CIT v. Gotan Lime Khaniz Udyog

Shri Jitendra Kumar Agarwal, Jaipur vs. DCIT, Central Circle-2, Jaipur

In the result, based on the discussion so recorded here in above both

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

…it is submitted that it is not necessary that in all cases where the books of 3accounts of the assessee are rejected, an addition to the returned income has to be made. In this regard, jurisdictional High Court in the case of CIT vs. Gotam Lime Khanij Udhyog 256 ITR 243 (Raj) held that Section 145 of the Income-tax Act, 1961, only provides the basis on which computation of income is to be made for the purpose of determining the amount of tax. The provision by itself does not deal with addition or deletion to the income. Therefore, mere rejection of, or some deficiency in, the books of account would not mean that…

Shri Jitendra Kumar Agarwal, Jaipur vs. DCIT, Central Circle-2, Jaipur

In the result, based on the discussion so recorded here in above both

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

…it is submitted that it is not necessary that in all cases where the books of 3accounts of the assessee are rejected, an addition to the returned income has to be made. In this regard, jurisdictional High Court in the case of CIT vs. Gotam Lime Khanij Udhyog 256 ITR 243 (Raj) held that Section 145 of the Income-tax Act, 1961, only provides the basis on which computation of income is to be made for the purpose of determining the amount of tax. The provision by itself does not deal with addition or deletion to the income. Therefore, mere rejection of, or some deficiency in, the books of account would not mean that…

Basant Gupta, Jaipur vs. Deputy Commissioner of Income Tax, Circle-1, Jaipur

In the result, this appeal of the assessee is partly allowed

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

…s not justified as the addition can be made taking into consideration the past history of the case and current events of the case as held by Hon’ble Rajasthan High Court in case of CIT vs. Inani Marbles Pvt. Ltd., 316 ITR 125 (Raj.) and in case of Gotan Lime, 256 ITR 243. In recent judgment in case of Amrapali Jewels Pvt. Ltd., 65 DTR 196 (Raj.), the Hon’ble Rajasthan High Court has also upheld the view that in case of unverifiable purchases only section 145(3) can be invoked but no addition can be made on the basis of unverifiable purchases as the addition can be made after taking into consideration the past his…

Raj Auto Wheels (P) Ltd., Jaipur vs. ACIT, Ajmer

In the result, the appeal of the assessee is party allowed

…ermitted in the eyes of the law. The AO however, did not conform to its settled requirement. Kindly refer Jotram Shershing vs. CIT 2 ITR 119 (All). 1.2 Addition Need Not Be Made, Even if S.145 of the Act Invoked: In the case of CIT v/s Gotan Lime Khaniz Udyog 256 ITR 243(Raj), it has been held that mere rejection of books of account need not necessarily lead to additions to the returned income. It was also held that the books of account, together with past history of the case as also material collected by the AO should be considered for estimation of income. 2.1 Better Results: It is submitted that the correct a…

M/S Raj Auto Wheels P .Ltd., Ajmer vs. JCIT, Range-1, Ajmer

In the result, the appeal of the assessee is party allowed

…t at all permitted in the eyes of the law. The AO however, did not conform to its settled requirement. Kindly referJotram Shershing vs. CIT 2 ITR 119 (All). 1.2 Addition Need Not Be Made, Even if Sec.145 Invoked: In the case of CIT v/s Gotan Lime Khaniz Udyog 256 ITR 243(Raj), it has been held that mere rejection of books of account need not necessarily lead to additions to the returned income. It was also held that the books of account, together with past history of the case as also material collected by the AO should be considered for estimation of income. 2.Past History-Best Guide: We may submit that past hist…

M/S Silvex & Co. (India) Ltd., Jaipur vs. Income Tax Officer, Ward-7-2, Jaipur

In the result, the appeals are partly allowed

…eclared by the assessee deserve to be accepted. But the ld. AO without appreciating these facts made the addition of RS. 57,05,309/- by applying such a high G P rate at 6.71%. Hon’ble Rajasthan High Court in the case of M/s Gotan Lime Khanij Udyog reported in 256 ITR 243” has held that rejection of books of accounts need not necessarily lead to any addition to the income. The AO has rejected the books of accounts u/s 145(3) of the Income Tax Act, 1961 merely on the basis of alleged defects in maintenance of stock register and presentation mismatch in balance sheet and profit & loss account with previous years fig…

