CA Prarthana Jalan
ACIT V/S Smt. Meena Singh Shekhawat L/h of Late Sh. Bhopal Singh Shekhawat
Against the deletion of the trading addition of Rs. 2,89,123/- in A.Y. 1998-99 , the ld. D.R. has argued that the G.P. rate disclosed in this year is on lower side as compared to earlier year. Since the books of accounts of the assessee having been lost and this fact being accepted by the Assessing Officer, the application of average rate of G.P. in the two past years is wholly justified. The ld. CIT(A) has relied on the decision taken in the first ground and the position of facts and contentions of the parties remaining same and similar he has deleted the trading addition.
Before us also earlier arguments have been reiterated. We have found that the G.P. rate in this year has been on lower side. However, the decrease in G.P. rate stands explained by the undeniable reasons that there is heavy increase in purchase price, freight cost and export cost. The books of accounts were lost and assessee has filed an FIR. The assessee has produced particulars of blocks-purchased and purchase bills were made available vide letter dated 05.12.2005. The Assessing Officer has not invoked section 145(3) in its terms. Therefore, fall in G.P. rate cannot be made a reason for involving section 145(3). Accordingly, we confirm the impugned deletion.