TaxTMI 
TaxTMI 
2017 (2) TMI 1360
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.... of the Income Tax Act, 1961; in short "the Act". 2. Shri Patel invites our attention to assessee's identical additional ground in former three assessment years challenging validity of Section 153A proceedings invoked by the lower authorities. He submits very fairly after arguing for some time that the assessee is not interested in pressing for his said legal plea. We thus decline the above additional ground in former three assessment years as not pressed. 3. We now advert to rival pleadings. The Revenue's identical plea in all of its six appeals is that the CIT(A) has erred in law and on facts in deleting Section 40A(3) disallowance/additions of Rs. 34,61,408/-, Rs. 67,52,657/-, Rs. 68,73,760/-, Rs. 493310/-, Rs. 55,31,54,616/- & Rs.....
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.... already declared. Our view as per hon'ble jurisdictional high court's decision stated hereinabove is that in case we uphold CIT(A)'s order rejecting assessee's books of account, Revenue's former substantive ground would be rendered academic. 5. Ms. Vibha Bhalla (learned CIT-DR) vehemently argues that the CIT(A) has made altogether a new case in rejecting assessee's books thereby adopting above stated 3% net profit as the same is very much in contravention to his lower appellate jurisdiction vested u/s. 251(1)(a) of the Act postulating the same to be in the nature of confirmation, reduction, enhancement or annulment of an assessment only. She takes us to Form 35 comprising of assessee's pleadings / grounds raised before the lower appe....
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.... 15 of the paper book) stating therein to have issued Section 133(6) notices to assessee's cash payees who appeared to confirm to have collected waste paper as his agents, handed over the said material collected to him who supplied the same to various paper mills. The Assessing Officer then issued Section 131 summons on random basis to nine of the assessee's payees. They also attended the remand proceedings to again depose in assessee's favour. The Assessing Officer's latter remand report came on 21.11.2013 (pages 16 to 19 of the paper book) inter alia stating that assessee's case did not come under various exceptions to Section 40A(3) of the Act as prescribed under Rule 6DD(k) of the Income Tax Rules. The Assessing Officer thereafter repor....
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....it can be presumed that the earlier stock purchased was sold out on day today basis to paper mills. The figures of sales as per Sales-tax return, are not available therefore, there is no option but to take turnover whichever is higher as reflected in I.T. Returns or in .impounded material, as real and actual turnover for A.Ys. involved in question can be worked out as under: Rs. In lakhs F.Y. A.Y. Purchases as Per I.T. Return Sales as per I.T. Return Purchases as per Impounded material Actual turnover for determining profit 2004-05 2005-06 216.34 228.08 - 222.08 2005-06 2006-07 422.04 431.04 - 431 .69 2006-07 2007-08 429.61 435.96 - 435.96 2007-08 ....
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....t years except in A.Y.2008-09, where there is enhancement of income to the extent of Rs. 10,82,338/- [Rs.24,35,040/- as determined above- Rs. 13,52,702/- as determined by the Assessing Officer]. The A.R. has objected to this enhancement of income being done by adopting net profit @ 3%. But it is on record that the A.R. on behalf of the appellant has already accepted the defects in books of account and other details/records maintained, & he himself proposed for determination of profit/income by applying provisions of section 145(3) of the I. T. Act. 5.15 It is also seen that on similar facts and the circumstances, the CIT(A)- II,Ahmedabad in his order dated 22.11.2012 against assessment order passed u/s.143(3) r.w.s. 153A o....
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....y the concerned appellant . We observe that assessee's case in the facts narrated hereinabove is much stronger since he has indeed raised the issue of rejection of books during the course of the lower appellate proceedings. The Revenue further fails to prove any genuineness element in assessee's books of account by leading cogent supportive material. We thus find no reason to interfere with CIT(A)'s order rejecting assessee's books of account thereby estimating his net profit @ 3%. The same renders Revenue's former substantive ground seeking to revive Section 40A(3) disallowance/addition as made by the Assessing Officer in all the impugned assessment years in view of hon'ble jurisdictional high court's decision (supra). We accordingly do....