9911796707
TMI Blog2011 (6) TMI 952X X X X Extracts X X X X X X X X Extracts X X X X ..... t the order of CIT(A) dated 16.12.2009 for the assessment year 2002-03 in the matter of order passed u/s 143(3)/147. 2. The only grievance of the assessee relates to estimation of sales and profit thereon by the lower authorities and thereby making trading addition. 3. Rival contentions have been heard and records perused. The facts, in brief, are that the assessee is a country liquor contra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mination of books of account, no defect was found therein. The AO applied the proposition laid down by the Hon'ble M.P. High Court in the case of Badri Prasad Bhagwandas Co., 82 Taxman 109, and the sale of the assessee was estimated at 2.5 times of the license fee and profit thereon was estimated at 5 %. Accordingly, an addition of ₹ 8,01,916/- was made. The assessee filed appeal befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m sale price is fixed. However, the CIT(A) did not accept the assessee s contention and confirmed the action of the AO for estimation of sales and profit thereon. The assessee is now before us. 4. We have considered the rival contentions, carefully gone through the orders of the authorities below and found from record that the assessee was maintaining regular books of account and the same were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted u/s 145(2). Even as per the proposition of law u/s 144, whenever there is a rejection of books of account, the AO is empowered to estimate the correct income of the assessee as per material placed before him. However, where the books of account are found to be correct and no defect is found therein, no power has been conferred to the AO for estimating profit by disregarding the book result sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justification for applying the proposition of law laid by the Jurisdictional High Court in the case of Badri Prasad Bhagwandas Co.( supra). Accordingly, we are inclined to reverse the order of the lower authorities and direct the AO to delete the addition made by him by estimating sales and profit thereon. 5. In the result, the appeal of the assessee is allowed. This order has been pronou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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