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TMI Blog2015 (10) TMI 380X X X X Extracts X X X X X X X X Extracts X X X X ..... e on account of brick production expenses, clay excavation and carriage expenses and expenditure on water courses without appreciating the facts that assessee had altogether failed to produce the relevant support evidence to substantiate its claim of expenses which were entirely made in cash." 3. The brief facts of the case are that the assessment u/s. 143(3)/147 of the Income Tax Act was completed by the ACIT, Circle, Barmer on 13.3.2006 at the assessed income of Rs. 48,02,505/- after making disallowance out of expenses to the income returned of Rs. 8,09,760/-. Aggrieved by the assessment order of AO dated 13.3.2006, the assessee filed an appeal before the CIT(A) Jodhpur. The CIT(A), Jodhpur vide order dated 18.9.2006 decided the appeal o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the revenue has not filed any second appeal against the finding given by the CIT(A). This shows that the impugned order has been accepted by the department and assessment order to that extent stood merged with that of the Ld. CIT(A)'s order." The Order of the ITAT, Jodhpur dated 21.9.2007 is subsequent to the change of jurisdiction over the assessee when order u/s. 127 of the I.T. Act was passed by the CIT-II, Jodhpur on 18.9.2006. The CIT-IX, New Delhi is being requested to direct the ITO, Ward 27(2), New Delhi to file MA against the order dated 21.9.2007 of the ITAT, Jodhpur, as regard its observation on page no. 3 as also deciding the present jurisdiction over the appeal. Ld. AR of the assessee vide hearing dated 21.7.2011 before the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess. However, while framing assessment, he inter alia, made the following disallowances: a. Bricks Production Expenses - Rs. 28,59,057/- b. Clay Excavation and Carriage Expenses- Rs. 6,98,382/- c. Expenditure on water course - Rs. 2,25,746/- Total RS.37,83,185/- The assessee assailed the finding of the Assessing Officer in the first appeal. The ld. CIT(A) held that the Assessing Officer ought to have applied the provisions of see. 145 and then computed income. He took note of the trading results of the assessee at page 31 of the impugned order and came to hold that the G.P. rate was required to be enhanced by 1% instead of the specific additions as aforenoted, made by the Assessing Officer. He, therefore, made addition of Rs. 2,95,0001 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same as redundant. The duty of the Assessing Officer is to correctly. Apply proper section and compute the correct taxable income. Even otherwise, it is established procedure in the department that in contractor's cases, where books of account are defectively maintained and vouchers are not produced or they are self made) not open for verification, a particular N. P. rate is applied after rejecting the books of account. From the above extracted para it is obvious that the ld. CIT(A) had rejected the books of account maintained by the assessee and proceeded to determine the income by applying a particular profit rate, which we would advert to at a later stage. The contention of the ld. D.R. that the ld. CIT(A) had not rejected the book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h of the Tribunal has held in several cases that where the books of account are rejected, then recourse should be taken to the profit rate of the immediately preceding year unless facts justify departure therefrom. On a close examination of the G.P. rate declared by the assessee in this as well as the preceding year, it becomes patent that such rate of 7.55% in this year is better than of 6.47% in the immediately preceding years. In such a situation, there cannot be only question of applying a still higher GP rate for sustaining any trading addition, we therefore, order for the deletion of addition of Rs. 2,95,000/-" 5. We find that Department has not filed any Misc. application against the Tribunal's order dated 21.9.2007, hence, it is es ..... X X X X Extracts X X X X X X X X Extracts X X X X
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