KRISHNAMOORTHY HARIBHASKAR, TIRUPUR vs. ITO, WARD 2(1). TIRUPUR, TIRUPUR

Aforesaid appeal by assessee for Assessment Year (AY) 2014-15 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 25-10-2023 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s.147 r.w.s 144B of the Act on 30-03-2022. The sole grievance of the assessee is confirmation of certain estimated additions.

From case records, it emerges that the assessee’s return of income was subjected to scrutiny to verify cash deposited by him in his bank account as maintained with Indusind Bank Ltd. The assessee was a non- filer and accordingly, the case was reopened and notice u/s 148 was issued on 27-03-2021. It transpired that the assessee was sole proprietor of 4 concerns wherein the assessee was carrying out trading of yarn. The assessee admitted income on estimated basis @1% of total deposits since it did not maintain any books of accounts for this year. The Ld. AO, upon perusal of bank statements, concurred that the assessee was carrying out certain business activity. However, Ld. AO did not accept the estimation of the assessee and estimated the income @6% of total credits and added the differential to the income of the assessee.

The Ld. CIT(A) dismissed the legal ground of the assessee and held that approval u/s 151 was sanctioned by competent authority after due consideration of statutory provisions. The Ld. CIT(A) also confirmed the estimation made by Ld. AO. Aggrieved, the assessee is in further appeal before us. 4. From the facts, it emerges that the assessee has not maintained any book of accounts. It is admitted fact that the assessee has carried out certain business during the year. However, the estimation of 1% as offered by the assessee was without any sound basis. At the same time, the estimation of 6% as made by Ld. AO is also on vague estimation without any logic or reasoning. Left with no option and with a view to settle the litigation, we direct Ld. AO to estimate the income of 3%. The legal grounds has rightly been adjudicated by Ld. CIT(A) and no interference is required in the same.