Unrecorded sales receipts: profit estimates require evidentiary basis, while off-book entries cannot trigger cash-credit additions.

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Profit estimation on unrecorded ready-mix concrete sales must have a reasonable nexus to the material and cannot replace an accepted turnover working without supporting evidence. Where audited results for the same activity showed a gross loss and the books were neither rejected nor found defective, departing from the year-specific approach adopted in prior assessments was unsupported; the estimated gross-profit addition was deleted. Cash-credit provisions require a credit in the taxpayer's own books. Off-book pen-drive entries attributed to unrecorded sales could not support a cash-credit addition, particularly where taxing full receipts beyond their profit element would result in double assessment. The cash-credit addition was deleted.....