AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2017 (8) TMI 654
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....e. The assessee is engaged in the business of liquor trade and for the assessment year 2011-12 the Assessing Officer estimated the income @ 20% on total sales of Rs. 2,09,71,765/- and determined the net profit of Rs. 41,42,987/-. The assessee went on appeal before the CIT(A) and the CIT(A) restricted the net profit @ 10% on total sales. 3. On being aggrieved assessee carried the matter in appeal before the Tribunal. 4. The Ld. Counsel for the assessee has submitted that the coordinate bench of the Tribunal in the similar lines of the business considered the very similar issue and restricted the estimation at 5% of the purchase price, in ITA Nos.65&66/Vizag/2012 dated 3.3.2014 in the case of T. Appalaswamy and submitted that the same m....
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....ed 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 net profit by relying upon the decision of A.P. High Court in the case of CIT Vs. R. Nar....
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.... 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 that the net profit estimated by the A.O. by relying upon the decision of Hon'....
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....ddition of Rs. 32,37,704/-. Aggrieved by the order of the A.O., the assessee went on appeal before the CIT(A) and the CIT(A) confirmed the addition made by the A.O. as per paragraph no.5.3.4 as under: "5.3.4 A plea was also raised that once the books of account are rejected, then the AO is not justified in making addition to cash credits with reference to the same books of account. In support, the assessee relied on the decision of the Hon'ble AP High Court in the case of Maddi Sadarshanam Oil Mills Co. V. CIT (37 ITR 369) and Indwell Constructions v. CIT (232 ITR 776 AP). In this regard, it is relevant to note a similar issue as to whether addition u/s 68 or 69 could be made when the AO has estimated the income was dealt by the Ho....
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....ons of Rs. 5,00,000/-, Rs. 32,31,704/- & Rs. 56,577/-. 10. Aggrieved by the order of the CIT(A), the assessee filed appeal before us and submitted the confirmations received from various parties i.e. 43 in number before us. The Ld. A.R. explained that the assessee could not furnish confirmation letters before the CIT(A) due to the reasons beyond his control and neither intentional nor deliberate. We have gone through the reasons in the petition for admission of additional evidences and the confirmations filed by assessee to support the source of unexplained investment. All the advances were taken from the parties residing in the nearby villages and near and dear. All the loans were supposed to be taken in cash. The Ld. A.R. could not exp....