TaxTMI 
TaxTMI 
2018 (9) TMI 783
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....elated, for the sake of convenience, we dispose of both these appeals by common order. 2. First we take up ITA No.60/RJT/2014. 3. Though the assessee has taken nine grounds of appeal, but in brief his grievance revolves around a single issue viz. the ld.CIT(A) has erred in confirming addition of Rs. 5,58,260/- after upholding rejection of book results under section 145 of the Income Tax Act, 1961. 4. In response to the notice of hearing, the ld.counsel for the assessee filed written submissions which has been taken on record. 5. Brief facts of the case are that the assessee has filed return of income on 4.3.2009 declaring total income at Rs. 1,21,680/-. The assessee had at the relevant time was engaged in the trading of pan masala, ciga....
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....fact that the appellant for the first time on 20.12.2010 during the course of assessment proceedings has admitted and disclosed the sale transactions pertaining to mobile vouchers which hitherto kept outside the books of accounts, the assessing officer has more than reasonable in computing profits from the unaccounted business of trading in mobile vouchers by taking the margin only at 5% of the total receipts and further given a deduction of Rs. 65,000 to meet the administrative expenses. The net addition of Rs. 5,58,260 on account of unaccounted business of mobile vouchers is reasonable is therefore made, which comes to 4.47% on the unrecorded sales of mobile vouchers at Rs. 1,24,65,192. the argument of AR, that the net profit margin of on....
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.... keeping in view the Accounting Standard notified by the Central Government from time to time. Sub clause 3 provides a situation, that is, if the Assessing Officer is unable to deduce the true income. On the basis of method of accountancy followed by an Assessee than he can reject the book result and the assessee's income according to his estimation or according to his best judgment. The Assessing Officer in that case is required to point out the defects in the accounts of Assessee and required to seek explanation of the Assessee qua those defects. If the assessee failed to explain the defects than on the basis of the book result, income cannot be determined and Assessing Officer would compute the income according to his estimation keeping ....
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....the view that the estimation of the profit arrived at by the AO cannot be found faulted. The assessee could have easily made the job of AO more easier if he has submitted details showing commission received by him from the mobile companies. That would eliminate the guess-work for estimating the profit. But instead of agitating the issue upto the level of second appellate authority, this very easy step was not taken by the assessee. In the absence of any details, we are of the view that the ld.CIT(A) has rightly exercised his discretion of estimating the profit. We find that no error in the order of the ld.CIT(A). Thus, ground of appeal is rejected. 10. The next ground of grievance of the assessee is that the ld.CIT(A) has erred in confirmi....
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....ne of Rs. 1.25 crores in his books of accounts. The AO observed that as per the provisions of section 44AB of the Income Tax Act, the assessee requires to get his accounts audited since the total turnover of the assessee exceeded Rs. 40 lakhs, which the assessee failed to do so. AO accordingly initiated proceedings under section 271B for his failure to get accounts audited and issued show cause notice. Explanation of the assessee was not found acceptable to the AO. Accordingly, the AO levied a penalty of Rs. 72,928/- under section 271B of the Act. In appeal before the first appellate authority, the action of the AO for imposing penalty under section 271B was upheld. The discussions made by the ld.CIT(A) while confirming order of the AO are ....
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....he turnover of the assessee in terms of section 44AB of the 1. T. Act. 1961,and the assessee himself has also treated the same as part of his gross turnover. The contention of the assessee is therefore not acceptable and it is held that the assessee failed to get his accounts audited as provided u/s 44AB of the I.T. Act. Since the assessee has failed to justify with reasonable cause, his failure to get his accounts audited u/s 44AB, he is held liable for penalty u/s.271B of the IT. Act, 1961." 4. I have considered carefully, the submissions made by the appellant and the penalty order passed by the assessing officer. At the outset, this is a case where the appellant has not disclosed the business of trading in mobile recharge vouchers amo....