TaxTMI 
TaxTMI 
2017 (6) TMI 598
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....fter referred to as 'the Act') vide his order dated 03.11.2010 for assessment year 2008-09. Shri Arvind Agarwal, Ld. Advocate appeared on behalf of assessee and Shri Rajat Kumar Kureel, Ld. Departmental Representative represented on behalf of Revenue. 2. Both the appeals are heard together and are being disposed of by way of common order for the sake of convenience and brevity. First we take up assessee's appeal in ITA No.2459/Kol/2013. 3. Ground No. 1 to 6 are inter-related and therefore being taken up together for the sake of convenience. The first issue raised by the assessee is that Ld. CIT(A) erred in estimating the profit @ 1.5% of the total turnover. 4. The facts in brief are that assessee is a Hindu Undivided Family and ....
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....to estimate the income on the basis of available information. Thus, Ld. CIT(A) partly allowed assessee's appeal by observing as under:- "12. In the situation described above, a fair assessment, in my view is to estimate income at a percentage of turnover. Since power of CIT(A) is coterminus with that of Assessing Officer and in view of explanation to section 251, I invoke the power to determine income in such manner. The gross profit and net profit disclosed by appellant is as under:- A.Y Turnover Rate of gross profit Rate of net profit 2005-06 146394572 2.36% 0.26% 2006-07 148870624 2.56% 0.35% 2007-08 123418019 2.65% 0.44% 2008-09 117814321 2.80% 0.45% ....
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.... taxes income computed in the manner stipulated in the Act. Therefore I hold that addition over and above what has been determined above is needed. 14.On the disallowance under section 40(a)(ia), I direct the Assessing Officer to make further addition only in respect of those persons to whom interest is credited and from whom appellant has not obtained Form 15G. the forwarding of such Form 15G to CIT is not material to the decision taking cue from the decision in ITO, Ward-2(3), Kolkata vs. M/s Link Consultants Pvt. Ltd. of ITAT 'A' Bench, Kolkata dated 29.11.2011. the Assessing Officer is directed to make verification of record i.e. whether Form 15G received in time in this regard and if received, not to effect any addition. ....
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....come Tax (Appeal), Asansol erred on facts as well as in law in estimating income in most arbitrary manner while he himself admitted in the said order that explanation furnished to the queries of Ld. AO is plausible. 5) For that, without prejudice to above, estimate of income made @ 1.5% of turnover at Rs. 1767214/- e.g. more than 4.2 times of disclosed income at Rs. 429331/- (before deduction u/s 80C) can never be called best judgment assessment either in law or on past assessments. 6) For that, without prejudice to above, in the facts and circumstances of the case, the ld. Commissioner of Income Tax (Appeals) ought to have adjudicated the grounds of appeal adduced before him in favour of the appellant that there is plausi....
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.... account play the crucial role. In the absence of books of account, we find that Ld. CIT(A) had to resort to accept to determine the income to the best of his judgment. However, the income in the case of based judgment assessment should be worked out reasonable and scientific manner. As from the submission of Ld. AR we find that income declared in the earlier year is quite less than 1.5% and same was also accepted by Revenue. Considering the facts and totality we are of the view that the income on estimated basis should be. 80% to the gross turnover of the assessee. It is because the amount of profit shown by assessee in the earlier years cannot be set aside while determining the income on the basis of best judgment. Therefore after conside....