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TMI Blog2017 (3) TMI 1300X X X X Extracts X X X X X X X X Extracts X X X X ..... on the ground that such an addition will result in reasonable gross profit. There is no reason to doubt genuineness and bonafides of these debit notes. - Decided in favour of assessee - ITA No.1111/Ahd/2013 - - - Dated:- 10-3-2017 - Pramod Kumar AM For The Appellant : M.J. Shah, For The Respondent : Kailash Dan Ratnoo ORDER 1. By way of this appeal, the assessee has challenged correctness of the order dated 4th March 2013, passed by the learned CIT(A), for the assessment year 2009-10. 2. In the first ground of appeal, the assessee has raised the following ground of appeal :- 1. That the learned CIT (Appeals) erred in law and on facts in confirming addition made by Ld. Assessing Officer on account of Low G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The submission of the assessee have been carefully considered and the same is found to be self serving and devoid of any merits in law considering the following facts of the case. The AR of the assessee has stated as mentioned above that the calculation shown for comparing Gross Profit is not correct. For the comparison of Gross Profit item the trading account has to be taken on equal footing. Abnormal/Accidental/Casual Income or Expenditure has to be sorted out. The discount of ₹ 4,19,175/- is trade discount received from Purchase parties. The comparative figure of trade of trade discount of A.Y. 2008-09 is ₹ 3,05,827/- which is separated from purchase then same item in A.Y. 2008-09 has to be separated from purchase an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn @ 3.15%. If the said debit note amount (Discount) of ₹ 4,19,175/-, included in purchases, your G.P. comes @ 21.49% which is very Low compared to immediate preceding year. Therefore, after considering all the submissions and arguments put forth by the assessee, the assessee has not explained the fall in G.P fully with supporting evidence. Therefore, the debit note (discount received by the assessee from the purchase parties and the assessee has manipulated/increased ratio of G.P. from this debit note amount) ₹ 4,19,175-, which is most reasonable addition against discrepancies noticed and thus the same is added to the total income of the assessee. [Addition of ₹ 4,19,175/-] 4. Aggrieved, assessee c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd duly considered facts of the case in the light of applicable legal position. 7. I find that there is no finding by any of the authority below about any specific defects in the books of account, and yet an addition has been made to the profit disclosed by the assessee. The business situations can never be so static as to permit a uniform gross profit rate over the years. The gross profit rate being too low cannot be reason enough to reject the books of account, and make gross profit addition. I cannot, therefore, uphold the action of the authorities below in adding the value of debit notes of ₹ 4,19,175/- only on the ground that such an addition will result in reasonable gross profit. There is no reason to doubt genuineness and b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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