9911796707
TMI Blog2014 (6) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... turn of income for the year under consideration was filed by the assessee on 8.10.2007 declaring total income of Rs.10,20,372/-. During the course of assessment proceedings, the books of accounts and record maintained by the assessee were verified by AO and on such verification, he found that the register of material purchases and consumed was not maintained by the assessee. He also found that the majority of the cash expenses were not supported by any vouchers. He also noted that salary to two employees amounting to Rs.99,600/- was debited in the books of account of the assessee entirely in the month of March 2007. The assessee was also found to have claimed prior period expenses and the purchase account was also debited by the assessee on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee that in the absence of any material defect or serious discrepancy found in the sales disclosed by the assessee, the estimate of sales made by AO at 3.60 crores without any basis was not justified. The ld. CIT(A), however, upheld the action of the AO in rejecting the books of account of the assessee on the basis of material defects pointed out therein and held that in the facts and circumstance, it was more appropriate to apply reasonable net profit rate to the sales declared by the assessee for estimating the income of the assessee from business. In this regard, he noted that the assessee itself has disclosed net profit of about 13% in the subsequent year whereas in the earlier year, the assessee had disclosed net profit of 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rofit rate be applied in the case of assessee to estimate the business income was quite fair and reasonable in the facts and circumstances of the case warranting no interference. Similarly, very fair view was taken by the ld. CIT(A) to restrict the disallowance of Rs.5 lakhs made by AO on account of unverifiable expenses to Rs.38,665/ keeping in view the remand report submitted by the AO after verification of the expenses claimed by the assessee. We find no justifiable reason to interfere with the same. It is pertinent to note here that the addition made by the AO by estimating sales of the assessee at higher figure was deleted by the ld. CIT(A) vide his impugned order by giving substantial relief to the assessee and nothing has been brough ..... X X X X Extracts X X X X X X X X Extracts X X X X
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