9911796707
TMI Blog2018 (3) TMI 2037X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.36,31,910/- u/s 69A of the Income Tax Act, 1961, made by the Assessing Officer on account of difference in turnover, without appreciating the fact that the Assessing Officer has made addition after necessary examination of the issue as per facts available on record in accordance with law, which have been discussed elaborately in assessment order. 2. That on the facts and in the circumstances of the case, Ld. CIT (A) has erred in deleting the addition of Rs.5,00,000/- made by the Assessing Officer on account of undisclosed income from the commission, without appreciating the fact that the addition was made by the Assessing Officer on the basis of the amount surrendered by the assessee during the search operation. 3. That the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the AO has wrongly assumed that current year G.P. rate is 3.7% whereas in fact he has himself accepted the current year G.P. rate at 1.91% and thus the addition is wholly based on notions conjecture surmises without and concrete evidence and is liable to be deleted. 5. The Ld. CIT(A)'s further erred on facts and in law in confirming the additions to the extent of Rs. 4500000/- being claimed on account of expenses deemed to have been incurred in earning the commission income of Rs. 59500000.00 during the year under consideration. 6. In confirming the addition of Rs. 4500000.00 the Ld. CIT(A) chosen to ignore the fact that this was the gross receipt from the commission and thus expenses under this head for earning this income have t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer observed that in the return of income the assessee had declared only Rs. 5.5 crore as commission income and remaining amount has been claimed as expenses to earn the undisclosed commission of Rs. 6,00,00,000/-. The Assessing Officer made the addition of balance amount of Rs. 50,00,000/- in view of no evidence for the expenses. 4.2 Aggrieved with the order the assessee filed appeal before learned CIT(A) and filed detailed submissions. Learned CIT(A) though upheld the gross profit rate of 3.7% applied by the Assessing Officer however, the Assessing Officer reduced the amount of undisclosed turnover by finding difference in the figures. The learned CIT(A) on the reduced undisclosed turnover applied gross profit rate of 3.7% and allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sold and which the Assessing Officer had accepted. It was submitted that if the current year's gross profit rate of 1.91% is applied to the unaccounted turnover, no addition would have been made. It was submitted that the authorities below should have considered the arguments of the assessee in not applying gross profit rate of earlier year when the gross profit rate of present year was available and which was accepted. 5.1 As regards the expenses of Rs. 50,00,000/- which the assessee had claimed to have incurred to earn income of Rs. 6,00,00,000/-, Learned A. R. stated that no income can be earned unless some expenditure is incurred to earn that income and against the income of Rs. 6,00,00,000/-, Rs. 50,00,000/- claimed to have been incu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the turnover of Ghee from 01/04/2002 to 23/01/2003 was Rs. 1,46,03,09,941/- out of which the turnover as per audited books of account upto 23/01/2013 was Rs. 37,15,41,587/- which should have been reduced to arrive at the unaccounted turnover. However, the Assessing Officer had reduced only an amount of Rs. 27,33,82,332/- as recorded turnover which was not correct and learned CIT(A) has rightly taken up the correct figure to arrive at the figure of unaccounted turnover. Learned A. R. further submitted that figure in the audited account for recorded turnover was supported by VAT returns also and therefore, there is nothing wrong in the order of learned CIT(A). 6.4 As regards the other relief of Rs. 5,00,000/- Learned A. R. stated that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profit rate of 3.7% and 1.91% should have been applied to the unaccounted turnover. The average gross profit rate of these two years comes out at 2.8%. Therefore, the Assessing Officer is directed to apply gross profit rate of 2.8% on the unaccounted turnover as calculated by learned CIT(A) which after relief given by learned CIT(A) comes out at Rs. 1,08,87,67,854/-. Out of the gross profit thus arrived the assessee will be allowed deduction on account of expenses to the extent of Rs. 7,73,600/- which learned CIT(A) has also given and out of such net profit the profit declared by the assessee to the tune of Rs. 2.35 crore will be reduced and remaining amount is liable to be taxed in the hands of the assessee. In view of the above ground No ..... X X X X Extracts X X X X X X X X Extracts X X X X
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