M/S Silvex & Co. (India) Ltd., Jaipur vs. Income Tax Officer, Ward-7-2, Jaipur

In the result, the appeals are partly allowed

…eclared by the assessee deserve to be accepted. But the ld. AO without appreciating these facts made the addition of RS. 57,05,309/- by applying such a high G P rate at 6.71%. Hon’ble Rajasthan High Court in the case of M/s Gotan Lime Khanij Udyog reported in 256 ITR 243” has held that rejection of books of accounts need not necessarily lead to any addition to the income. The AO has rejected the books of accounts u/s 145(3) of the Income Tax Act, 1961 merely on the basis of alleged defects in maintenance of stock register and presentation mismatch in balance sheet and profit & loss account with previous years fig…

Shri Manoj Amar Chand Tailor, Masuda Bijainagar vs. Income Tax Officer, Ward-1, Beawar

In the result, the appeal filed by the Revenue is dismissed

…Thus, rejection is illegal. 2.6. Without agreeing, it is submitted that even if books of accounts are rejected, it is not mandatory to make additions. Reliance is placed on the decision Hon’ble Rajasthan High Court in case of CIT vs. Gotan Line Khanji Udyog 256 ITR 243 2.7. It is further submitted that where receipts and payments are through banking channels and the transactions are supported with documents which appear to be genuine and where no trail of cash has been established addition/disallowance cannot be made. The assessee’s case is squarely covered by the decision of Hon’ble Rajasthan High Court in ca…

Income Tax Officer, Ward-1, Beawar vs. Shri Manoj Amar Chand Tailor, Masuda Bijainagar

In the result, the appeal filed by the Revenue is dismissed

…Thus, rejection is illegal. 2.6. Without agreeing, it is submitted that even if books of accounts are rejected, it is not mandatory to make additions. Reliance is placed on the decision Hon’ble Rajasthan High Court in case of CIT vs. Gotan Line Khanji Udyog 256 ITR 243 2.7. It is further submitted that where receipts and payments are through banking channels and the transactions are supported with documents which appear to be genuine and where no trail of cash has been established addition/disallowance cannot be made. The assessee’s case is squarely covered by the decision of Hon’ble Rajasthan High Court in ca…

Income Tax Officer, Ward-1-2, Ajmer vs. Shri Bhagchand Jain, Ajmer

In the result, appeal of the Revenue is dismissed and the cross objection of the assessee is partly allowed

…all permitted in the eyes of the law. The ld. AO however did not confirm to its settled requirement. Kindly refer Jotram Shershing vs. CIT 2 ITR 119 (All). 3.2 Addition Need Not Be Made, even if Sec.145 Invoked: In the case of CIT v/s Gotan Lime Khaniz Udyog 256 ITR 243 (Raj), it has been held that mere rejection of books of accounts need not necessarily lead to additions to the returned income. It was also held that the books of account, together with past history of the case as also material collected by the AO (of course, after confronting the appellant) should be considered for estimation of income. Also ref…

Shri Mohan Lal Bargoti, Jaipur vs. Assistant Commissioner of Income Tax, Circle-4, Jaipur

In the result, this appeal of the assessee is allowed

Bench: Shri Sandeep Gosain, Jm & Shri Vikram Singh Yadav, Am Vk;Dj Vihy La-@Ita No. 1462/Jp/2018 Fu/Kzkj.K O"Kz@Assessment Year :2013-14 Shri Mohan Lal Bargoti, Cuke A.C.I.T. Vs. 1-A-1, 1-A-2, Subhash Colony, Circle-4, Shastri Nagar, Jaipur. Jaipur Lfkk;H Ys[Kk La-@Thvkbzvkj La-@Pan/Gir No.: Abzpb 7893 C Appellant Respondent Fu/Kzkfjrh Dh Vksj Ls@ Assessee By: Shri S.L. Poddar (Adv) Jktlo Dh Vksj Ls@ Revenue By: Smt. Runi Pal (Addl.Cit) Lquokbz Dh Rkjh[K@ Date Of Hearing : 18/06/2021 Mn?Kks"K.Kk Dh Rkjh[K@ Date Of Pronouncement : 30/07/2021 Vkns'K@ Order Per: Sandeep Gosain, J.M. This Is The Appeal Filed By The Assessee Against The Order Of The Ld. Cit(A), Ajmer Dated 14/11/2018 For The A.Y. 2013-14. The Grounds Taken By The Assessee Are As Under:

