AO cannot estimate GP rate without rejection of books & without showing defects

Sanjay Agrawal Vs DCIT (ITAT Raipur) Sanjay Agrawal Vs DCIT (ITAT Raipur) – Rejection of books, arbitrary income estimation, and legal principles – AY 2012-13. There are large number of decisions which say in unison that AO cannot estimate gross profit rate without rejection of books and without showing defects. In CIT v. Paradise Holidays [2010] 325 ITR 13 (Delhi), the hon’ble Delhi High Court has held that if accounts which are regularly maintained in the course of business and are duly audited, free from any qualification by the auditors, should normally be taken as correc...