2018 (11) TMI 428

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.... the order of the Commissioner of Income Tax (Appeals)-7, Hyderabad, dated 01-09-2017, confirming the action of the Assessing Officer (AO) in rejecting the books of account, but estimated the net profit at 4% of the cost of the goods sold as against 5% assessed by AO. 2. Brief facts of the case are that, assessee is an individual, in the business of liquor, filed his return of income for the asse....

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.... & 4 i.e., estimation of income at 4% is on higher side and various Co-ordinate Benches have determined the profit at 3% of the stock put to sale. Ld. Counsel fairly admitted that assessee would be agreeable, if estimation was done at 3%. Ld. Counsel filed the decision of Co-ordinate Bench in the case of Secunderabad Wines Vs. ITO in ITA No. 181/Hyd/2016, dt. 20-07-2016. 4. Ld.DR, however, submit....

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....the case of Suraj Harjani Vs. ITO in ITA No. 1745/Hyd/2017, dt. 11-04-2018, the Co-ordinate Bench has held as under: "5. We have considered the rival contentions and perused the material on record. There is no dispute with reference to the fact that books of account are to be rejected and the income is to be estimated. AO estimated the income @ 5% relying on various Co-ordinate Bench decisions....

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....ange in policy as well as impact of the High Court directions were taken into consideration for the purpose of estimating the net income @ 3% and in fact in the later decisions of the Tribunal, the net income was estimated @ 3% of the cost of goods sold. Under these circumstances, consistent with the view taken by the Tribunal, cited (supra), I direct the A.O. to adopt 3% of the cost of the goods ....