TaxTMI 
TaxTMI 
2021 (12) TMI 640
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.... and against the facts and circumstances of the case and hence is unsustainable. 2 That, Id. CIT (A) erred in sustaining the rejection of book of accounts even after accepting production of accounts by AO who has neither found any defect in accounts nor recorded any finding in terms of S. 145(3) of the Act, merely because confirmations are considered defective but without conducting any enquiry about the same. 3. Because, Ld. Commissioner of Income Tax (Appeals) grossly erred in sustaining the application of NP rate @ 8% without any material and basis against the assessee and in whole disregard of the material on the record, past history etc., hence order sustaining addition is arbitrary. Therefore, it is prayed t....
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....be made. With respect to the creditors, 133(6) notices were issued. It remained un-responded. Therefore, show cause notice also stated that addition of Rs. 6,57,21,745/- would also be made treating the sundry creditors un-verifiable. On 26.12.2016, assessee did not produce the books of accounts. Therefore, the Assessing Officer applied provisions of Section 145(3) of the Act and made an addition of Rs. 1,85,79,495/- determining the net profit @ 8% on the total turnover of Rs. 23,22,43,698/-. Consequently the assessment order was passed on 29.12.2016 under Section 143(3) of the Act determining total income of the assessee at Rs. 1,94,88,145/- against the returned income of Rs. 9,08,650/-. 4. Aggrieved the assessee preferred an appeal befo....
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....e basic details. Vide letter dated 6.12.2016 the assessee submitted the details of the secured loans, stock valuation, comparative figures of purchase, sales, gross profit and net profit, the details of other income comprising of duty draw back and bank interest. He referred to the letter dated 20.12.2016 wherein the assessee submitted the details of purchases and sales along with the party-wise list and their ledger accounts. Assessee also submitted the details of various charges, cold storage charges, customs charges, freight, and cartage, shipping charges and transportation charges along with their ledger accounts. It also produces the employee-wise list of the salary paid. The party-wise list along with ledger account along with sundry ....
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....cted. He submitted that books of accounts could only be rejected when there is a patent defect, which is glaring in nature, is shown. He further referred to the assessment order of several other persons where the net profit ratio is accepted by the Assessing Officer in the range of 0.48% to an average of 0.73%. He otherwise submitted that assessee is dealing in the buffalo meat, which is exported and the major expenses is on account of foreign exchange gain and losses as well as the duty draw back benefit received. He otherwise submitted that in the computation of the income made by the ld. Assessing officer in the assessment order he first made an addition of returned income of Rs. 9,08,650/- and thereafter made an addition of Rs. 1,85,79,....
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....013 the assessee has incurred foreign exchange fluctuation loss of only Rs. 4,68,584/- whereas for this year he has incurred such losses of Rs. 36,14,370/-. This itself shows that downfall in the net profit s because of forex loss. This is allowable business loss to the assessee. Naturally, it should not have resulted into rejection of the books of accounts. Further assessee has submitted that in the nature of business carried on by the assessee the quantitative details could not have been maintained. Mere non-maintenance of quantitative details cannot result into the rejection of the books of accounts unless latent, patent, and glaring defects are shown in the books. The arguments of the ld. Lower authorities are that assessee has not prod....