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TMI Blog2014 (1) TMI 905X X X X Extracts X X X X X X X X Extracts X X X X ..... e evidence showed the purchase of silver not idols or coins – the order of the CIT(A) under the head business promotion to the tune of Rs.69,875 – Decided partly in favour of Assessee. Deletion of addition made by estimating the GP @2.42% - Attempt made to lower the taxable income by inflating the expenses – Held that:- The AO rejected the books of account on the ground of lesser G.P. compare to his sister concern and discrepancy in office expenses and business promotion expenses - there was no defects found in the books of account and the appellant had maintained proper books of account including the bills and vouchers which were produced before the A.O. for verification - both the concerns deal with different cement companies having di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come by inflating the expenses. 2. Ground no.1 is against restricting the addition made by the A.O. on account of disallowance out of vehicle, office and sales promotional expenses of Rs.1,38,526/- to Rs.23,570/-. The A.O. observed that the assessee has debited personal expenses for own consumption to business expenses in office expenses and vehicle expenses. The A.O. gave the show cause notice, which was replied by the appellant. The assessee agreed to disallow 20% out of these expenses before the A.O. However, he was not satisfied with the explanation of the appellant. Therefore, he disallowed 33% out of office and vehicle expenses amounting to Rs.68,651/- and also Rs. 69,875/- from promotional expenses. 3. Being aggrieved by the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to confirm the order of the A.O. At the outset, ld. Counsel for the appellant filed written submission. It was submitted that all the expenses subject to disallowance are supported by various vouchers and assessee filed the ledger account of the expenses in the paper book. In regard to the sale promotion expenses, it is submitted that the assessee being main dealer of Ultratech Cement, has to give movements to valued customers as a matter of business practices. During the day of Diwali and new year, generally the assessee gifts silver coins alongwith idols of Laxmiji , Ganesha etc in the business circle. This year also the appellant had purchased silver coins from M/s. C. B. Brothers, who is bullion merchant, to distribute sale among the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anubhai Harilal Shah who had declared G.P. rate @ 2.42% in A.Y. 08-09 and 2.28% in A.Y. 07-08 who has been carrying on same business with same company from same business place. The assessee's reply vide letter dated 13.12.2010, which was not found convincing to the A.O. for detailed reasons given on page no.5 of the assessment order from sl. No. i to vi. After rejecting the book result u/s.145(3) of the IT Act. Ld. A.O. estimated G.P. @ 2.42% and addition of Rs.8,90,516/- was made in the income of the assessee. 7. Being aggrieved by the order of the A.O., the assessee carried the matter before the CIT(A). Ld. CIT(A) observed that the ld. A.O. rejected the books of account on the ground of lesser G.P. compare to his sister concern and disc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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