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TMI Blog2016 (4) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... ell and there was increase in production and the gross profit rate was better than the last year; and therefore, no addition was called for. Agreed with the contention of the assessee, the CIT(A) granted relief to the assessee by observing that the assessee has taken machines on lease and has been paying lease rentals after deducting TDS. Further, he observed that there was increase in production during the year under consideration and the gross profit rate was also better. The CIT(A) also held that the addition could not be made merely because of increase in wages was not proportional to increase in production. Accordingly, he rightly deleted the addition in question by observing that the Assessing Officer was not justified in disallowing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oduction. 3. On the facts and circumstances of the case and in law, it is prayed that the order of the Ld. CIT(A) be set aside and that of the Assessing Officer may be restored. 2. The brief facts of the case are that the assessee is a firm engaged in the business of art silk cloth sarees. The assessee purchases grey cloth from local viewers and sells the same after getting processed from dyeing and printing mills. During the year under consideration, the assessee has shown gross profit of ₹ 33,16,757/- on total sales of ₹ 3,84,56,001/- which comes to 8.62% as against the gross profit of ₹ 28,90,990/- on the turnover of ₹ 3,56,39,770 with 8.11% in the immediately preceding year. 2.1 The only issue before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... achines taken on lease as on 31.03.2005 was 2, it was 80 as on 31.03.2006 and 102 as on 31.03.2004. Further, it was submitted by the assessee before the CIT(A) that there was proper agreement for lease. Lease rental were paid and TDS were deducted and in the ledger account, copy of lease rentals were shown under the head service charges. The copy of the account and details were also furnished. These details were sent to the Assessing Officer for his comments vide letter dated 23.03.2010 and 19.08.2010. Before the CIT(A), the assessee has also submitted that revenue stamp was affixed when payment exceeded ₹ 5,000/-, the employment of labourers was evident from the PF record as well and there was increase in production and the gross pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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