9911796707
TMI Blog2015 (12) TMI 1500X X X X Extracts X X X X X X X X Extracts X X X X ..... nder consideration. Further, the assessee has demonstrated through the chart (reproduced above) that with the change in sale price of the petroleum products, the margin in the hands of the assessee remains the same. Further, we agree with the contention of the ld. A/R that since the revenue has not challenged the finding of the ld. CIT (A) wherein he has held that books of account cannot be rejected, revenue cannot be allowed to take the ground that ld. CIT (A) has erred in deleting the trading addition. In the light of above, we do not find any infirmity in the order of ld. CIT (A) - Decided against revenue. Disallowance of salary expenses made by AO u/s 40A(2)(b) - CIT(A) deleted the addition - Held that:- We believe that ld. CIT (A) h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition of ₹ 11,49,127/- made by AO; ii) Deleting the disallowance of salary expenses of ₹ 69,300/- made by AO u/s 40A(2)(b) of the Act. 2. Regarding first ground of appeal, brief facts of the case are that the assessee is a partnership firm doing the business of purchase and sale of petrol and diesel products of Indian Oil Corporation at Kota. It has filed its return on 06.09.2009 declaring an income of ₹ 22,91,270/- which was selected for scrutiny and assessment was completed under section 143(3) of the I.T. Act. During the course of assessment proceedings, the AO noticed that the assessee has declared a turnover of ₹ 33.11 cr. and declared a GP rate of 1.52% as against turnover of ₹ 26.17 cr. and GP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchase and sale rates of various product is determined by the Oil Marketing Company (Indian Oil, HPCL, BPCL etc.). The assessee is also required to maintain various registers by the Oil Marketing Company as well as State Government. Therefore, the books of accounts/trading results cannot be rejected without bringing specific defects on record. The AO is, therefore, directed to delete addition of ₹ 11,49,127/-. 4. The ld. D/R relied on the order of the AO and justified the trading addition of ₹ 11,49,127/-. 5. On the other hand, the ld. A/R of the assessee submitted that firstly the department has not challenged the finding of ld. CIT (A) that the books of accounts cannot be rejected . Therefore, this finding of ld. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sa 69.71 1.97% 1.75% Petrol 05.06.2008 48.74 54.08 ₹ 1.13 ₹ 1.13 2.07% 1.87% Xtra Premium 17.06.2008 51.74 58.08 ₹ 1.26 ₹ 1.26 2.44% 2.17% 6. We have heard the rival contentions and perused the material available on record. Firstly, it is not under dispute that the assessee is in a line of business of petroleum trading wherein both purchase of petroleum products as well as subsequent sale thereof are go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to ₹ 1,65,300/-. As per the AO the said salary given to Shri Naresh Pareek is excessive specially when he has no experience of business and also that another employee Shri S.N. Pareek who has a lengthy experience of 15 years in the said line of business has been paid a monthly salary of ₹ 4,700/- during the year. The ld. A/R submitted that there was necessity to manage the business more scientifically and also to deal with the company in more efficient manner. Hence need was felt to appoint some qualified person and accordingly Shri Naresh Pareek who holds a Post Graduate diploma in Management was hired at a monthly salary of ₹ 15,000/-. The ld. A/R also submitted that education and experience both are important things ..... X X X X Extracts X X X X X X X X Extracts X X X X
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