…rivial matters. He has relied on the following judicial pronouncements: i. Pandit Bros. V. CIT, (1954) 26 ITR 159 (Punjab); ii. S. Veeriah Reddiar V. CIT, (1960) 38 ITR 152 (Kerala); iii. M. Durai Raj V. CIT, (1972) 83 ITR 484 (Kerala). iv. CIT Vs. Gotan Lime 256 ITR 243 (Rajasthan) v. Vishal Infrastructure Ltd. Assessment CIT [2007] 11 SOT 386/104 ITD 537(Hyd.). vi. Narsing Das Ram Kisan Vs. ACIT 272 ITR 467 The ld AR has further submitted that even if books of accounts are rejected on one or the other ground, this in itself does not give a license to the ld. 5 ITA 1462/JP/2018 _ Shri Mohan Lal Bargoti Vs ACIT…

Assistant Commissioner of Income Tax, Circle-1, Kota vs. Shiv Edibles Ltd., Kota

In the result, appeal of the Revenue is dismissed

Bench: Us.

…t estimation of income keeping in view the material available on record, local knowledge and repute of the assessee. In support of his contention, he has relied upon the decision of Hon’ble Jurisdictional High Court in case of CIT vs. Gotan Lime Khaniz Udyog, 256 ITR 243 (Raj.). Thus the ld. A/R has submitted that mere rejection of books of account need not necessarily lead to addition to the returned income. The ld. A/R has further contended that there are various reasons for declaring low GP as it has been consistently declining for last few years due to the market conditions and fluctuations of price of raw ma…

ACIT, Central Circle-3, Jaipur vs. M/S. Lakhi Gems, Jaipur

In the result, ground of appeal taken by the Revenue as well as that of the assessee is hereby dismissed

…008) 16 DTR 278 dt.24.10.2008 (Raj.) (HC) • CIT Vs. Inani Marbles Pvt Ltd. 316 ITR 125 (Raj.) (HC) • Kansara Bearings P. Ltd Vs. ACIT 270 ITR 235 (Raj) • Malani Ramjivan Jagannath Vs. ACIT 207 CTR (Raj.)19: It was held that:- • CIT Vs. Gotan Lime Khaniz Udyog 256 ITR 243(Raj) 6 ITA No. 1306/JP/2019 & CO No. 04/JP/2020 ACIT, Jaipur Vs. M/s Lakhi Gems, Jaipur In view of the above the trading addition of Rs. 7,02,120/- made by the AO is uncalled for and has been rightly deleted by the ld CIT(A). He accordingly supported the findings of the ld CIT(A). 6. Regarding Ground No. 2 of the Revenue’s appeal & Ground no.…

M/S. G.B.Impex, Jaipur vs. ITO, Ward-6(3), Jaipur

In the result, the appeal of the assessee is dismissed

…liance was placed on the following cases:- • Shankar Export Vs. ACIT 42 DTR 441 dt. 01.06.2010(Jpr.) • CIT Vs. Smt. Poonam Rani 41 DTR 194 (Del) • Malani Ramjivan Jagannath Vs. ACIT 207 CTR 19 (Raj.) 8 M/s G.B. Impex vs. ITO • CIT Vs Gotan Lime Khaniz Udhyog 256 ITR 243 (Raj.) 8. Per contra, the ld. DR relied on the finding of the lower authorities and our reference was drawn to the findings of the ld. CIT(A) which are contained at para 4.3 of his order which reads as under:- “4.2 I have considered the facts of the case, assessment order, documents on record and appellant's submissions. The AO noted that the a…

Shri Manoj Kumar Johari, Sikar vs. Assistant Commissioner of Income Tax, Circle, Sikar

In the result, this appeal of the assessee is dismissed

Bench: Shri Sandeep Gosain, Jm & Shri Vikram Singh Yadav, Am Vk;Dj Vihy La-@Ita No. 535/Jp/2018 Fu/Kzkj.K O"Kz@Assessment Year: 2013-14 Manoj Kumar Johari, Cuke A.C.I.T. Vs. Prop. Of The Art Palace, Zee Circle-Sikar. Bhawan, Subhash Chowk, Ramgarh-Shekhawati, Sikar. Lfkk;H Ys[Kk La-@Thvkbzvkj La-@Pan/Gir No.: Adwpj 8870 A Vihykfkhz@Appellant Izr;Fkhz@Respondent Fu/Kzkfjrh Dh Vksj Ls@ Assessee By : Shri Vikash Rajvanshi (Ca) Jktlo Dh Vksj Ls@ Revenue By: Shri A.S. Nehra (Addl.Cit) Lquokbz Dh Rkjh[K@ Date Of Hearing : 17/12/2020 Mn?Kks"K.Kk Dh Rkjh[K@ Date Of Pronouncement : 12/03/2021 Vkns'K@ Order Per: Sandeep Gosain, J.M. This Appeal Has Been Filed By The Assessee Against The Order Of The Ld. Cit(A)-3, Jaipur Dated 16/02/2018 For The A.Y. 2013-14, Wherein Following Grounds Have Been Taken: “1. Ld. Cit(A) Has Erred In Law & Fact In Estimating 12.86% Gp Rate On The Basis Of 5 Year’S Average Assessed Gp Rate & Sustained Gp Addition Of Rs. 20,43,900/- Without Considering Actual Gp & Even Not Considering The Actual Average Of Last 5 Year Gp. 2. The Appellant Prays Your Honor To Add, Amend Or Alter All Or Any Of The Grounds Of The Appeal On Or Before The Date Of Hearing.”

