TaxTMI 
TaxTMI 
2016 (4) TMI 658
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....facts on record. As such the addition of Rs. 12,13,920/- in trading results due to estimation of G.P rate deserves to be quashed. The appellant therefore request to delete this addition. 3. That on facts and circumstances of the case and in law the ld. CIT (A) has failed to appreciate the very important fact that assessee has changed the line of business production and turnover has increased from 1.29 crore to 6.04 crore. The rate of GP as estimated by the ld. CIT (A) on the basis of past years performance is totally illegal and addition deserves to be quashed. 4. That the ld. CIT (A) has grossly erred in directing that expenses of Conveyance, Deepawali, General Telephone Transport and Car expenses should be disallowed to 5% since the GP rate has been estimated, hence in the circumstances disallowance of expenses is totally unjustified and deserves to be quashed. 5. That the order of the ld. AO is bad in law and deserves to be quashed. 2. Brief facts of the case are that the assessee is a proprietor of M/s. Affairs India, Jaipur, and is engaged in the business of sale of clothes. The assessee has filed the return on 29.09.2009 declaring total income of Rs. 3,90,444/- for the....
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.... hence unable to produce before you. On previous hearing, we have already filed copy of account appearing in our books of above said parties alongwith complete address and evidences in support of sale. Inspite of our repeated request they are not issuing the copy of account, kindly ask them directly to file copy of account in your office. We further submit that above said account holders is purchaser of assessee product, to whom assessee has got to control and influence, hence unable to produce the certified copy of account." The AO observed that since no compliance was made to the letters issued u/s 133(6) by the parties, it is the duty of the assessee to furnish the requisite details and the explanation furnished by the assessee is not acceptable. 2.1. The assessee has also been asked as to why provisions of section 145 should not invoked for non maintenance of stock register and for showing low GP rate in the year under consideration in comparison to preceding assessment years. In response, ld. Counsel for the assessee submitted as under :- "1. Assessee is not maintaining stock register due to various varieties of cloth and sizes and colour of kaftan, and due to nature of b....
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.... by the assessee and compute the income accordingly. The observations made by the ld. CIT (A) in para 4 and 4.1 of his order are as under :- " 4. I have considered facts of the case. It is seen that the books of account have been rejected by the AO on the ground that the appellant was not maintaining stock register, opening an closing stock were not available, the details regarding expenses incurred on printing, colour and chemical, packing material, semi finished goods etc. were not be maintained. The AO further noted that some amounts were deposited in the bank account which were claimed to have come from certain purchasers of the goods in Anantpur (A.P), Bangalore and Ahmedabad. The AO issued notice u/s 133(6) to the so called depositors on the addresses provided by the appellant. The appellant was also asked to furnish confirmations from 5 depositors who, as per the appellant, had deposited money. The appellant, however, failed to furnish any details regarding these deposits from these parties. On these facts the AO rejected the books of account of the appellant and estimated income by applying g.p. rate of 8.54%. it is further noted that the appellant has not been able to gi....
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....) and the sale proceeds were deposited in cash by the purchasers in the bank account of the assessee. Subsequently the amounts are transferred to the assessee's Jaipur Bank account and the same are incorporated in the books of account of the assessee. The ld. A/R submitted that as required by the A.O., the assessee has produced necessary evidences in support of sales at Anantpur by producing sale invoice, transport goods receipts, confirmation from transport agency for dispatch of goods, a complete list of purchasers along with invoice no. date of dispatch and complete address. All these documents were considered by the AO and no defect was pointed out. The ld. A/R further submitted that in compliance to AO's note sheet dated 13.10.2011 and 14.12.2011, the assessee repeatedly requested the purchasers at Anantpur (A.P) to furnish their copy of account with the assessee and their confirmations. But the same were not received. Even the letters issued by the AO u/s 133(6) to these parties have not been responded. The ld. A/R contended that since the assessee has no control on these parties as they are purchasers of assessee's products, hence the assessee was unable to produce the copy ....