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TMI Blog2018 (9) TMI 1404X X X X Extracts X X X X X X X X Extracts X X X X ..... of liquor - AO rejected the audited books of account of the assessee and completed the assessment by estimating the income from business @ 8% of cost of goods put to sale in case of Bar and Restaurant and @ 5% in case of wine business - Held that:- We direct the AO to adopt 3% of the cost of goods sold as the income of the assessee relating to Wine business. As regards estimation of income @ 8% of cost of sales in the case of Bar & Restaurant, we confirm the findings of AO as the same was in line with the provisions of section 44AD. - ITA No. 2043/Hyd/2017 - - - Dated:- 19-9-2018 - SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER For The Assessee : Shri Y.V. Bhanu Narayan Rao For The Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kothaguden Wines ₹ 9,54,660/-. 3. Aggrieved, the assessee preferred an appeal before the CIT(A). 4. Before the CIT(A), it was contended that the AO estimated the income is on higher side considering the fact that business is predominantly carried out in mofusil area. Referring to the decisions of the ITAT, Hyderabad, the assessee submitted that estimation of net profit @ 3% of goods put to sale in case of wine business is reasonable and estimation of net profit @ 8% of cost of goods put to sale in case of Bar and Restaurant is on higher side. 5. After considering the submissions of the assessee, the CIT(A) confirmed the order of AO. 6. Aggrieved by the order of CIT(A), the assessee is in appeal before us raising the follow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rws 147 of the Act, we find that there is no discussion about this issue by the CIT(A), though the assessee has raised this ground before him. We notice that the assessment completed u/s 143(1) and not u/s 143(3) and there was no opportunity for the AO to form an opinion. Subsequently, it was noticed by the AO that the income was escaped assessment. Accordingly, notice was issued and assessment was completed u/s 143(3) r.w.s. 147. We do not see any issue with the completion of assessment or issue of notice u/s 148. Therefore, ground raised by the assessee is dismissed. 9. Considered the rival submissions and perused the material on record. As regards ground No. 4, the coordinate benches of this Tribunal consistently taking view that est ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is Tribunal has taken note of the decision of Hon'ble High Court of Telangana and Andhra Pradesh inITA.No.1198/Hyd/2015 Sai Venkateswara Wines, Secunderabad the case of CIT vs. Kamlekar Shankar Lal (supra) to hold as under : 6. Having regard to the rival contentions and the material on record, we find that the AO has called for books of account of the assessee but the assessee had failed to produce the same. Therefore, AO had estimated the income of the' assessee at 2.5% of the turnover. The CIT wants the same to be estimated at 5% of the total turnover because the Tribunal in the case of an assessee carrying on the same business of sale of IMFL has estimated the income at 5% of the turnover. This, in our view, is not justifi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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