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TMI Blog2013 (3) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... closed in the immediately preceding year. The N.P. Rate of this year is better than the earlier year. Therefore, no addition, like one made by the A.O. is not justified. The ld. CIT(A) has also confirmed the same. On a wrong premise by following the reasons given by the A.O. and by not considering the contention of the assessee. In out considered opinion the first time imposition of Entry Tax of huge amount of 9,69,454/- as per assessee Paper Book page 18, which fact has not been denied or disputed by the revenue, is a good ground and factor to justify small fall in the G.P. Rate. Thus delete the entire addition Interest received from F.D.Rs. and N.S.Cs. placed with Government while obtaining contract from Government is required to be asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee has come in second appeal against the sustained additions. 3. At the time of hearing, the appellant's authorized representative, Shri U.C. Jain, the ld. Advocate chose not to press Ground No. 1. Therefore, this ground stands dismissed as not pressed. 4. Facts of second ground are that the A.O. has disallowed portion of expenditure claimed in the businesses carried under the following names: a. M/s L.R. Filling Station, Jaisalmer of ₹ 30,000/- b. M/s Naveen Tractor, Jaisalmer of ₹ 1,00,000/- Both these disallowances are made on account of non-maintenance of proper vouchers/bills for various expenses and because full record of the expenses did not tally with the claim of the assessee. However, A.O. has made a lumpsum dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fter rejecting the books of account on various grounds stated in the earlier part of this order, the A.O. has applied a net profit rate of 12.50% further subject to depreciation and interest to third parties. Although the assessee has not disputed the rejection of books of account but has vehemently contested addition made and sustained in this account. It was submitted that there cannot be uniformity in the margin of profit from the year-after-year as the rate of profit earned by the assessee depended on various factors including huge increase in the turnover. It was argued that even after a fall in the gross profit rate the net profit rate is better in the year, so no addition is warranted. He also attributed fall in gross profit rate to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 006-07 70388982.00 7521542.00 10.69% 4636778.00 6.59% 2007-08 40246198.00 6155118.00 15.00% 2236893.00 5.56% 2008-09 114390319.00 10653914.00 09.32% 7561682.00 5.72% From the above it becomes evident that there is slight fall in G.P. Rate but there is slight increase in the N.P. Rate as compared to immediately preceding years, whereas the turnover has tremendous by increased manifolds in the year as compared to the earlier year. It is also found that no defect much less any material defect has been pointed out by the A.O. in the books of accounts of the assessee maintained regularly during the course of business. No matter what if the assessee has not challenged rejection of the books of accounts, but the A.O. has not di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of this order. All these decisions support the case of the assessee. Accordingly, we order to delete the entire addition of ₹ 26,25,393/- made and allow ground Nos. 3 and 4 of this appeal. 10. The facts apropos ground No. 5 and 6 are in respect of sustained addition of ₹ 35,36,307/- in the trading account of M/s. Choudhary Stone Crushing Company. The facts and arguments of both parties in this regard are more or less same and similar. The comparative position of trading results in this business are as under :- A.Y. GROSS RECEIPTS G.P. G.P. RATE NET PROFIT N.P. RATE 2006-07 140200 14018 10.0% (-)63042 (-)459% 2007-08 54958588 3846518 07.00% 3354497 6.10% 2008-09 48870101 3301603 06.75% 2936308 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /JU/2010 A.Y. 2007-08 (copy enclosed at page 29 onwards), in which has been held thus :- "We have heard both the parties on this issue. The assessee has declared interest paid to third parties amounting to ₹ 35,83.211/-. Interest received to the extent of ₹ 3,00,681/- was reduced from the interest for claiming deduction in respect of me interest paid to third parties. In case interest is to be treated as income from other sources then deduction out of net profit rate on account of interest to third parties will have to be allowed to the extent of ₹ 35,38,211/-. Thus it is only a Revenue neutral issue. The IT AT, Jodhpur Bench in the case of Radha Krishan Beniwal vs. ACJT (ITA No. 115/JU/09 dated 09.07.2009) held that int ..... X X X X Extracts X X X X X X X X Extracts X X X X
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