1983 (7) TMI 106

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....g to the addition of Rs. 6,000 to the trading result by application of proviso to s. 145(1) was pressed before us. 2. The assessee is a partnership firm dealing in new bicycles and bicycle spare parts and accessories. It had disclosed a GP of 12.61% on gross sales of Rs. 14,82,590 for the asst. yr. 1976-77. On scrutiny of accounts the ITO found that the appellant does not do any stock taking at....

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....ansactions but are the product of an arithmetical exercise. He held that there was no reason why the assessee, whose major turnover involves purchase and sale of bicycles, should not have maintained a proper physical check on the stock so as to account for the correct closing stock. Then adverting to the assessee's effort to explain the low margin of profit on sales of new bicycles with reference ....

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....an ad hoc addition of Rs. 6,000 to the trading results when the GP disclosed on a total turnover exceeding Rs. 14,83,000 is at 12.6% whereas in the cases of other dealers in bicycles and accessories in Bhopal the rate of G.P. of 9.5% is generally accepted. 5. The departmental representative Shri Shyamlal, on his part, relied on the orders of the ITO and the CIT (A). 6. We have considered the....