TaxTMI 
TaxTMI 
2014 (7) TMI 769
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....m time to time by the central excise authorities. For the assessment year 1986-87, the Assessing Officer rejected the books of account and assessed the income at Rs. 42,21,498/-. The assessee, being aggrieved, filed an appeal, which was allowed by an order dated 29th March, 1993 and the assessment order was set aside with a direction to the Assessing Officer to decide the matter afresh. Based on the said direction, the Assessing Officer passed a fresh order under Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act) dated 29th February, 1996 again rejecting the books of account under Section 145(2) of the Act. The Assessing Officer noticed that the gross profit of rate shown for the year in question by the asses....
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.... a later date. The assessee, being aggrieved, filed an appeal, which was allowed by an order dated 12th April, 1996 deleting the addition of Rs. 6,05,481/-. The appellate authority deleted the addition on the reasoning that in the immediately preceding assessment year, the gross profit rate disclosed was 7.95%, which was virtually accepted by the appellate authority in that year in which various additions made on account of excess consumptions of tobacco leafs, craft papers, labels, gunny bags were deleted. On that reasoning, the appellate authority found that there was no reason to sustain the addition made by the Assessing Officer for the year in question on the same basis. The revenue, being aggrieved by the order of the Commission....
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...., the books of account has been rejected by the Assessing Authority, which was affirmed by the appellate authority. Once the books of accounts are rejected, the turnover has to be estimated and, while estimating the turnover, the past record of the assessee, his method of accounting and his general reputation in the market becomes relevant. One such commercial practice to determine the turnover of a particular year is, to take into account the stock position of the raw material. In P. Venkanna Vs. Commissioner of Income Tax, Mysore, 1969 (72) ITR 328 it was held that profits estimated during earlier period may in a proper case guide the estimation of a profit of a subsequent year. It was held that the earlier estimates will have relevanc....
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....n of the books of accounts as well as the defects pointed out by the Assessing Officer with regard to non maintenance of the stock registers of various raw materials consumed by the assessee for its manufacturing activities. However, the CIT was swayed by the fact that the gross profit turnover for the immediately preceding assessment year was 7.95% and, in that assessment year, the appellate authority had also deleted the additions on account of excess consumption of tobacco leafs, craft papers etc. In that scenario, the appellate authority found that the gross profit rate shown by the assessee at 9.46% was justified. We are unable to subscribe with this view, inasmuch as the appellate authority has no where held that the defects pointe....
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....activity vis-a-vis the turnover of the assessee. Normally, the Tribunal being the last fact finding authority is required to give its own reason howsoever brief it may be. The Tribunal is under a legal obligation to record its own finding on the submissions of the parties and where the order of the Tribunal does not contain any reason, in that case, such an order could not be allowed to stand as there would be no order in the eyes of law. In the instant case, we find that the Tribunal has considered the submissions of both the parties and considered the findings of the Assessing Authority as well as the order of the appellate authority and thereafter, concluded that the Assessing Officer's order was based on reasoning in taking th....