TaxTMI 
TaxTMI 
2023 (12) TMI 1042
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....re that the assessee is engaged in trading (export and domestic) of various commodities. During the assessment year in question i.e., A.Y. 2005-06, the appellant/assessee received gift of jewellery valued at Rs. 34,68,900/- which was introduced as capital in the business. Out of the aforesaid jewellery, the assessee sold jewellery valued at Rs. 9,00,000/- to M/s. Bhootnath Jewellers (P) Limited and received two cheques of State Bank of India, Burrabazar Branch, Kolkata being cheque no. 572020 of Rs. 5,00,000/- dated 17th January, 2005 and another cheque no. 572022 of Rs. 4,00,000/- dated 4th February, 2005. During the course of assessment proceedings, the assessing officer enquired the said sale of jewellery. He also made enquiries from the....
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....d the addition of Rs. 9,00,000/- under Section 68 of the Act, 1961. 8. Aggrieved with the order of the ITAT, the assessee filed the present appeal under Section 260A of the Act, 1961. It is stated by learned counsel for the respondent that the Income Tax Department has not filed any appeal against the impugned order of the Tribunal. Submission on behalf of the Appellant/Assessee: 9. Learned counsel for the appellant submits that the addition on the point of GP Rate is totally baseless and without reference to any adverse material on record. The only thing which has been made the basis is the earlier year GP rate whereas each year being an independent unit of assessment, addition solely on account of earlier year's GP Rate cannot be....
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....swered in favour of the assessee and against the revenue and the appeal deserves to be allowed. Submission on behalf of the Respondent/Revenue: 10. Learned counsel for the respondent/revenue submits that the ad hoc addition made by the Tribunal with respect to GP rate disclosed by the assessee is quite genuine and it does not suffer from any perversity. Therefore, no interference in appeal under Section 260A of the Act, 1961 can be made and no substantial question of law is, in fact, involved. He submits that since the assessee has completely failed to establish the transaction of sale of jewellery of Rs. 9,00,000/-, therefore, the addition made under Section 68 of the Act, 1961 is quite correct and it does not give rise to any substa....
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....P rate at 6% as against the disclosed GP rate of 4.6%, which was reduced by the CIT(A) to 5%. The ITAT has further reduced it and made an ad hoc addition of Rs. 4,00,000/- to the Gross Profit. The revenue has accepted the impugned order of the Tribunal, but the assessee being aggrieved with the ad hoc addition of Rs. 4,00,000/- to the GP rate has filed the present appeal. No reason whatsoever has been assigned by the Tribunal to sustain the addition of Rs. 4,00,000/- in the GP rate of the assessee. Under the circumstances, the finding of the ITAT that ad hoc addition of Rs. 4,00,000/- to the disclosed GP rate of the assessee would be reasonable and fair, is based on no material. Even the Tribunal has not recorded any finding based on any....
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....ssing officer or the Tribunal to dispute the transaction of sale of jewellery. No finding has been recorded by the assessing officer or the Tribunal that M/s. Bhootnath Jewellers (P) Ltd. is a fake concern or the transaction of sale is fake. Under the circumstances, the explanation submitted by the assessee for receipt of consideration for sale of jewellery through account payee cheques could not be disbelieved. The findings recorded by the Tribunal to uphold the addition of Rs. 9,00,000/- under Section 68 of the Act, 1961 is, thus, perverse. 15. Bare reading of Section 68 of the Act, 1961 suggests that there has to be credit of amount in the books maintained by the assessee during the assessment year relevant to the previous year and th....