TaxTMI 
TaxTMI 
2020 (12) TMI 865
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....ed in making the addition of Rs. 25,56,706/-, by estimating the Gross Profit ratio without pointing out any specific defect in the books of account as envisaged in section 145 of Income Tax Act, 1961 such action being illegal and therefore entire addition deserves to be deleted. 2. On the facts and in the circumstances of the case and in law the Lower Authorities have erred in making the addition of Rs. 1,26,000/- by invoking provisions of section 40A(2)(b) out of total salary paid to three sons for the services rendered by them during the course of business activity, such ad- hoc disallowance is bad in law and therefore deserves to be deleted. 3. On the facts and in the circumstances of the case and in law the Lower Autho....
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....ficer with detailed clarification and the submissions did not find favour with the Assessing Officer and vide Para 2.5 of his order, the Assessing Officer adopted average gross profit of 4 years of the assessee after considering the gross profit in percentage terms which comes to at 6.81% and by considering this as bench mark and the fact that the assessee had shown gross profit at 4.23%, the fall in gross profit percentage was calculated by the Assessing Officer at 2.53% which comes to Rs. 48,27,215/- which was added to the total income of the assessee. 4. The Ld. CIT(Appeal) on this issue has taken gross profit percentage at 5.57% and since the assessee had already offered gross profit percentage at 4.23%, the Ld. CIT(Appeal) decided to a....
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....e terms. b. Out of total purchases of (17,85,68,244/-, purchases of (12,88,11,434/- are made from Unregistered Dealers, i.e. the dealers who are not registered and not paying any sales tax. c. No justification as regards to the breakage/damages claimed In view of the above, the contention of the appellant that the A.O. has not given the specific reason for rejection of books of account is not tenable. The judicial decisions in the case of Alluminum. Industries (P) Ltd. V. CIT (1995) 80 Taxman 184(Gau) and Rais and Co. V. Asstt CIT (2003) 172 Taxation 79 (Cal-Trib), on which the appellant has relied upon, are not squarely applicable to his case, as the reason for the rejection of the books were given by th....
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....gree with the method adopted by the A.O. In view of the facts and circumstances of the case, I am of the view that AO was not justified in disallowing Rs. 48,27,215/-. Therefore I hereby decide to take the G.P. ratio, for the purpose of addition, as an average of the G.P. ratio for AY. 2009- 10 and 2010-11, i.e. of 6.64% and 4.50%, which comes to be at 5.57%. The appellant has already offered the G.P. ratio at 4.23%. In view to meet both the ends of the justice, I hereby decide for the addition in G.P. percentage of 1.34% (5.57-4.23). Thus the addition to the tune of Rs. 25,56,706/- (1.34% of Rs. 19,07,99,008/-) is confirmed on this issue and the appellant has been given a relief of Rs. 22,70,509/-. Hence the Ground No.1 of the appellant ha....
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....9. We are of the considered view that the salary and bonus paid per annum to each of the son of Rs. 1,68,000/- i.e. Rs. 14,000/- per month including bonus. Considering these facts, it was asked to the Ld. DR whether this amount of Rs. 14,000/- paid as salary per month to each sons for doing business work of the assessee, whether it was unreasonable. The Ld. DR submitted that the salary paid for the work done was reasonable. That it is also not the case of the Department neither in the order of Assessing Officer nor in the order of the Ld. CIT(Appeal) that the assessee's sons were not at all involved in the business of the assessee or that there was no work done by them in respect of the business of the assessee. That both, the Assessing Off....