ASHOK SHARMA,KOLKATA vs. ITO, WARD-40(4), KOLKATA

The facts in brief are that this is second round of litigation before the Tribunal. During the first round the appeal was restored to the file of the ld. AO with a direction that the income of the assessee may be estimated by taking into account the GP rate at 18.82% in para no.3 of the appellate order in ITA No. 1378/KOL/2016 for A.Y. 2010-11 vide order dated 03.05.2019. Accordingly, the ld. AO applied the said GP rate on the total turnover and added ₹43,28,864/- to the income of the assessee by applying the GP rate at 18.82% on the turnover of ₹2,30,01,402/- without making any allowance towards expenses incurred by the assessee. 05. The ld. CIT (A) simply affirmed the said addition by upholding the order of ld. AO when the assessee did not make any submission before the ld. CIT (A). 06. After hearing the rival contentions and perusing the materials available on record, we find from the perusal of the trading and Profit and Loss account for the year ended 31.03.2010, that the expenses incurred by the assessee have not been allowed from the gross profit computed by the AO as per direction of the Tribunal. The total expenses were ₹66,07,286/- and after taking the credit of service tax in the profit and loss account of ₹28,62,240/-, the net profit worked out to 3,26,859/-. In our opinion, the credit has to be allowed for the expenses incurred by the assessee from the gross profit determined by the AO as per tribunal direction. For ready reference the profit and loss account is extracted below:- CLIFFORD FACILITY SERVICES Prof:- Col. Ashok Sharma (Retd). PAN No. AKJPS0470K Recusted as per direction order dt. 03.05.2019 Trading Account for the year ended 31.03.2010 Ashok Sharma; A.Y. 2010-11

The issue raised in ground no.7, is against the confirmation of addition of ₹15,82,148/- by ld. CIT (A) as made by the ld. AO on account of cash deposited in the bank by treating the same as unexplained cash credit. 09. The facts in brief are that the assessee has made a huge deposits into and withdrawals from the bank account which according to the ld. AO were not reconciled and he accordingly added Rs.15,82,148/- to the income of the assessee as unexplained cash credit. However, on the other hands, we note that the assessee has deposited and withdrawn the money from the same bank account and these were repeated transactions done by the assessee and all are reported in the books of accounts maintained by the assessee for the business purposes. Moreover, the addition made by the ld. AO on account of deposits and withdrawals of money and any discrepancy therein cannot be made where the income has been estimated by apply the GP rate. Therefore, we set aside the order of the ld. CIT (A) and direct the ld. AO to delete the addition. The ground raised by the assessee is allowed. 010. Similarly, in ground no.8, the ld. CIT (A) confirmed the addition of ₹8,40,000/- as made by the ld. AO on account of loan and advances treating the same as income from undisclosed sources. Since, we have decided ground no.7, where the income has been estimated by applying the GP rate no additions was called for. Accordingly, we set aside the order of ld. CIT (A) and direct the ld. AO to delete the addition. The ground is accordingly allowed. 011. The issue in ground no.9 is addition of ₹1,87,488/- on account of interest deposit. Ashok Sharma; A.Y. 2010-11

After hearing the rival contentions and perusing the materials available on record, we find that the said interest represented the interest accrued on FDR with UCO bank. Therefore, the same was correctly added by the ld. AO in the assessment order and sustained by the ld. Commissioner of Income-tax (Appeals). Accordingly, we upheld the order of ld. CIT (A) on this issue by dismissing the ground no.9 of the assessee. 013. Ground no.10,11,12,13, are general in nature and do not require any adjudication. 014. In the result, the appeal of the assessee is partly allowed. Order pronounced in the open court on 01.04.2025. (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER)

The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER,//