) held that it would be appropriate to estimate the net profit for each of the year, in the facts and circumstances of the in the instant case. 8. For determining the rate of net profit that should be adopted for determining the income of the assessee, the Ld. CIT(A) coonsidered (a) the net profit rate computed on the basis of income disclosed by the assessee in the returns of income filed by him u/s. 153A of the Act over the turnover determined by the Ld CIT(A). (b) the rate of net profit estimated by the Department in other comparable cases. In this regard, the ld CIT(A) considered the decision rendered in the related parties cases viz., Sri Abdul Gadhafi and Smt. Thasleena P.P. On conspectus of the matter, the Ld. CIT(A) determined the rate of net profit at 8% and accordingly, directed the Assessing Officer to determine the income by applying the said rate on the turnover determined by him. Still aggrieved, the assessee has filed these appeals before us. It appears that the revenue has accepted the orders passed by Ld CIT(A) and hence we are required to adjudicate the appeals filed by the assessee. 9. We have heard the rival contentions and carefully perused th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of account is reliable. However, the net profit declared by the appellant in the revised returns on the basis of cash flow statement was on much sound footings than an arbitrary estimation of income made by the Assessing Officer. If net profit declared by the appellant on the basis of cash flow statement with due credit for the omissions in assessment year 2006-07, the addition of Rs.24,888/- on undisclosed income from UAE Shop and Rs.6,31,200/- towards unexplained investments in UAE Shop, is considered with reference to the turnover estimated by the Assessing Officer and as modified and upheld in the proceedings, the net profit rate works out to 2.24% to 7.28% in assessment years 2006-07 and 07-08 as in the next page. A.Y. Admitted turnover in original books (Rs.) Admitted net profit in original books (Rs.) Admitted net rate in % Total turnover as upheld in this appeal proceedings (Rs.) MRA Bakery Panoor s revised income after depreciation (Rs.) Net profit rate Rs. E/D x 100 (Rs.) A B C D E F 2002-03 26,73,286 1,21,488 4.55 1,12, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is above 7%, the ratio laid in the case of Smt. Thasleena P.P. by the CIT(A) is not applicable to this case. In the case of Shri M. Mohammed based on his wife Smt. KP Zeenath s appeal proceedings the CIT(A)-I, Kochi decided that the average net profit rat at 9.54%. The cases quoted by the Assessing Officer in 4.2.6 are not applicable to this case. In the light of these facts and circumstances the Assessing Officer was not justified in applying the GP/NP rate based on a unreliable books. Thus, the appellant has made out a case that (i) the rate of gross profit adopted by the Assessing Officer is wrong, excessive and based on a unreliable and undependable books. Thus, the appellant has made out a case that (i) the rate of gross profit adopted by the O is wrong, excessive and based on a unreliable and undependable document or record or data, the assessment of gross profit on turnover as income is incorrect and only net profit from business has to be assessed as income and (ii) the rate of net profit assessed by the Assessing Officer is unreasonable and for higher than the rate of net profit raised by him in the cases of other assessees in the same group of persons and doing simil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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