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TMI Blog2018 (4) TMI 1526X X X X Extracts X X X X X X X X Extracts X X X X ..... AO was not justified in presuming that the assessee earned commission on the purchases of goods (Biri) - neither the AO nor the ld. CIT(A) had given any basis for adopting the rate of Commission/Profit at 2%, therefore, the addition made by the AO and sustained by the CIT(A) was not justified. Accordingly, the same is deleted. - Decided in favour of assessee. - ITA No. 94/Del/2017 - - - Dated:- 26-4-2018 - Sh. N. K. Saini, Accountant Member For The Assessee : Sh. Gautam Jain, Adv. For The Revenue : Sh. B. R. Mishra, Sr. DR ORDER This is an appeal by the assessee against the order dated 17.10.2016 of ld. CIT(A), Hisar. 2. In this appeal although 9 grounds have been raised but the only grievance of the assessee r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Lo ₹ 2,59,674/-. Hence, the difference of ₹ 4,82,252/- (Rs.7,41,926 -Rs,2,59,674) is treated as income of the assessee from undisclosed sources and accordingly added back towards his taxable income. 4. Being aggrieved the assessee carried the matter to the ld. CIT(A) who sustained the addition by observing in paras 4.2 4.3 of the impugned order as under: 4.2 I have carefully examined the facts of the case. The appellant in its written submissions has only tried to controvert findings of the AO. However, no fresh evidence regarding sales of Biris etc. have been brought on record by the appellant. Appellant has stated that cash has been deposited on same date on which cheque has been issued. This does not prove th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e sales made. From the nature of transactions recorded by the AO, it appears that appellant has only been granting accommodation entries to the party in Rajasthan for the purposes of avoiding payment of VAT @ 20%. Appellant has apparently recorded entries in its books wherein cheques have been issued against deposit of cash on which appellant has earned commission income. In the absence of any further evidence to the contrary, regarding actual sales of Biris by the appellant, the calculation made by the AO of earning commission income @ 2% is therefore confirmed. On the total sales of ₹ 4,25,10,624/- appellant has declared GP of ₹ 2,96,758/- only which gives a GP rate of 0.70%. After granting benefit of GP @ 0.70% declared by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the items shown in the books of account or profit and loss account and balance sheet drawn on that basis are incorrect. Therefore, the question of application of rate of net profit, i.e. 2% commission on purchases, does not arise on the facts of the case. iv) It is further submitted that as per the version of the Ld. A.O. neither any purchases nor any sale have been made, then why the commission @2% on purchases is treated as an income of the appellant. Hence, from the above facts and submissions, it is very much clear that the inference of not purchasing or selling the goods drawn by the Ld. A.O. is not based on the facts of the case and you are requested to set aside the order of the Ld. A.O. and addition made on this issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with description of goods (biri), quantity, rate, amount, CST charged @2% are very much available on record. ii) That copy of GR showing the name and address of the transporter who delivered the goods to the appellant and quantity of delivered and freight charged by the transporter are also very much available on record. iii) That all the purchases have already been accounted for in the regular books of accounts and have been shown in LP-3 (list of purchases of goods made from the outside of the states) submitted to the Excise and Taxation Department, Fatehabad along with quarterly return who have issued statutory 'C' forms for purchasing goods (biri) from outside the state of Haryana. iv) That all the payments to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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