2024 (5) TMI 1255

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.... National Faceless Appeals Centre(hereinafter referred to as NFAC) is erroneous both on facts and in law. 2. The NFAC ought to have noticed that the AO estimated the profit @ 3% on the cost of goods sold without rejecting the audited books or pointing out any defects and hence the estimation of profit is arbitrary, unreasonable and perverse more particularly when he sought to make a further addition of Rs. 57,26,837/- . 3. The NFAC erred in confirming the addition of 57,26,837/- referable to incentives received by the Appellant ignoring the fact that such amount was already credited to the Profit and Loss account(by way of reducing the cost of the goods) and hence no addition of such amount could have been made since incom....

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....e assessee. The assessee carried the matter in appeal before the first appellate authority but could not succeed. The learned CIT (A) NFAC for the reasons stated in the appellate order dated 10/08/2023 rejected the argument of the assessee and upheld the addition towards the estimation of profit on total turnover excluding the incentives received and addition of incentive received separately to the income of the assessee. 4. Aggrieved with such order of the learned CIT (A) the assessee is in appeal before the Tribunal. 5. The learned Counsel for the assessee Shri Shashank Dundu, submitted that the learned CIT (A) NFAC is erred in sustaining the addition made by the Assessing Officer towards estimation of profit in addition to making s....

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..... 7. We have heard both the parties, perused the material available on record and gone through the orders of the authorities below. The assessee is in the business of retail trading in liquor has admitted 4.8% net profit on total turnover. The assessee has included incentive received from manufacturers of products in the sales turnover. The Assessing Officer has excluded incentive from the sales turnover while determining the income from business. The Assessing Officer has adopted 3% net profit on total turnover excluding incentive and made separate addition towards incentive received by the assessee. We find that the incentive is normally given by the manufacturers of products to promote their produce in a competitive market. The incent....