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TMI Blog2018 (5) TMI 585X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer passed an order on 13.02.2017. The assessee filed an appeal before the CIT(Appeals) and the CIT(Appeals) confirmed the addition made by the Assessing Officer against which, the assessee filed appeal in I.T.A. No.2569/Chny/2017. Therefore, we heard both the appeals of the assessee together and disposing of the same by this common order. 2. For the sake of convenience, first let's take I.T.A. No.2489/Chny/2016. 3. Shri D. Anand, the Ld.counsel for the assessee, submitted that there was a search in the premises of the partners of the assessee on 24.09.2012. According to the Ld. counsel, during the course of search operation, cash was found and seized. The partners of the assessee-firm admitted that the cash found was incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as on 01.04.2012. Therefore, according to the Ld. counsel, the order of the Assessing Officer is not erroneous. Moreover, no prejudice is caused to the Revenue, therefore, the Principal Commissioner is not correct in revising the order of the Assessing Officer in exercise of his jurisdictional power under Section 263 of the Act. 6. On the contrary, Smt. Ruby George, CIT, the Ld. Departmental Representative, pointed out that the original assessment was completed under Section 143(3) of the Act on 31.07.2014. According to the Ld. D.R., the partners of the assessee-firm admitted an unaccounted income to the extent the cash was found during the course of search operation. When the assessee admitted through its partners that the entire unaccou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the income returned by the assessee in the return of income to the extent of Rs. 11,39,930/-. The Principal Commissioner found that what was disclosed by the assessee and assessed by the Assessing Officer is in respect of the unaccounted income generated outside the books of account. Therefore, the Principal Commissioner found that the Assessing Officer has not made any proper enquiry to find out the income generated by the assessee from the business carried on as per the books of account. The Principal Commissioner also found that the unaccounted income admitted by the assessee during the course of search operation cannot be considered to be part of book profit for the purpose of computing partners' remuneration under Section 40(b)(v) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gross profit of Rs. 1,37,36,083/- with G.P. ratio of 0.36% till 22.09.2011. In the post search period, i.e. from 22.09.2011 to 31.03.2012, the assessee has declared a loss of Rs. 75,80,388/- as per the books of account. According to the Ld. counsel, the Assessing Officer completed the assessment by ignoring the loss as per the books of account and estimated the gross profit at 0.17%. The Assessing Officer has not rejected the books of account at any point of time despite the fact that the assessee maintained regular books of account. Moreover, according to the Ld. counsel, no defect was found by the Assessing Officer in the books. On appeal by the assessee, according to the Ld. counsel, the CIT(Appeals) ignored the fact that there was no d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e purpose of ignoring the loss claimed during the post-search period. 13. We have considered the rival submissions on either side and perused the relevant material available on record. The CIT(Appeals) found that the Assessing Officer estimated gross profit at 0.17% without any comparison. Equally, the CIT(Appeals) found that the assessee could not substantiate the claim of low gross profit. Therefore, he estimated the gross profit at 0.12%. The fact remains that the assessee maintained the books of account in its regular course of business and the books were not rejected by the Assessing Officer. Moreover, no error was also pointed out. The Assessing Officer as well as the CIT(Appeals) were under the impression that in the bullion trade, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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