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TMI Blog2017 (12) TMI 854X X X X Extracts X X X X X X X X Extracts X X X X ..... ases for estimation at 2%. As assessee has not furnished the books of account for verification and in earlier years, the return of income was accepted u/s. 143(1) and not scrutinized, it is of the opinion that the income can be estimated at 1% of the turnover given in the facts of the case. Therefore, the AO is directed to modify the order restricting the profit estimation to 1% of the turnover. The grounds are accordingly, partly allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... profit at 2%. He also disallowed deduction under Chapter VIA of ₹ 63,538/- claimed by assessee. 4. Assessee contended the same before the CIT(A) submitting as under: "The appellant humbly submits that she is in the business of cotton. The stock details were maintained and yield statement was also filed along with the return of income. The appellant maintained proper books of account and proper vouchers are also available. The appellant could not present on the dates of hearing as she was bedridden at the relevant point of time and also undergone surgery for hypertension and other connected problems. The Assessing Officer did not find fault with the quantitative details submitted along with the return of income. The appellant, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons in his detailed order as under: "4.6 Best Judgement Assessment: From the details mentioned in para 4.1 to 4.3, it is seen that the assessee did not comply with requirements of the statutory notices issued by the Assessing Officer during the assessment proceedings. The conduct of the assessee during the assessment proceedings is apparent from the record of events as narrated in the order sheet. The AO fixed the case for hearing from 22.09.2014 to 02.02.2016 i.e. almost for one and half years. There is no justifiable reasons for the same. There were repeated non-compliances to such notices, which is apparent from assessment record. Since the books of accounts and the supporting details, bills and vouchers were never produced before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a proper basis or whether they really constituted a device for the purpose of evading the payment of income-tax or super tax. This is so even when the accounts had been audited and certified by a competent accountant, for it may be that in computing the 'profits and gains' of a business, many items shall have to be deducted though these may not be expenditure at all and expenses passed by an auditor may not be expenses allowable under the IT Act and vice versa. Unless expenditure can be brought under the provisions of the Act, it cannot be allowed as a deduction in computing the profits from the business. [Lakshmi Narayan Sen & Sons Ltd., In re (1936) 4 ITR 255 (Cal)]. 4.8 Estimation: From the facts of the case and the conduct of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d submissions, I am satisfied that assessee has sufficient cause to file appeal belatedly and the delay of 35 days is hereby condoned and appeal is admitted. 7. It was the contention of Ld. Counsel that the books of account are maintained and the returns in earlier years are accepted without any further verification. It was submitted that the assessee has earned only 0.3% and 0.5% profit in earlier years and so estimation at 2% is on higher side. It was pleaded that the book results may be accepted. 8. Ld.DR, however, pointed out that assessee has not cooperated with the AO during assessment proceedings and before CIT(A) also only written submissions were filed. So, rejection of books of account and estimation of income is proper on the f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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