TaxTMI 
TaxTMI 
2017 (6) TMI 1040
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....ccount of current liabilities and provisions being creditors for goods. The ground no. 2nd is not pressed and considered as withdrawn by the assessee. 1.0 In the 1st ground of appeal, the assessee's contention is that the CIT (Appeals) was not justified in confirming the net profit rate of 8% on gross contract receipt, without looking into the past history of the case and comparable cases. 2.0 During the course of assessment proceedings, the AO observed that the assessee did not produce vouchers in respect of purchases and expenses and thus recording this discrepancy, the AO has rejected the books of account of the assessee by invoking the provisions of sec 145(3). Thereafter, the AO has estimated the income of the assessee by applying the net profit rate of 8% on the gross total receipts declared by the assessee before depreciation, interest and remuneration payable to male partners and that the AO has further added Rs. 4746617/- towards the income of the appellant, which represents the accretion in the amount of sundry creditors for non-furnishing of confirmation of the same. 3.0 The ld. CIT (A) has confirmed the addition, inter- alia, agreeing with the view of the AO of....
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....e. As per the assessee's past history, the profit of the assessee for the last two years is as under: Particulars A/y 2009-10 A/y 2008-09 A/y 2007-08 Gross Receipts 50,120,007.00 57,623,108.00 54,998,753.00 Net Profit after interest and salary paid to partners 470165.00 676732.00 888748.00 N.P. rate after interest paid to partners 0.938% 1.18% 1.6% Net Profit before interest and salary paid to partners 1774795.00 1952991.00 2102171.00 N.P. rate before interest paid to partners 3.54% 3. 3% 3.8% Sundry Creditors 14,763,840.00 8,846,706 8,171,203.00 The AR also submitted that there is consistency in the trading results shown by the appellant, thus, as per past history, the assessee's income during the year under consideration is entitled to be accepted and addition made on this score by applying the net rate of 8% is liable to be deleted, having no basis for such estimation. 6. The ld. DR ,on the other hand, supported the impugned order. 7. It is undisputed fact that books of account are rejected by invoking provisions of Section 145(3) of the Act, pointing out that purchases and expendi....
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....6,617/- on a/c of 'Current liabilities & Provisions, being creditors for goods. The amount of Rs. 47,46,617/- has been worked out by deducting the balances under the 'Current liabilities & provisions' of assessment year 2008-09 from the assessment year 2009-10. 9.2 While upholding the addition, the ld CIT (A), inter-alia, observed as under- "The appellant has not been able to furnish any evidence to prove the genuineness of the liabilities appearing in the balance sheet. Therefore, the action of the A.O. treating the same as unproved liability is required to be confirmed because even during the course of appellate proceedings also the appellant has not been able to furnish any evidence to prove the genuineness of these liabilities. As far as the decision of the ITAT cited by the appellant are concerned, it is of no help to the appellant as the facts of the case of the appellant are different from the facts of the case citied by the appellant. Accordingly, this ground of the appeal is dismissed and the order of the A.O. is confirmed." 9.3 For the assessee, the ld AR filed a written reply that reads as under- "Ground No. 3: (a) That the AO has made th....
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.... 5. Decision of Hon'ble 'High Court of Punjab & Haryana', in the case of C.I.T. vs. Smt. Santosh Jain, 296 ITR 324 (PH)." 9.4 Per contra, the ld. DR supported the order of the CIT(A), relying on the following decisions- I. Devinder Singh Vs. CIT-III,Ferojpur [2007] 104 ITD 325 (Amritsar), ITAT, Amritsar Bench. II. CIT Vs K. Palaniappan, [2000] 242 ITR 719 Mad (HC). III. CIT Vs M/s Kerala Sponge Iron Ltd, Kerala, ITA No. 195 of 2014 in Kerala (HC) Civil Appeal No. 9772 of 2013 IV. Allahabad (HC) -Sarraf Trading Co. V. Liberty Plywood P. Ltd Vs. ACIT Ambala, ITA No. 727/Chd/2012. ITAT Chandigarh. 9.5 The ld AR argued further that the cases relied on by the department are distinguishable on facts. 9.5.1 That in the case of 'Devendra Singh vs. ACIT, Firozpur, Amritsar, the facts are that the assessee was commission agent for sale of agricultural produce, like cotton , narma and addition was made under Section 68, in respect of specific entries in the books of account of the assessee, in the back ground of meagre capital owned and yet shown several credits in balances while in the case of the appellant, the books of account are r....