2025 (9) TMI 721

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....e case, the Ld. CIT(A) having concluded that the rejection of the books of account of the assessee on the reasons given by the Assessing Officer was reasonable but erred in holding that estimation of the net profit at 20% of the total sales was not reasonable considering that competitors in similar line of business are much less? The Ld. CIT(A) erred in then directing that re-computation of profit be done at 5% and since assessee had declared profit at 3.36%, further addition at1,64% be made. 2. Whether on the facts and in the circumstance of the case, the Ld. CIT(A) ought to have considered the detailed findings of the fact brought out by the Assessing Officer in the assessment order and having accepted that the rejection of the b....

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....ddition at 1.64% of the gross profit? 7. The Appellant prays that the order of the CIT(A) be set aside on the above grounds and that of the Assessing Officer be restored. 8. The appellant craves leave to amend, or alter any grounds or add a new ground, which may be necessary." 3. None appeared on behalf of the assessee in spite of notices. Therefore, we decide to proceed ex-parte. The ld. D/R was heard at length and orders of the authorities below carefully perused. 4. Briefly stated the facts of the case are that the assessee filed its return of income on 15/02/2022 declaring income of Rs. 40,51,740/-. The return was selected for scrutiny and accordingly statutory notices were issued and served upon the assessee. Du....

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....ounts, at the most he should have estimated the profit and not made additions separately. After considering the facts and the materials available on record, the ld. CIT(A) was convinced with the rejection of books of accounts but observed that the estimation of profits @ 20% on total sales is very high and further accepted that once the profit is being estimated, no separate addition should have been made. While reducing the profit addition to 5% of the sales, the ld. CIT(A) observed that the AO has not considered comparatives in similar line of business and directed the AO to re-compute the profit @5% and since the assessee had already returned 3.36%, the ld. CIT(A) directed the AO to restrict the addition to 1.64% of the turnover. 5. W....