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TMI Blog2013 (12) TMI 1197X X X X Extracts X X X X X X X X Extracts X X X X ..... making trading addition of Rs. 2 crore on adhoc basis. ii) That the observation and finding of lower authorities are without proper appreciation of fact and based on surmises and conjectures and in total disregard to our detailed submissions before Assessing Officer and Ld. Commissioner of Income Tax (A). 2. That the orders of the lower authorities are not justified on facts and same are bad in law. 3. In this case the assessee is running Departmental Store at various places in Delhi in the name of "Big Apple". The Departmental Store was started in F.Y. 2006-07. The "Big Apple" is a retail chain of convenience stores, catering to daily house hold needs of various income group customers. The assessee has got 65 Stores in Delhi during F.Y. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses, advertisement and entertainment, selling and distribution etc. It is also seen that cash deficit found during the course of survey was claimed to be utilized for giving advance to farmers and to Sh. Munish Hemrajanai, MD in F.Y. 2006-07. However, there were no records in the books of accounts about such payment of cash in F.Y. 2006-07 and 2007-08. This clearly suggest that appellant's books do not reflects correct state of affairs and same cannot be relied upon specially in view of huge decline in the gross profit during the year. Hence, the books of accounts rejected by the Assessing Officer u/s 145(3) of the IT Act on the basis of defects pointed out above were justified and the resultant addition of Rs. 2 crore is based on such defe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder employees cost, rent and other services, traveling and conveyance, legal and professional charges, miscellaneous exp., selling and distribution exp. Etc. Reply These observations are without proper appreciation of facts. The Assessing Officer has given the comparative details at page 2 para 5 of the assessment order and as per these details, it is self evident that the cost has come down in respect of claim of rent and other services. In fact, the increase in rent and other services were on account of opening of new stores in respect of which details were given at page 54 to 57 of the paper book. Further, the entire claim is supported from audited accounts and Assessing Officer has not found any mistake or irregularity in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RP System. In this regard, he submitted his submissions as under:- "Enterprise resource planning (ERP) systems integrate internal and external management information across an entire organization, embracing finance/accounting, manufacturing, sales and service, customer relationship management, etc. ERP systems automate this activity with an integrated software application. The purpose of ERP is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders. Characteristics ERP (Enterprise Resource Planning) systems typically include the following characteristics: An integrated system that operates in real time (or next to real time), witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anagement of user privileges for various processes" 7.2 Ld. Departmental Representative on the other hand relied upon the order of the authorities below. She submitted that the books are having defects and hence were rightly reflected. Ld. Departmental Representative further relied upon the case of Ratan Lal Omprakash vs. C.I.T. 132 ITR 640 & S.N. Namasivayam Chettiar vs. C.I.T. 38 ITR 579. 7.3 We have carefully considered the submissions. We note that assessee has maintained proper books of accounts and the system of accounting and management under the ERP system. It has been duly submitted by the assessee that the observation that there is difference in value of opening and closing stock is not correct, the same is evident from the audi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oper stock record is maintained on ERP system. It is the assessee's contention that assessee has nowhere stated that no stock is maintained. The same is evident from the statement of Managing Director Sh. Munish Hemrajani. Furthermore, assessee has claimed that there was no case of any cash deficit and reconciliation statement was duly furnished to the Assessing Officer and Assessing Officer has not disputed the correctness of the same. Lastly, it is the assessee's contention that there is no case of any incriminating material either relating to trading activity or otherwise during the course of survey or assessment proceedings. 7.5 Thus, we find that assessee has cogently rebutted the shortcomings noted in the appellate order. In our cons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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