Tribunal rules in favor of assessee, rejects unjustified trading addition, and admits Cross Objection.

The Tribunal ruled in favor of the assessee by accepting the condonation of delay in filing the Cross Objection and admitting it for consideration. Regarding the dispute over the trading addition in assessment, the Tribunal found the addition made by the CIT(A) unjustified as there were no specific leakages or shortcomings in the net profit, ultimately deleting the addition and dismissing the Department's appeal while allowing the assessee's Cross Objection.

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Issues:
- Condonation of delay in filing Cross Objection
- Dispute over trading addition in assessment

Condonation of Delay in Filing Cross Objection:
The appeal involved a dispute regarding the belated filing of a Cross Objection against an order dated 01/08/2012 of the learned CIT(A)-III, Jaipur. The assessee filed an application for condonation of delay, stating that the cross objection was filed promptly upon receiving the grounds of appeal in Form No. 36 from the Department. The Tribunal accepted the contention of the assessee that there was no delay in filing the Cross Objection and admitted it for consideration.

Dispute over Trading Addition in Assessment:
The core issue in the appeal was the trading addition made by the Assessing Officer based on the rejection of the assessee's books of account under section 145(3) of the Act. The Assessing Officer applied a net profit rate of 9% on the turnover declared by the assessee without providing a basis for the same. The CIT(A) sustained an ad hoc addition of Rs.2,00,000/- despite acknowledging that no trading addition could be made when the net profit rate declared by the assessee was better than the previous year. The Tribunal observed that the addition sustained by the CIT(A) was not justified as there were no specific leakages or shortcomings in the net profit. Therefore, the Tribunal deleted the addition and dismissed the Department's appeal while allowing the assessee's Cross Objection.

In conclusion, the Tribunal's judgment addressed the issues of delay in filing the Cross Objection and the dispute over the trading addition in the assessment, ultimately ruling in favor of the assessee by deleting the addition made by the CIT(A) and allowing the Cross Objection.

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