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TMI Blog2014 (3) TMI 771X X X X Extracts X X X X X X X X Extracts X X X X ..... ities to find out whether the transaction was made in exchange of Saudi Rials and if so what is the amount of Saudi Rials handed over to the assessee - In the absence of any material, the matter needs to be reexamined by the assessing officer – thus, the order set aside and the matter is remitted back to the AO for fresh adjudication. Estimation of profit – Held that:- Estimation of profit at 1% is very reasonable - It is normal that in foreign currency exchange commission is charged at 3% to 4% by similarly placed traders as found by the assessing officer - the assessing officer has estimated the net profit at 1% very reasonably, therefore, the same is confirmed – Decided against Assessee. Claim of loss – Held that:- The assessee cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing any opportunity to cross examine the abovesaid Shri S Sabeer and Smt. N Radhabai. According to the ld.represntative, Smt. N Radhabai appears to have told the assessing officer that she did not recall of having made any transaction with Shri S Sabeer on 18-01-2005. On 18-01-2005, there was a transaction for exchange of money to the extent of Rs.3,00,051.50. The record does not show any transaction with Shri S Sabeer. Therefore, the money seized from the above said Shri S Sabeer cannot be related to the assessee. According to the ld.representative, there was no unaccounted purchase of foreign currency by the assessee. The ld. representative further submitted that the assessing officer, without any proper reason rejected the books of accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintained properly, according to the ld.DR, the assessing officer estimated the income at 1% on the gross transactions. According to the ld.DR, 1% of the net profit on the gross transaction is very normal, therefore, the CIT(A) has rightly confirmed the same. Referring to the addition of Rs.36,008, the ld. DR submitted that the assessing officer has rejected the claim of loss on money lending business. According to the ld.DR, there cannot be any loss in the money lending business. In the absence of any material to show that the assessee has suffered loss, the claim of loss was disallowed by the assessing officer which was rightly confirmed by the CIT(A). 4. We have considered the rival submissions on either side and also perused the mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee handed over Rs.3 lakhs in exchange of Saudi Rials. It is not known from the materials available on record, how much Saudi Rial was handed over by Shri S Basheer to Shri S Sabeer. It is also not known from the material available on record how much Saudi Rial was handed over to Smt. N Radhabai by Shri S Sabeer. However, from the material available on record it shows that Smt. N Radhabai handed over Rs.3 lakhs in exchange of some Saudi Rials. In the case of exchange trading which is regulated by Foreign Exchange Management Act, the assessee has to necessarily maintain certain statutory records both for Indian currency as well as for foreign currency. The opening stock and closing stock as on 18-01-2005 will show how much transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not conducted by the lower authorities to find out whether the transaction was made in exchange of Saudi Rials and if so what is the amount of Saudi Rials handed over to the assessee. In the absence of any material, this Tribunal is of the considered opinion that the matter needs to be reexamined by the assessing officer. Accordingly, the orders of lower authorities are set aside and the issue is restored to the file of the assessing officer. The assessing officer shall examine afresh and find out the opening and closing balance of Indian currency and foreign currency on 18-01-2005 and also find out how much Saudi Rials was handed over by Shri S Basheer to Shri S Sabeer, then Shri S Sabeer to Smt. N Radhabai. These details would defini ..... X X X X Extracts X X X X X X X X Extracts X X X X
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