AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2017 (8) TMI 558
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.... prescribed limit for filing an appeal before the Tribunal. Accordingly, the order was recalled and thus the Appeal and the Cross Objection are fixed for hearing. 3. First we take up Revenue's Appeal in ITA No. 259/JP/2012 pertaining to the A.Y. 2008-09. The Revenue has raised following grounds of appeal:- "1. The CIT(A) has erred in deleting the disallowance of Rs. 12 lakhs even when the rejection of books of account under sec. 145(3) had been upheld by him. 2. The CIT(A) has erred in deleting the addition of Rs. 19,32,946/- made by the AO in respect of the assessee's income from electrical business. 3. The appellant craves leave to add, alter, amend, withdraw or insert any ground or grounds of appeal before or at the time of hearing of the appeal." 4. Ground no. 1 is against deleting the disallowance of Rs. 12 lakhs made by the Assessing Officer on account of disallowance out of indirect expenses. 4.1 Ld. D/R submitted that in this case, the Ld. CIT(A) affirm the view of the Assessing Officer for rejection of books of account for deleting the disallowance. On the contrary, Ld. AR supported the order of the Ld. CIT(A) and submitted that similar addition was made in the....
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....made, i.r.o., disallowance of indirect expenses of branch offices of the appellant. Consequently, this ground of appeal is allowed." 4.3 From the above finding of the Ld. CIT(A), it appears that the Ld. CIT(A) followed the decision of the Tribunal in assessee's own case pertaining to the Assessment Year 2007-08. The Revenue has not pointed out any change into the facts and circumstances in this year. Therefore, we do not see any reason to interfere into the finding of the Ld. CIT(A), same is hereby affirmed, this ground is Revenue's appeal is dismissed. 5. Ground no. 2, is against deletion of Rs. 19,32,946/- made by the Assessing in respect of the assessee's income from electrical business. 5.1 Ld. D/R supported the order of the Assessing Officer. 5.2 Per contra, the Ld. Counsel for the assessee supported the order of the Ld. CIT(A), and there is not infirmity into the order of the Ld. CIT(A), same is hereby affirmed. 5.2 We have heard the rival contentions, perused the material available on record. We find that Ld. CIT(A) has decided the issue in para 4.3 of his order as under:- "4.3 I have carefully considered all the relevant facts and circumstances of issue consideratio....
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.... contrary to the provisions of law and facts, the same kindly be deleted in full." 9. Ld. Counsel for the assessee reiterated the submissions as made in the written submissions. The submissions of the assessee are as under:- Submission 1. Firstly, we rely upon the written submission (PB 1-2) made before the Ld.CIT(A). The same are reproduced hereunder for a ready reference. "1. The AO has rejected the books of account u/s 145(3) in a routine manner without pointing out any defect in the books for the year under appeal. 2. The reason given by the AO for rejection of books of accounts is that in the preceding year also the books were rejected and the assessee admitted that the position of accounts is the same for this year as was in the preceding year. This kind of wild assumption and presumptions cannot be basis for rejection of books of accounts for the current year. It will not be out of placed to mention that the assessee has given full explanation to CIT(A) in respect of all the alleged defects pointed by the AO in AY 2007-08. 3. The assessee has shown better GP rate of 3.31% (as per revised GP chart filed with covering letter dt. 22.12.2010) in this year as comp....
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....the same position of accounts in both the years even for invoking of Sec. 145. On the contrary, in A. Y. 2007-08 the assessee challenged the application of 145 (3). Thus, there being no such basis Sec. 145 has to be quashed. 2.4 The only objections raised by the AO in A. Y 2007-08 were that (i) in AO's view there was a higher amount of commissions paid or (ii) higher number of employees were kept than what was reasonably required. The assessee acted as a businessman and in his decisions the AO could not have interfered as is the law settled. (iii) Cash Sale cannot be doubted: With regard to the other allegation that most of the sales of recharge coupons were made in cash and the same was not fully verifiable in the absence of complete name and address of the purchaser. It is submitted that in fact, the authorities below have placed unwarranted stress on this issue. Making sales in cash is nowhere prohibited. Nor therefore, is a valid basis of rejection. It has been held that cash transactions, where the delivery of the goods is taken against cash payment. It is hardly necessary for the seller to bother about the name and address of the buyers and books of assessee c....
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....ussion made by the AO and the Ld. CIT (A) in A. Y. 2007-08, the facts of that year are summarized for better appreciation (though such details are available in ITAT order or A. Y 2007-08 PB 20-51). In that year BSNL permitted the assessee to pass on minimum commission of 3 % till 12th November 2006, as per earlier agreement 21st March 2005 (copy of relevant section IV of the agreement is at PB 73) but for the remaining year it was raised to minimum 5 % by second agreement dated 14.11..2006 (Kindly see annexure A annexed to the w/s). The Ld. CIT (A) refers 3%or 4.5 % (for later correct is 5%). The assesee, in fact, passed on only minimum 3%/5% as the case may be. The AO however, read the facts as if only 3% was permissible as against alleged actual payment 4% for both period and hence, the assessee paid 1% in excess therefore, taking 1% of the turnover, he disallowed Rs. 30.87 Lacs however, the Ld. CIT (A) considered average 3.86 % reasonable and comparing alleged actually paid 4%, treated balance 0.14 % excessively paid and computing with reference to turnover reduced the addition to Rs. 5 LAcs. The Hon'ble ITAT further reduced the addition to Rs. 2.50 Lacs. The impugned enh....