Case Law Details
ITO Vs Manumati Boro (ITAT Guwahati)
Revenue has challenged the finding of the ld. CIT(A) deleting the addition for undisclosed sale and sustaining the addition only to the extent of net profit element embedded in the alleged undisclosed sale. We notice that the ld. Assessing Officer based on the seized records impounded during the course of survey, made the addition for undisclosed sale of Rs.2,39,42,814/-. The ld. CIT(A) after making a detailed discussion and also referring to various judgments including that of Hon’ble Gujarat High Court in the case of CIT vs. President Industries (2002) 258 ITR 654, came to the conclusion that since the purchases are not in dispute, only the net profit on the said undisclosed sales can be subjected to tax
The above finding of the ld. CIT(A) is in line with the judicial precedents as held consistently including in the judgment of the Hon’ble Gujarat High Court in the case of President Industries (supra), as well as by the decision of the ITAT Delhi Bench in the case of Anil Kumar Bajaj vs. DCIT in ITA No. 4392/Kol/2014; dt. 28/06/2018. We fail to find any infirmity in the order of the ld. CIT(A) who has rightly taken into consideration the net profit offered by the assessee in the last three years and has also taken into consideration that purchases made by the assessee are only made from Bharat Petroleum Ltd. and the ld. Assessing Officer has not disputed the said purchases and since the sale prices are not in control of the assessee and they have to be kept as per the rates decided by the oil marketing companies, the margin of profit can only be subject to tax. Thus, since the ld. CIT(A) has applied highest of the net profit rate i.e., 3.90 % on the alleged undisclosed sales, we do not find any reason to interfere in the said finding. Thus, the effective ground of appeal raised by the revenue stands dismissed.
FULL TEXT OF THE ORDER OF ITAT GUWAHATI
The present appeal is directed at the instance of the revenue against the order of the learned Commissioner of Income Tax (Appeals) – Guwahati-1, (hereinafter the “ld. CIT(A)”) dt. 28/02/2020, passed u/s 250 of the Income Tax Act, 1961 (“the Act’), for Assessment Year 2017-18.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
