9911796707
TMI Blog2016 (5) TMI 1506X X X X Extracts X X X X X X X X Extracts X X X X ..... quantitative details, it is presumed that out of goods valuing at 99609039/-, the assessee has sold 75.60% of goods on which he got discount and 24.40% of goods on which he did not get any discount. Apeals filed by assessee are partly allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) the assessee as well as Revenue had filed cross appeals and Hon'ble Tribunal vide order dated 17.02.2016 disposed off the appeals by holding as under: "22. We have heard the rival parties and have gone through the material placed on record. We find that the assessee has taken a jurisdictional issue in the AY 2008-09 by way of an additional ground, which during the course of hearing before us, was revised and which reads as under: "That the assessment having been reopened u/s 148 on the basis of cash deposit of ₹ 5,45,980/- in the bank account with Standard Chartered Bank, Jalandhar in the name of the assessee but no addition having been made for the same by the AO Thus, no income as a matter of fact having escaped assessment, it was not open to the AO to independently asses some other income, which is not part of the reason recorded u/s 148 by the A.O." 23. The reasons recorded for reopening of the case for the AY 2008-09 are placed at PB 108, which for the sake of completeness are reproduced below: "During the course of assessment proceedings in the case of the assessee for the assessment year 2009-10, an AIR information of cash deposits of ₹ 16,52,000/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view the facts the facts/information on record vide order dated 30.12.2011. assessment was completed for the assessment year 2009-10. Addition amounting to ₹ 2,55,92,341/- was made primarily on the basis of AIR information w.r.t cash deposits in the saving bank account. From the bank statement obtained from the bank of the same account, it is seen that cash amounting to ₹ 5,45,980/- has been deposited during financial year 2007-08 relevant to assessment year 2008-09 also. Since, it has already been admitted by the assessee that the source of deposits in this bank account is actually unaccounted sale proceeds of his business of trading in books/stationary items. Notice u/s 147/148 of the Income Tax Act,1961 dated 08.02.2012 was issued after recording the reasons for the same. The said notice stands duly served upon assessee on 09.02.2012." From the above findings, we note that he did mention the fact of deposit of cash amounting to ₹ 5,45,980/- in the AY 2008-09 and he has held that since the assessee had already admitted that the source of deposit in the bank account is unaccounted sale proceeds, therefore, he made the trading addition ignoring cash deposit as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact that the assessee had not recorded a part of sale in the regular books of accounts as he has already admitted that part of sale proceeds were deposited in the bank. Therefore, the AO and the ld. CIT(A) has rightly not considered the figure of sales for arriving at the cost of goods sold. However, the authorities below have rightly estimated the calculation of cost of goods sold on the basis of figures provided by the assessee in his trading account. The authorities below completely verified the purchases after calling information u/s 133(6) from the various suppliers of the assessee and from where the assessee was getting discount also. By completing the assessment, the AO did not allow benefit of free distribution of stationery and books which the assessee had claimed and which was one of the reasons for low gross profit ratio. Before the ld. CIT(A) complete details alongwith confirmations from Principals of various Schools alongwith details of books distributed free of cost were filed which were forwarded to the AO also. The ld. CIT(A) after obtaining the remand report from the AO had found the claim of the assessee as genuine and therefore, he rightly allowed the relief to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at market prices as apparently market value of such stock would have been lower than the cost price. In view of the above, these two arguments of the ld. counsel are rejected and the formula adopted by the ld. CIT(A) is upheld subject to application of gross profit rate worked out by him. The suppression of gross profit in various years by applying gross profit ratio based upon gross purchases and gross discount for three years is worked out as under: Asst. Year 2008-09 Total purchases made by the assessee. ₹ 3,24,13,274/- Purchases on which no discount was received ₹ 5002821/- (15.43%) Purchases on which assessee got discount ₹ 2,74,10,454/- Ranging from 10% to 50% (84.57%) Total purchases accounted for in the Books of account ₹ 3,24,13,274/- Total cost of sales as worked out by the Assessing Officer in the assessment order ₹ 1,95,75,634/- In the absence of any quantitative details, it is presumed that out of goods valuing at ₹ 1,95,75,634/-/-, the assessee sold 84.57% of goods on which he got discount and 15.43% of goods on which he did not get any discount. 84.57 cost of sales of goods ₹ 1,65,55,114/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 7,49,67,934/- In the absence of any quantitative details, it is presumed that out of goods valuing at ₹ 74967934/-, the assessee sold 83.9% of goods on which he got discount and 19.8% of goods on which he did not get any discount. 80.2% of cost of sales of goods ₹ 60124283/- 19.8% of cost of sales of goods ₹ 1,4843651/- Total cost of sales ₹ 74967934/- Gross profit @ 26.09 % on cost of sales of ₹ 60124283 ₹ 15686425/- Gross profit @16.5% on cost of sales of ₹ 14843651 ₹ 2449202/- Total gross profit earned by the assessee ₹ 18135627/- Less: Discount allowed by the assessee ₹ 14407113/- Balance gross profit ₹ 3728514/- Less: Gross profit declared by the assessee ₹ 2693796/- Undisclosed gross profit earned by the assessee ₹ 1034718/- The orders of learned CIT(A) are modified to the extent stated above and additions are restricted to the amounts of undisclosed gross profit as calculated above. In view of the above the appeals filed by assessee are partly allowed." In the present case, in the case of Revenue's appeals the Revenue is aggrieved with the de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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