Tribunal upholds CIT(A)'s 3% profit estimation for liquor retail trade

The Tribunal dismissed both appeals of the Revenue, upholding the CIT(A)'s orders to estimate the net profit at 3% of purchases or stock put for sale during the relevant years for the assessment of profit in a liquor retail trade business. The decision was based on previous rulings, rejecting the Revenue's grounds and confirming the approach taken by the CIT(A) in ensuring assessed income is not lower than the returned income.

---

---

Issues involved: The judgment involves the estimation of profit of the assessees from the business of retail trade in liquor for the assessment years 2007-08 and 2008-09.

Estimation of Profit: The assessing officer found that the assessees were unable to produce evidence for their turnover in the form of sale bills. The assessing officer computed the turnover by adopting profit margins of 30% for one assessee and 27% for another, adding the difference to the income of the assessee as suppressed turnover. On appeal, the CIT(A) directed the assessing officer to estimate the net profit at 3% of the purchases or stock put for sale during the year, ensuring the assessed income is not less than the returned income. The Revenue appealed against the CIT(A)'s orders, but the Tribunal upheld the decision based on previous rulings, confirming the CIT(A)'s orders and rejecting the Revenue's grounds in both appeals.

Decision: The Tribunal dismissed both appeals of the Revenue, affirming the CIT(A)'s orders based on consistent rulings and confirming the estimation of profit at 3% of purchases or stock put for sale during the year.

---