TaxTMI 
TaxTMI 
2006 (11) TMI 269
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....vey he surrendered a sum of Rs. 1,35,000 for asst. yr. 2001-02, as his additional income. He also deposited advance tax of Rs. 40,000 on this amount on 15th March, 200l. 3. On examination of patient's register, it was found that the assessee mentioned only the name and prescription along with the fees charged from a patient. Complete addresses of the patients were not given. No receipts were, allegedly, being given to the patients for the fee received from them, nor their signatures were obtained. He did not maintain stock register for medicines. He maintained only computerized ledger. Closing stock was prepared on approximate basis. The AO in this background rejected the books of the assessee and applied the provisions of s. 145(1) for estimating his income. The AO made estimation of receipts from patients. The AO estimated number of patients per day at 55 and, receipt from each patient at Rs. 30, to arrive at the income of the assessee from seeing of patients. The AO also estimated receipt on account of consultation charges. 4. The explanation of the assessee is that according to the certificate issued by the Rajasthan Ayurvedic Chikitsak Sangh (P) Regd., Sriganganagar, mem....
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....2,771 and calculated profit by applying the rate of 40 per cent, as stated by the assessee, himself, which came to Rs. 80,000. Thus, the addition was reduced to Rs. 95,967 from an addition of Rs. 2,47,707 (Rs. 1,31,217 + Rs. 1,16,490), made by the AO. The assessee is further aggrieved. 7. We have heard the rival submissions and perused the evidence on record. 8. Without mentioning in so many words, we uphold the rejection of the books of account and the application of the provisions of s. 145(1) of the Act. The statements of the assessee himself, recorded during survey coupled with the fact of surrender by the assessee, justifies this action of the AO, particularly, when no proper registers of accounts are maintained. The learned CIT(A) has meticulously examined each detail, be it the estimation of patients receipts or the profit element from the sale of medicines. But only argument of the learned Authorised Representative, which seems to be somewhat considerable is that the assessee being an ayurvedic practitioner, does not charge consultancy fees but whatever profit, at the rate of 40 per cent he charges on the sale of medicines is his only gross receipt. The certificate is....
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....bsp; Rs. 1,500 per month Shri Ram Kumar [compounder] Rs. 1,000 per month Shri Ram Dutt Rs. 1,000 per month 11. On this basis, the AO made an addition of Rs. 12,000 on account of unrecorded salary of Shri Ram Kumar and Rs. 3,000 on account of salary paid over and above recorded in the books to Shri Ram Dutt and made an addition of Rs. 15,000 being undisclosed income of the assessee. The assessee did not mention the name of this employee and did not disclose salary. The assessee explained that instead of Ram Kumar, the assessee wrongly mentioned the name as Vinod Kumar. According to the assessee Shri Vinod Kumar had never worked with him. But still the AO held the salary of Rs. 12,000 was paid from undisclosed sources. 12. We have heard the rival submissions and perused the evidence on record. 13. It has been submitted before us that the assessee has disclosed every fact truly. The name of Shri Ram Dutt was wrongly written. Actually only 3 employees were with him. The payment of salary was made on cash basis. It was also submitted the learned AO has not obj....
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....s not been disproved. Therefore, in our considered opinion salary paid to her has to be allowed. The salary of Rs. 2,500 per month cannot be said to be on the higher side even. 17. Ground No. (7) relates to an addition of Rs. 8,400 made on account of rental income. The learned Authorised Representative has straightway prayed that 1/3rd deduction should be allowed as per law from the rental income. This being justified claim, we allow 1/3rd deduction out of Rs. 8,400 towards maintenance, etc. and sustain the remaining amount. 18. In ground No. (8) read as under: "That the learned AO has erred in not giving the credit of Rs. 1,35,000 surrendered by the assessee at the time of survey and the learned CIT(A) has further erred in not giving any finding about the adjustment." 19. This issue is stated to be covered by a decision of this Bench given in the case of Sushil Kumar & Brothers vs. ITO in ITA No. 663/Jd/2004 (asst. yr. 2000-01) order dt. 1st May, 2005 (a copy of which has been filed on record). 20. We have heard the rival submissions and perused the evidence on record. 21. At p. 23 of paper book p. 5 of letter dt. 9th March, 2001 is placed. The last but one para ....