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TMI Blog2018 (6) TMI 1181X X X X Extracts X X X X X X X X Extracts X X X X ..... as qualitative details of stock so as to arrive at the true profits for the impugned AY. The assessee has apparently not maintained these qualitative details and merely harping on the point that furnishing of quantitative details was sufficient enough to discharge the obligation casted on him in this regard. We are not convinced with the same particularly in view of the fact that the assessee has undertaken majority of the transactions with the related party. Further, we find that the month-wise quantitative details as given in summary of stock for the period 2009-2010 do not matches with ledger extract of monthly summary of cut & polished diamonds. Keeping in view the totality of facts, we deem it fit to restore the matter back to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le cases furnish by the assessee without appreciating that the assessee had not furnished any details of how the cases are squarely comparable. 1(d). On the facts and in the circumstances of the case, the Ld. CIT(A) erred in allowing relief to the assessee against the finding communicated by the AO in his remand report that the assessee had made sales amounting to ₹ 79,68,06,818/- to related parties and also made purchases from related parties amounting to ₹ 9,09,80,797/- which fact has been mentioned in the Auditors Report in Para v(b) and the assessee avoided disclosure of the true facts of the transactions by not furnishing the details in respect of these transactions. 2. The appellant prays that the order of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me, the Gross profit of the assessee was estimated @4.39%, being average of profit reflected by five comparable entities as extracted on Para 4.4 of the quantum assessment order. The said estimation resulted into an addition of ₹ 919.62 Lacs in the hands of the assessee. 3. Aggrieved, the assessee contested the same with partial success before Ld. CIT(A) vide impugned order dated 18/11/2015 where the matter was concluded in the following manner:- 4.2 I have gone through the facts and circumstances of the case. I have also gone through the details submitted by the appellant to substantiate his claim and the rulings relied on. From the facts it is seen that the AO has collected five comparables and found the average GP at 4.39% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he conclusion that books cannot be simply rejected because the quality details were not supplied. While dealing this case the Ahmedabad bench has also relied on its earlier decision in the case Dharani Brothers in ITA NO.2309/2008 dated 06.08.2010. It is also pertinent to note in the instant case that book results were accepted for AY 2009-10 and AY 2012-13 by concluding the assessment under section 143(3) and the method of accounting was never questioned therein. 4.2.2 In the remand report the AO has suggested to reject the comparables given by the appellant and requested to adopt the average GP arrived at by the AO. The AO has also noticed that the details with regard to sale and purchase from related parties, as pointed out in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rit, I hereby direct the AO to rework the GP and adopt the average GP of 0.05% for assessment purpose in place of 4.39% adopted by the AO. The ground is partly allowed. Aggrieved, the revenue is in further appeal before us. 4. The Ld. Departmental Representative [DR], pointed out that Ld. CIT(A) erred in providing relief to the assessee since the assessee could not produce adequate stock details before Ld. AO to justify the profitability. It was further submitted that the assessee undertook majority of the transactions with related party and therefore, the profit reflected by the assessee was not reliable. Per Contra , Ld. Authorized Representative for assessee [AR], drawing our attention to the documents placed in the paper-book, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f profit reflected by the comparables was not justified and therefore, the action of Ld. AO, to that extent, could not be sustained. 6. At the same time, it is also noted that the assessee was dealing in varied quality of diamonds, the price of which ranged from $28 to $9400 which necessitate the assessee to maintain adequate quantitative as well as qualitative details of stock so as to arrive at the true profits for the impugned AY. The assessee has apparently not maintained these qualitative details and merely harping on the point that furnishing of quantitative details was sufficient enough to discharge the obligation casted on him in this regard. We are not convinced with the same particularly in view of the fact that the assessee ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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