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TMI Blog2020 (3) TMI 1014X X X X Extracts X X X X X X X X Extracts X X X X ..... see, especially in absence of non-production of manufacturing account and non-furnishing of details to arrive at the actual value of items consumed and the value of closing stock. However, going by the past results and considering the totality of the facts of the case, we are of the considered opinion that adoption of 4% GP in the instant case will meet the ends of justice. We, therefore, direct the AO to adopt the GP rate of 4% and recompute the disallowance. Addition on account of disallowance of interest - Held that:- neither any specific ground has been taken before the Tribunal nor anything was argued by the assessee on this issue although the assessee in the general grounds of appeal has challenged the entire addition made by the AO. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to explain as to why there is no manufacturing account since there is no manufacturing account in the books of account. The ld. AR of the assessee who appeared along with the partners confessed that it is not possible to provide manufacturing account as it cannot be made. The AO noted that the assessee makes a mixture of hing, gum, starch and oil to make adulterated hing which is sold in the market. The proportion of four items in the mixture is not fixed or specified. The proportion of these items to create this mixture depends on how much money is being paid by the customer. He, therefore, inferred that the proportions of the four items to make the mixture of the adulterated hing varied from customer to customer and according to the rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Even though CIT(Appeals) noticed this contention as a matter of fact, the said authority did not render any finding. The ITAT instead went by the findings of the lower authority and merely based its conclusion on the interpretation of Section 145(2) of the Income Tax Act, 1961. In fact, there is an assumption in para 9 that the assessee did not maintain quantitative details of ingredients such as mixing gum, starch and oil. 9. This Court is of the opinion that having regard to the assessee's stand that such details were forthcoming both by way of books as well as through a quantitative tally, the CIT (Appeals) should have addressed himself to the issue and rendered clear findings. Failure to have done so has prejudiced the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to make which quality of hing, cannot be ascertained from this record. As Hon. ITAT, in its order, in miscellaneous application No.63/Del/2014 dated 25/09/2014 had observed that "maintaining quantitative details of manufacturing account and maintaining quantitative tally of purchases sales etc are different things." I am afraid, that the facts and circumstances have not changed a bit, since then. There is nothing new in what the appellant is submitting as argument or evidence. Even before me during the appellate stage the ld AR has stated categorically that it was neither possible nor desirable to maintain the stock register from which the manufacturing account could be prepared. How and how much of an item of raw material is consumed can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry in face of no defect in books having been found specially in face of results having been accepted upto Hon'ble Delhi High Court in Appellant's case as well as Appellant's sister concern for last more than 30 years. 4. The CIT(A) has proceeded on surmises ignoring factum of quantitative tally in the ledger which is a sort of stock register because it contains purchases and sales in quantity. It is prayed that above addition of ₹ 54,92,680/- may kindly be deleted." 8. We have considered the arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We find the AO, in the instant case, rejected the book results and adopted 10% GP on the ground that the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition sustained by the CIT(A) should be deleted. We do not find force in the argument of the ld. Counsel for the assessee, especially in absence of non-production of manufacturing account and non-furnishing of details to arrive at the actual value of items consumed and the value of closing stock. However, going by the past results and considering the totality of the facts of the case, we are of the considered opinion that adoption of 4% GP in the instant case will meet the ends of justice. We, therefore, direct the AO to adopt the GP rate of 4% and recompute the disallowance. So far as the addition on account of disallowance of interest is concerned, neither any specific ground has been taken before the Tribunal nor anything was argued by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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