TaxTMI 
TaxTMI 
2025 (11) TMI 455
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....or the Appellant : Shri S.Sridhar & Shri S.Senthil Kumar, Advocates (Erode) For the Respondent : P. Krishna Kumar, JCIT ORDER PER MANU KUMAR GIRI (Judicial Member): The captioned eighteen (18) appeals/cross objections filed by the different assessees' and revenue are directed against separate orders of the Ld.Commissioner of Income Tax (Appeals), Chennai- 20 [CIT(A)] all are dated 18.03.2025 for Assessment Years 2017-18 & 2018-19. The details are as under: Assessee AYs ITA Number / C.O Number SRI THENU SILKS 2017-18 ITA No. 1372/Chny/2025 (Assessee) SRI THENU SILKS 2018-19 ITA No. 1373/Chny/2025 (Assessee) SRI THENU SILKS 2018-19 ITA. No.1660/Chny/2025 (Revenue) SRI THENU SILKS 2018-19 CO. No.56/Chny/2025 (Assessee) RAMASAMY MOORTHY 2017-18 ITA No. 1366/Chny/2025 (Assessee) RAMASAMY MOORTHY 2018-19 ITA No. 1367/Chny/2025 (Assessee) RAMASAMY MOORTHY 2018-19 ITA No. 1659/Chny/2025 (Revenue) RAMASAMY MOORTHY 2018-19 CO. No.58/Chny/2025 (Assessee) DHARUMAN VANISUGANYA 2017-18 ITA No. 1376/Chny/2025 (Assessee) DHARUMAN V....
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....t supported by any comparable data. And for other reasons that may be adduced at the time of hearing, your appellant prays that the appeal be admitted, considered and justice be rendered. 4. Brief facts of the case are as under: A Survey u/s. 133A of the Act was conducted on 22.01.2018 in the case of Sri Thenu Group of concerns, P. Puliampatti of Erode District. This group consists of the following entities: i) M/s. Thenu Silks, Puliampatti (PAN: ABAFS2142Q) (Partners - Shri. R. Dharuman, Shri. R. Moorthy and Shri. R. Murugesan) ii) M/s. Thenu Sarees, Puliampatti (Prop: Shri. R. Moorthy, PAN: AGSPM7875R) iii) M/s. Thenu Silks, Avinashi (Prop: Smt. D Vanisuganya, PAN: ALUPV3096J) iv) M/s. Thenu Textiles, Thiruppur (Prop: Shri. R. Dharuman, PAN: AFSPD5712P) v) M/s. Vinayaga Advar Adayagam, Puliampatti (Prop: Shri. R.Murugesan, PAN:AKKPM7054J) vi) M/s. Suba Garments (Prop: Smt. A. Kamatchi, PAN: BDOPK1329Q) The above concerns are mainly involved in the business of retail trading of textiles goods. The assessee, M/s. Sri Thenu Silks, had filed its return of income for AY 2017-18 on 29.10.2017 admitting a total inco....
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.... as is shown in page 19 of the impugned order. Further, the Ld.CIT(A) after perusal of the records and after due consideration of the submissions of the assessee's was that the sales of Rs. 11,51,58,705/-, mentioned above, is only for the period from 19/11/2016 to 31/03/2017 and that this sale has already been disclosed by all the assessees and he went on to hold that the total turnover of all the assessees of Rs. 34,93,24,869/- is alone to be considered. Furthermore, the ld.CIT(A) worked out profit at 25.71 percent on total sales of Rs. 34,93,24,869/-, allocated among all the assessees in the proportion of their gross receipts from business, as found in page 22 of the order and partly allowed the appeal. Now assessees are in further appeal before us. 5. For A.Y.2017-18, the ld. counsel for the assessee submitted that the books of account of the assessees have been audited u/s.44AB of the Act. Further, he submitted that no defects have been pointed out or found in the books of account maintained by the assessees. The ld. Counsel stated that neither the AO nor the Ld. CIT(A) rejected the books of account. Past history of all the assessees has not been considered. The ld. C....
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....ales figure of Rs. 11.51 crore, indicating that the AO's base for profit estimation was flawed. No material discrepancy has been brought on record to suggest that the audited figures of the assessees were unreliable. Therefore, we set aside the estimation of net profit at 25.71% made by the AO. Since the books of accounts are audited and not rejected by the authorities, and the sales figure of Rs. 11.51 crore is already considered by the assessee, which has been accepted and made as a basis for making an estimation of profit and hence no estimation is warranted. Therefore, the additions made on this account are deleted. However, disallowances made under EPF and ESI, which were not contested, are sustained. 8. For A.Y.2018-19, the AO made additions on account of additional profit, stock difference and disallowance on account of late remittance of EPF and ESI payments. The assessees have not filed appeals against the ESI and EPF disallowances. The AO made addition on account of additional profit by making the profit rate at 24.80% and applying on the total sales of Rs. 65,38,92,357/-, while the admitted sales was Rs. 52,46,42,253/-. The aforesaid sales of Rs. 65,38,92,357/- ar....
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....s in proportion to the gross receipts from business. 11. Aggrieved, assessees filed appeals before us challenging only the adoption of net profit ratio at 20.90 percent. The ld. Counsel submitted that the books of account of the assessees have been audited u/s.44AB of the Act. He stated that no defects have been pointed out or found in the books of account maintained by the assessees. He further submitted that neither the AO nor the Ld.CIT(A) rejected the books of account. Even past history of all the assessees has not been considered. He further submitted that adoption of net profit at 20.90 percent for all the assessees is not correct. He furthermore, submitted that basis of arriving at net profit rate at 20.90 percent itself is not correct, since the same is based on Trading and Profit & Loss account, taken out from the pen drive, is not for the whole year but for a limit period from 01.04.2017 to 23.01.2018. The above point is further substantiated by the fact of inclusion of opening balance as on 01/04/2017 of Rs. 11,51,58,705/-. In view of the above, the assessees submits that the estimation of profit by the Ld. CIT(A) at 20.90 percent is very high and the same deserves mo....