…hat AO cannot resort to provisions of the section 145(3) of the IT Act,1961, in case of non maintenance of stock register and other issues as already decided in many cases but G.P. addition can not be made, such as : A. CIT Vs Gotan Lime Khaniz Udhyog (2002) 256 ITR 243 (Rajasthan High Court). The assessee had maintained regular books of account, which are supported by regular bills and vouchers, and no defect or discrepancy had been observed by the learned assessing officer in the records so maintained. The sales are also export where payments are fully verifiable and through banking channels. Unless the regul…

Shri Sunder Das Sonkia, Jaipur vs. ITO, Ward 1(2), Jaipur

In the result, the appeal of the assessee is allowed partly and the appeal of the Revenue is dismissed

Bench: Shri Sandeep Gosain, Jm & Shri Vikram Singh Yadav, Am Vk;Dj Vihy La-@Ita No. 1383/Jp/2019 Assessment Year: 2010-11 Shri Sunder Das Sonkia, Cuke I.T.O., Vs. Sonkia Bhawan, Sms, Highway, Ward-1(2), Jaipur. Jaipur. Pan No.: Akhps 7413 G Vihykfkhz@Appellant Izr;Fkhz@Respondent Vk;Dj Vihy La-@Ita No. 09/Jp/2020 Assessment Year: 2010-11 I.T.O., Cuke Shri Sunder Das Sonkhiya, Vs. Ward-1(2), Prop.- M/S Naveen Jewellers, Jaipur. Sonkhiya Bhawan, Chaura Rasta, Jaipur. Pan No.: Akhps 7413 G Vihykfkhz@Appellant Izr;Fkhz@Respondent Fu/Kzkfjrh Dh Vksj Ls@ Assessee By : Shri S.R. Sharma (Ca) & Shri Rajnikant Bhatra (Ca) Jktlo Dh Vksj Ls@ Revenue By : Smt. Rooni Paul (Addl.Cit) Lquokbz Dh Rkjh[K@ Date Of Hearing : 02/12/2020 Mn?Kks"K.Kk Dh Rkjh[K@ Date Of Pronouncement : 18/01/2021 Vkns'K@ Order Per: Sandeep Gosain, J.M. These Are The Appeal Filed By The Assessee & The Cross Appeal Filed By The Revenue Arise Against The Order Of The Ld. Cit(A)-4, Jaipur Dated 08/11/2019 For The A.Y. 2010-11. The Grounds Taken By The Assessee & The Revenue Are As Under:

…e the books of accounts have been rejected, there is no basis for making trading addition in the hands of the assessee. In this regard, reference can be drawn to the decision of Hon’ble of Rajasthan High Court in case of CIT vs Gotan Lime Khanij Udhyog (2002) 256 ITR 243 wherein it was held as under: “3. We have perused the statement of case and the finding recorded by the Tribunal in the light of observations made in the statement of case and heard the learned counsel. Section 145 as it stood at the relevant time, reads as under : "145. Method of accounting.—(1) Income chargeable under the head ‘Profits and gain…

Daksh Jewellery Pvt. Ltd., Jaipur vs. Income Tax Officer, Ward-5-2, Jaipur

In the result, appeal of the assessee is disposed off in light of aforesaid directions

…nt i.e. opening stock, purchases, sales and closing stock are accepted and no specific defect has been pointed out by the ld. CIT(A). Further, reliance was placed on the Hon’ble Rajasthan High Court’s decision in case of Gotan Lime Khanij Udyog vs. CIT (2002) 256 ITR 243 and Malani Ramjivan Jagannath vs. ACIT (2009) 316 ITR 120. It was accordingly submitted that the action of rejecting the books of accounts and invoking the provisions of section 145(3) simply for the two purchases by the ld. CIT(A) thus may be quashed and trading addition so confirmed be ordered to be deleted. 6. Per contra, ld. DR is heard who…