2015 (6) TMI 1257

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.... the addition of Rs. 38,67,710/- made by the AO by applying NP @0.73% by invoking provisions u/s 145(3) of the Income Tax Act, 1961" 2. The order of the ld. CIT(A) is erroneous both in law and on facts" 3. Facts in brief as emerged from the corresponding assessment order passed under section 143(3), dated 19.11.2008 were that the assessee firm is engaged in the business of manufacturing and commission business of rerolled steel product and MS Ingots. The objection of the AO was that the production during the year was lower than the last two previous years. The assessee has informed that there was increase in the power consumption than the last year. However, as per the AO, the assessee was not in a position to explain the reason for t....

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.... Industry (P) Ltd V/s CIT (1995) 80 Taxman 184 (Gau), the Hon'ble High Court has held that addition to the profits of the assessee made solely on the ground that it was low without giving specific finding that the accounts of the assessee were not correct and complete, or that the income could not be properly determined and deduced from the accounting method employed by the assessee is not justified. The mere fact that there was a less rate of gross profit declared by an assessee as compared to the previous year would not by itself be sufficient to justify the addition. A case demonstrating availability of ingredients for applying provisions of section 145(3) was not made out by the AO. Therefore, in the absence of necessary ingredients for....