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TMI Blog2018 (1) TMI 1721X X X X Extracts X X X X X X X X Extracts X X X X ..... l is dismissed. Addition u/s 68 - assessee has failed to substantiate the identity and creditworthiness of the creditors and genuineness of transaction, the AO disallowed the same - CIT(A) observed that the assessee has furnished compete postal address and PAN particulars of the creditors and address of the creditors to the Assessing Officers with whom the creditors are assessed to tax, thus deleted addition - HELD THAT:- We find that the assessee has furnished the details of the income tax returns alongwith PAN. It has also been informed that the lenders have given confirmation. Therefore, the assessee has complied with the conditions prescribed in the provisions of Sec. 68 of IT Act. Considering all especially when no adverse remarks ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee to attend the hearing and produce books of account. However, the assessee failed to appear before the Assessing officer and produce books of account. On the basis of documents filed by the assessee like tax audit report, audited financial statement and copy of some ledgers, the Assessing Officer competed assessment u/s.144 of the Act assessing the income at Rs. 89,91,131/- after making disallowances out of expenses aggregating to Rs. 57,23,641/- on adhoc basis and Rs. 18,95,000/- as unsecured loans. 4. The Assessing Officer observed that since the assessee has not produced books of account, he disallowed 10% of the following expenses: 1. Purchase exp. Of material Rs. 20,,69,418/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition on percentage basis. 7. We have heard the submissions of ld D.R., perused the orders of lower authorities and materials available on record. We find the Assessing Officer has made assessment u/s.144 of the Act and made disallowance at 10% of the total receipts, relying on tax audit report and copies of some alleged accounts. The CIT(A) has reported that during remand proceedings, the books of account were not called for verification. The CIT(A) further observed that the net profit shown by the assessee appears to be low. The CIT(A) relied on the decision of the Tribunal in the case of CM Makhija (supra) and directed the Assessing Officer to apply net profit at 3.5% of the total receipts and deleted the disallowance made by the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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