AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2018 (4) TMI 1526
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....filed the return of income on 02.07.2011 declaring an income of Rs. 3,47,658/- which was processed u/s 143(1) of the Income Tax Act, 1961 (hereinafter referred to as the Act) at the returned income. Subsequently, the case was selected for scrutiny. The assessee furnished the books of accounts alongwith vouchers which were test checked. However, the AO made the addition of Rs. 4,82,252/- by observing in para 10 of the impugned order as under: "10. In order to work out the income of the assessee from the aforesaid dealings, it may be mentioned that in the 'Biri' a/c, the assessee has shown purchases of Rs. 4,22,13,866/- and sales worth Rs. 4,25,10,624/- thereby giving gross profit of Rs. 2,96,758/- as there are no opening or closing....
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....ellant has stated that the contention of the AO regarding not making any sales on credit basis is not correct. However, appellant has not brought on record any evidence regarding the fact that all sales were made in cash only out of total goods sold of Rs. 4.25 crores as there was no opening or closing stock. In point No. e, appellant has not been able to furnish any reason why he could not remember the name of persons who were making such large payment in cash to him. In point No. f, appellant has tried to show that it was earning less than 2% commission. Appellant has stated that it has produced C Forms duly authenticated by Excise Department Fatehabad, it's books of accounts are audited, purchases sale bill have been produced, books ....
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....t the addition made by the AO and sustained by the ld. CIT(A) was without basis. He gave in writing as under: "In this respect, it is submitted that the above presumption/calculation are also not based even on the facts of the case as explained below:- i) That the rate of commission of 2% as worked out by the Ld. A.O. is not based on the facts of the case as explained above. ii) That the Ld, A.O. has applied the alleged rate of commission on the entire purchases of Biri made from the month of December, 2010 to March, 2012 from M/s Bharat Motors, Banswara whereas no cash transactions (regarding deposit of security on the date of cheuqe encased/credited) was made since after December, 2012. iii) That application of rate of net prof....
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....r books of accounts and all the sales have been duly accounted for in the regular books of accounts which were audited by a qualified Chartered Accountants and no discrepancy what so ever has been pointed out by the Ld. A.O. during the course of assessment proceedings. All the details regarding purchase and sales of biri made by the appellant have already been furnished in the quarterly return submitted to The Excise & Taxation Department, Haryana and who has also issued statutory 'C' forms against the purchases of biri made by the appellant. Further, it is submitted, the Ld. A.O. has also considered the G.P. amounting to Rs. 296758/- earned on the sales of biri as clearly mentioned at para no.4.3 of the assessment order. Therefore, by ....
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.... cash memo or in the books of accounts produced during the course of assessment proceedings. vi) That the A.O. has duly accepted the trading results shown in the biri account while making the assessment and given the relief/credit of GP shown in the biri account while making the addition on the presumption that no actual purchases/sales have been made by the appellant. When GP has been considered, it is means that the sales as well as the purchases are quite genuine." 6. In his rival submissions, the ld. Sr. DR strongly supported the orders of the authorities below and reiterated the submissions made therein. 7. I have considered the submissions of both the parties and carefully gone through the material available on the record. In the....