M/S. JAMADAR BRICKS MFG.CO.,BHARUCH vs. THE INCOME TAX OFFICER,WARD-1, BHARUCH

ITA 98/AHD/2013Status: DisposedITAT Surat16 November 2018AY 2008-093 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal found that while the rejection of books was justified due to the lack of a stock register, the AO's estimation of gross profit at 25% lacked a proper basis. Therefore, the Tribunal reduced the estimated gross profit rate to 20%.

What were the facts?

The Assessing Officer (AO) rejected the assessee's books of accounts for not maintaining a day-to-day stock register for brick manufacturing. Consequently, the AO estimated the gross profit at 25% of the turnover, leading to an addition to the income.

What were the issues?

Whether the AO was justified in rejecting the books of accounts and estimating the gross profit rate without proper basis. The quantum of estimation of gross profit in the absence of quantitative details.

Which sections of the Income-tax Act were involved?

Section 145(3),Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘’SURAT’’ BENCH, SURAT

Before: SHRI RAJPAL YADAV & SHRI AMARJIT SINGH

For Appellant: Shri B.T. Thakkar, C.A :
Hearing: 14/11/2018Pronounced: 16/11/2018

PER AMARJIT SINGH, ACCOUNTANT MEMBER:

This assessee’s appeal for A.Y. 2008-2009, arises from the order of the Learned Commissioner of Income Tax (Appeals)-IV, Baroda, dated 18/10/2012 in proceedings under section 143(3) of the Income Tax Act, 1961; in short ‘’the Act’’.

2.

The solitary ground of assessee is regarding addition of Rs.7,46,951/- made on account of low gross profit.

3.

Briefly stated fact of the case is that return of income declaring income of Rs.4,93,883/- was filed on 17/09/2008. Subsequently, the case was selected for scrutiny by issuing notice u/s.143(2) of the Act, on 28/09/2009

The order continues below.

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