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Income Tax Appellate Tribunal, DIVISION BENCH’A’, CHANDIGARH
Before: SMT. DIVA SINGH & DR. B.R.R. KUMAR
IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH’A’, CHANDIGARH BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND DR. B.R.R. KUMAR, ACCOUNTANT MEMBER ITA No.206/Chd/2017 Assessment Year: 2009-10
Sh. Harish Kumar Bansal Vs. The Addl. CIT SCF 151, Sector 26 Range V Chandigarh Chandigarh
PAN No. AESPB9775P
(Appellant) (Respondent)
Assessee By : Shri. Tej Mohan Singh Revenue By : Smt. Chandrakanta
Date of hearing : 25/07/2018 Date of Pronouncement : 06/08/2018
ORDER PER DR. B.R.R. KUMAR, A.M:
The present appeal has been filed by the Assessee against the order of
the Ld. CIT(A)-2, Chandigarh dt. 18/08/2016.
In the present appeal Assessee has raised following grounds:
That the Ld. CIT(A) has erred in law and facts in upholding the rejection of books of account in utter disregard of the explanation rendered which is illegal arbitrary and unjustified. 2. Without prejudice to the above, the Ld. CIT(A) has further erred in upholding the application of GP rate of 12.5% resulting in an addition of Rs. 9,96,443/- as against 9.35% declared by the assesee in utter disregard of the explanations rendered and as such the addition upheld is illegal, arbitrary and unjustified.
Brief facts on the issue are that a survey was conducted at the business
premises of the assessee on 10/07/2008. As a result of survey excess cash, excess
stock of Rs. 25.23 lacs and other incriminating material was found and to cover
up these discrepancies, the assessee surrendered the same to tax. The Assessing
Officer noted that assessee has shown business loss in the return of income
declaring GP at 9.35% of total sales. On being confronted for low GP, assessee
did not give any satisfactory reasons and for the reasons that the assessee is not
maintaining any stock register, complete bills of purchases and expenses were
not found and failed to produce original bills and vouchers during the course of
assessment proceedings, the Assessing Officer held that books of account of the
assessee are not correct and therefore the income of the assessee was
estimated by applying GP rate of 12.50% on the sales of Rs. 3,18,22,249/- and an
addition of Rs. 9,96,443/- was made.
During the appellate proceedings before the Ld. CIT(A), the assessee filed
additional evidences of valuation and quantitative details of the closing stock
which were forwarded to the Assessing Officer who replied in the remand report
that as per the audit report the assessee is not maintaining stock register and the
quantitative detail submitted as additional evidence have no credibility. Owing
to the reply of the Assessing Officer the Ld. CIT(A) confirmed the addition
determining the profit @12.50 %.
Before us, during the hearing the Ld. AR argued that since it is a case of
estimation of profit from 9.35 % to 12.5% , a reasonable percentage of profit may
be determined. The parties are fairly agreed for determination of profits @10.5%
on the total turnover of the assessee. Hence, the Assessing Officer is hereby
directed to re-compute the profits accordingly.
As a result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open Court.
Sd/- Sd/- (DIVA SINGH) (DR. B.R.R. KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated : 06/08/2018 AG Copy to: 1.The Appellant, 2. The Respondent, 3.The CIT, 4.The CIT(A), 5. The DR