TaxTMI 
TaxTMI 
2026 (5) TMI 684
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....the Act') dated 28.12.2016 by the Assessing Officer, ITO. Ward-2(2)(2), Firozabad (hereinafter referred to as 'ld. AO'). 2. At the outset, we find that there is a delay in filing of appeal by the assessee before us by 84 days. Considering the reason adduced in the condonation petition, we find that assessee was prevented from sufficient cause in not filing the appeal in time before us. Hence, in the interest of substantial justice, we are inclined to condone the delay and admit the appeal of the assessee for adjudication. 3. The first issue to be decided in this appeal is as to whether the learned CITA was justified in upholding the action of the learned AO in rejecting the book results under section 145(3) of the Act and proceeding t....
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..../ collected from farmers / self-help groups of farmers as well as through small milk suppliers and has also purchased pasteurized / toned/ double milk f/s Nessus Hardiyal milk products Pvt limited and sold in wholesale to various parties. The learned AO noted that assessee in response to notices under section 142(1) of the Act had furnished only part information that were called for. On perusal of the said insufficient details / documents provided by the assessee and taking cognizance of the past behavior of the assessee in assessment year 2013-14, the pattern of transactions, financial flows and method of business which is identical during the year under consideration, the learned AO proceeded to conclude that the books of account of the a....
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....rdingly, the learned AO justified his decision to reject the books of accounts and book results furnished by the assessee and applied the provisions of section 145(3) of the Act and proceeded to estimate the net profit of the assessee. The learned AO also concluded that the transactions with Hardiyal milk products private limited are mere accommodation entries. He noted that as per the ledger account of M/s. Hardiyal milk products private limited, the assessee had made sale of Rs 55,24,76,727 and purchase of Rs 50,46,22,247 and received entries in his bank accounts amounting to Rs 55,12,80,000 from Hardiyal milk products private limited. The learned AO estimated the net profit of the assessee business at Rs 5 per thousand on the entries rec....
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.... that the Learned AO had only resorted to partial rejection of book results of the assessee under Section 145(3) of the Act. The provisions of Section 145(3) of the Act nowhere mandates the application of partial rejection of book results of the assessee. Once the book results are rejected, the only recourse available to the revenue is to estimate the net profit. But in order to reject the book results, the Learned AO should consciously bring on record with cogent evidences deficiencies in the books of accounts and the book results shown by the assessee. In the instant case, no such deficiencies were even pointed out by the revenue. The assessee factually had made purchase of raw milk from Hardiyal Milk Products and has got a chilling plant....
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....milk and also in the business of running tankers, which is actually incidental to the main activity of pasteurization of milk. The tanker running is effectively used for transporting the pasteurized milk to the place of the customers. Hence, both the activities carried out by the assessee are inextricably linked and interconnected. The learned AO had noted that assessee could not prove the genuineness and reasonability of incurrence of tanker running expenses with documentary evidences. Hence, to cover up such deficiency also, the overall net profit of the business need to be estimated. But it cannot be brushed aside that assessee had not fully furnished the requisite details that were called for by the Learned AO from time to time vide iss....