TaxTMI 
TaxTMI 
2023 (9) TMI 893
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....ircumstances of the case and in law, the Appellate Tribunal has erred in upholding the decision of Ld.CIT(A) restricting the G.P@2% and confirming addition of Rs.1,68,32,458/- against the addition of Rs.5,38,26,869/- without considering that assessee himself has shown GP of 3.25% in the immediately succeeding Financial year 2013-2014?" 3 The facts in brief are as under: 3.1 It is the case of the appellant - revenue, that a search action under section 132 of the Income Tax Act, 1961, was carried out in the group cases of Agrawal Group on 27.09.2012. Notice under section 153A of the Income Tax Act was issued on 05.04.2013 and in response to the notice issued u/s.153A, the assessee filed return on 06.05.2014, declaring total income of Rs.61....
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....he Assessing Officer, Ld.CIT(A) vide combined order for the Assessment Year 2012-13 & 2013-14 dated 05.12.2017, partly allowed the appeal of the assessee. 3.4 The revenue filed an appeal before the Appellate Tribunal for restricting the addition made by the Assessing Officer on account of G.P to Rs.1,68,32,458/- as against the addition of Rs.5,38,26,869/-. The Appellate Tribunal vide para 6 and 6.1 of the order confirmed the order passed by the Ld.CIT(A) and dismissed the appeal filed by the revenue. 3.5 The Tribunal, concurring with the findings of the CIT(A) held that a reasonable gross profit of the assessee @2% did not require any interference. The Tribunal confirmed the order of the CIT(A) which also produced the relevant paragraphs ....
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....3.25% only in one year i.e. 2013-14. IL is observed that Kedarnath Corporation and Mahaveer Trading Company are showing profit in the range of 1% to 2% hence the AO was incorrect in choosing base rate of GP at the rate 3.25% (even though finally he estimated 4% for entire group) only on the ground that higher profit is shown by such concerns and same was reasonable. Considering the agricultural produce trading activity, estimation of gross @4% is significantly higher and cannot be considered as correct rate more particularly when no correct comparable third party evidences are brought on record. It is observed that Kedarnath Agri Tradelink Pvt. Limited has shown profit @1.41% in A.Y. 2015-16 and the AO has accepted such profit while pass....
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....@2% for all the Assessment Years. It is observed that as the appellant has already shown gross profit @3.25% in Assessment Year 2013-14, addition made by the AO for Rs.87,66,182/- is ordered to be deleted. Further, in A.Y. 2012-13, AO has made addition of Rs.5,38,26,869/- based upon estimation of gross profit @4% and after considering reasonable gross profit at the rate of 2%, addition of Rs.1,68,32,458/- is confirmed out of total addition of Rs.5,38,26,869/- made by the AO. These grounds of appeal are partly allowed." 3.6 The Tribunal, has held as under: "6 We have given our thoughtful consideration and perused the materials available on record. It is seen from the Ld. CIT(A)s order that Kedarnath Agri tredelink Pvt. Ltd. (Assessee in ....