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TMI Blog2019 (5) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessed by the Assessing Authority. Estimate of Income, in such cases, even undertaking Best Judgment Assessment exercise while rejecting the Books of Accounts and Profits of the Assessee, is a fact finding exercise to be made, based on material to be placed on record by the Assessee. In the absence of any evidence placed by the Assessee in this regard, the Assessee cannot simply contend that Estimate of Income at 3.5% is unreasonable or perverse. The three authorities below have consistently upheld the said 'Ratio of Profit', to be assessable in the hands of the Assessee, and the Assessee has consistently failed before the authorities below to produce any cogent material to establish that 1% was reasonable Ratio of Profit in the said trade. Therefore, we do not find any Substantial Question of Law arising in this case and, accordingly, we do not find any merit in this Appeal filed by the Assessee. - T.C.A.No.676 OF 2018 - - - Dated:- 2-4-2019 - Dr. Justice Vineet Kothari And Mr. Justice C.V. Karthikeyan For the Appellant : Mr.N.V.Balaji For the Respondent : Mr.T.R.Senthil Kumar, Senior Standing Counsel. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Collected at Source ' by the Seller- M/s.Manappuram Finance Ltd .- could be given credit or refunded in the hands of such purchasers. But, the Assessee failed to disclose the details before the Assessing Authority in the Return of Income filed by him. The Assessee had claimed a refund of such Tax Collected at Source by M/s.Manappuram Finance Ltd, to the extent of ₹ 17,45,898/ -. 5. The Assessing Authority held that on account of failure of the Assessee to furnish the details of the purchasers, the Authority would estimate the income of the Assessee at 3.5% of the turnover of gold purchased and sold by him and not 1% as disclosed by him. This resulted in addition of ₹ 58,15,990/ - under Section 69A of the Act in the hands of the Assessee. 6. A perusal of the Assessment Order, dated 05.02.2016, for Assessment Year 2013-2014 in the present case reveals that the Assessing Authority had given a Show Cause Notice to the Assessee for estimating the income of the Assessee at 3.5% as against 1% and the Assessee also filed a Reply to the said Show Cause Notice, dated 02.02.2016, but could not adduce any evidence with regard to average p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im credit of TCS against the tax chargeable on that income. Another absurdity in this claim is that income offered is equivalent to tax credit sought against that income which in any case does not belong to him for the reasons stated above. In fact, the appellant did not produce any evidence in support of actual quantum of commission earned from this business. Under these circumstances, I am convinced that the AO has rightly estimated income corresponding to refund already paid and income so estimated clubbed with income already offered works out to 3.5% of purchases as proposed by the AO during the assessment proceedings. Accordingly, the addition made is upheld and grounds are dismissed.'' Order of ITAT, dated 28.02.2018 : ''9. We have considered the rival contentions and perused the orders of the authorities below. Though the assessee states that he was participating in old gold auction done by M/s.Manappuram Finance Ltd. on behalf of various parties, he could not produce any confirmation from any such parties. Form No.26AS was in the name of the assessee and this admittedly reflected purchases of gold worth ₹ 23, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said Assessee dealing with turnover of pure gold was less than 1%. He further submitted that the Best Judgment Assessment framed by the Assessing Authority has to be a fair and reasonable estimate of the profit. 9. On the other hand, Mr.T.R.Senthil Kumar, learned Senior Standing Counsel for the Respondent-Revenue, supported the impugned orders and submitted that had the Assessee disclosed the details of the purchasers, the Assessing Authority not only could have inquired into the matter further, but could have also given credit of the Tax Collected at Source to the respective purchasers, on whose behalf the present Assessee acted, and the Assessee, in any case, was not entitled to claim any credit of such Tax Deducted at Source by M/s.Manappuram Finance Ltd., the Seller of gold. The learned Standing Counsel also submitted that the Assessee was given due Show Cause Notice with regard to estimating profit, assessable in his hands at the rate of 3.5%, but he failed to prove with evidence his claim of 1% Profit Ratio, as disclosed by him. 10. Having heard the learned counsel for the parties and upon perusal of the orders passed by the authorities be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be assessable in the hands of the Assessee, and the Assessee has consistently failed before the authorities below to produce any cogent material to establish that 1% was reasonable Ratio of Profit in the said trade. 14. Reliance placed by the learned counsel for the Assessee on the order of the Tribunal at Hyderabad in Income Tax Officer v . M/s.Vonamala Jagadishwaraiah , cited supra, is hardly of any help to the Assessee, as the Assessee therein apparently dealt with large scale of turnover of pure gold and the Table extracted by the Tribunal in its order for Assessment Year 2009-2010 was dealing with Assessment Years from 2007-2008 to 2011-2012, where the turnover of over ₹ 300.00 crores to ₹ 500.00 crores was involved, whereas, the turnover in the present case is only to the extent of ₹ 23.00 crore and odd. Therefore, the 'Ratio of Profit' of the said Assessee, as was being dealt with by the learned Tribunal in that case, cannot be a yardstick to estimate the income of the Assessee in the present case. Even the said order of the Tribunal does not appear to have remitted the case to any of the authorities below, which, per se, does ..... X X X X Extracts X X X X X X X X Extracts X X X X
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