TaxTMI 
TaxTMI 
TaxTMI 
2015 (5) TMI 435
X X X X Extracts X X X X
X X X X Extracts X X X X
.....01.2011, so far as it relates to the dismissal of its appeal and correspondingly the relief granted to the assessee for Assessment Year (AY) 2003-04. Assessments for four years 2002-03 to 2005-06 were made on 29.12.2006 under Section 153A pursuant to a search conducted on 07.10.2004. The Revenue urges that the ITAT fell into error on the following questions:- (i) Disallowance of expenses in the profit & loss account, specifically with respect to transport expenses claimed - only Rs. 3,38,184 /- out of the total claim of Rs. 36,01,764/-, sought to be added was actually allowed by the Assessing Officer (AO); (ii) Deletion of findings with respect to the error in rejection of books and the imposition of 12% GP rate by the AO on account of a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ch the details and records in respect of Rs. 36 Lacs odd was not available. This constituted just about 5.1% of the total transport expenses. The AO had rejected the said claim of expenditure of Rs. 36 Lacs and instead worked out 1.75% of the total expenditure, amounting to Rs. 36,01,764/-, as the admissible figure. The CIT(A) upheld the rejection of books of account but granted limited relief to the extent that the GP rate was reduced from 12% to 11.6%. 4. Aggrieved by the order of the CIT(A), both the Revenue and the assessee carried the matter in appeal. The ITAT by impugned order, analysed the entirety of the material and evidence on record for all the years i.e. AY 2002-03 to 2005-06. It held that the reason for rejection of the books....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or making the payment in cash. In our opinion, this is not such a factor which may prevent the Assessing Officer to compute the true income of the assessee from the accounts..." This Court is of the opinion that the ITAT's reasoning is sound and does not call for interference. The extent of disallowance made towards transportation expenses claimed was Rs. 36,01,764/- which was concededly in cash. Counsel for the Revenue points out that lower questionnaire was sought given to the assessee on 05.04.2006. The reply on this score belatedly on 04.05.2006 did not contain any particular. Be that as the case may be, at the same time, this Court is of the opinion that considering the totality of the expenditure which was about Rs. 7,21,16,088/-, th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the record that how that loose paper is relevant for working out the yield. The yield of the assessee ought to be verified from the factor, what type of rice it had purchased, how it has processed, what type of machinery it has used, those percentage ought to be compared with some similarly situated assessee or with the result of other years. No such steps have been taken by the Assessing Officer. He merely assigned one reason for the sake of giving reasons. 13. Assessing Officer has estimated the GP at 12%. In assessment year 2005-06, assessee itself has shown the GP at 13.14%. In that year, he estimated the GP at 13.5%. It gives an impression that Assessing Officer instead of finding out actual defects in the books of account of the ass....
X X X X Extracts X X X X
X X X X Extracts X X X X
....8. The above findings are again a finding of fact. Revenue's appeal does not in any manner reflect how these findings are unreasonable or unsupported by the materials on record. Consequently, no question of law arises for consideration, as to the rejection of the books of account. 9. In view of the above conclusion, the further finding of the ITAT that the imposing of GP rate of 12% - later reduced to 11.6% was entirely unwarranted. This finding, of course, cannot be disturbed in view of the fact that each of the reasons which impelled the AO to reject the books of account, has been upheld. 10. As far as the interest of Rs. 50,200/-, attributed as a notional interest accruing from other sources is concerned, this Court agrees with the fin....