2025 (9) TMI 1581

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.... is based on conjectures and surmises. ii) That the Ld. CIT(A) has erred in confirming the addition of Rs. 10,00,000/- on account of unsecured loan as the same is bad in law and liable to be quashed. iii) That the Ld. CIT(A) has erred in confirming the addition on account of administrative / operational expenses on account of rebate of sale and rent of L-13, amounting to Rs. 1,64,219/- and Rs. 1,66,340/- respectively being arbitrary, bad in law and liable to be quashed. iv) That the arbitrary adhoc disallowance of expenses to the tune of Rs. 45,882/- is bad in law and liable to be quashed. 2. Brief facts of the case are that the assessee is an individual and has filed ITR for the AY 2016-17 showing business inc....

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....had been missed from being reflected int eh trading account and has not been considered in closing stock as well as for the year under consideration. Hence, the veracity of results, reflected in trading account furnished by the appellant is not reliable. Further, the assessee has not furnished any documentary evidence to justify his claim that the trading results shown by him are correct. The gross profit (GP) rate reported by the assessee is significantly lower than what is typically observed in this particular industry. This discrepancy raises concerns about he accuracy and reliability of he financial statements presented. Thus, the Ld. CIT(A) rightly sustained the addition of Rs. 8,08,245/- which does not need in any interference on my p....

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....ee. 5. As regards, addition on account of administrative / operational expenses on account of rebate of sale and rent of L-13, amounting to Rs. 1,64,219/- and Rs. 1,66,340/- respectively are concerned, I note that rebate and discount on sale amounting to Rs. 1,64,219/- are key policies of marketing, promoting sales, and essentials to attract customers, which plays important role to clear out the old items from the stock. Thus, the assessee has got rebate of Rs. 26 lacs from the vendors and shown them as income in the profit and loss account during the relevant period and rent of L-13 of Rs. 1,66,340/- is rent paid for the outlet which was taken on rent, which is the essential requirement to run the business of sales and purchase of any i....