TaxTMI 
TaxTMI 
2017 (1) TMI 765
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....,310/-, which was processed u/s 143(1) of the Income Tax Act, 1961. Case of the assessee was selected for scrutiny and assessment was completed u/s 143(3) of the Act by estimating income at 20% of the stock put to sale. 3. On appeal, the Ld. CIT(A) scaled down the percentage from 20% to 10% and directed the A.O. to re-compute the income at 10% of purchase price. 4. On being aggrieved, assessee carried matter in appeal before the Tribunal. At the time of hearing, the Ld. Counsel for the assessee has submitted that the issue involved in this appeal is squarely covered by the decision of the coordinate bench of this Tribunal where the Tribunal has scaled down the estimation of profit from 10% to 5% in the case of Tangudu Jogisetty in ITA No.....
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....e of business carried on by the assessee. It is further submitted that the case law relied upon by the assessee is not applicable to the facts of the present case. The case before the Hon'ble A.P. High Court was that the assessee is into the business of trading in arrack, whereas it is in the business of dealing in IMFL. The assessee further contended that IMFL trade was controlled by the State Government through A.P. State Beverages Corporation Ltd. and the prices of the products are fixed by the State Government. The assessee being a license holder of State Government cannot sell the products over and above the MRP fixed by the State Government. We find force in the arguments of the assessee for the reason that the A.O. has estimated the ....
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....27/Hyd/12 and others dated 18.05.2012 as well as a number of other cases have held that profit in case of business in Indian made foreign liquor has to be estimated at 5% of the purchases made by the assessee. Therefore, following the decision of the ITAT Hyderabad bench, we set aside the order of the CIT(A) and direct the assessing officer to estimate the profit from the wine business of the assessee by applying the rate of 5% of the purchases made net of all other deductions. The assessing officer should also bear in mind that in no case the income determined should be below the income returned." 9. Considering the facts and circumstances of this case and also respectfully following the ratios of coordinate bench, we are of the view tha....
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....has invested an amount of Rs.3,50,000/- towards investment for 10% share in the business. However, the Assessing Officer has not accepted the explanation given by the assessee on the ground that excise licence is in the name of assessee and the business carried out by the assessee in the name of firm/association, it is a proprietorship. He also observed that Shri Jagan Mohan Rao filed an invalid return of income for the Assessment Year 2011-12 only on 03/09/2013. With the above observations, the Assessing Officer has disbelieved the explanation given by the assessee and the amount of Rs. 3,50,000/- was considered as unexplained credit to the capital account and the same is added to the income of the assessee. 9. On appeal before the CIT(A)....