HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 139 / 2010 Shri Vishnu Dutt Goyal, C/o Lokesh Oil Mills Pvt Ltd., Sitaram Bazar, Kesarganj, Ajmer. ----Appellant Versus 1. Commissioner of Income Tax, N.C.R. Building Statue Circle, Jaipur. 2. A.C.I.T.,, Central Circle, Ajmer. ----Respondents Connected With D.B. Income Tax Appeal No. 118 / 2010 Shri Vishnu Dutt Goyal, C/o Lokesh Oil Mills Pvt Ltd., Sitaram Bazar, Kesarganj, Ajmer. ----Appellant Versus 1. Commissioner of Income Tax, N.C.R. Building Statue Circle, Jaipur. 2. A.C.I.T.,, Central Circle, Ajmer. ----Respondent D.B. Income Tax Appeal No. 140 / 2010 Shri Vishnu Dutt Goyal, C/o Lokesh Oil Mills Pvt Ltd., Sitaram Bazar, Kesarganj, Ajmer. ----Appellant Versus 1. Commissioner of Income Tax, N.C.R. Building Statue Circle, Jaipur. 2. A.C.I.T.,, Central Circle, Ajmer. ----Respondent For Appellant(s) : Mr. Priyesh Kasliwal For Respondent(s) : Mr. Sameer Sharma on behalf Mr. Anil Mehta (2 of 5) [ ITA-139/2010] HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE DR. JUSTICE VIRENDRA KUMAR MATHUR Judgment Per Hon ble Jhaveri, J. 29/05/2017 1. By way of these appeals, appellant has challenged judgment and order of Tribunal whereby Tribunal has dismissed appeals of assessee confirming order of Assessing Officer and CIT(A). 2. This Court while admitting appeal No.139/2010 on 07.04.2010 has framed following substantial question of law: Whether, any addition can be made by estimating alone gross profit on sales, where, purchases and sales shown by appellant are duly accepted, as done by lower authorities, while making trading addition of Rs.10,27,792/- by invoking provisions of section 145(3) of Act and by estimating alone gross profit rate on sales such addition sustained by Tribunal, can be said to be proper? 2.1 This Court while admitting appeal No.118/2010 on 19.03.2010 has framed following substantial question of law: Whether, any addition can be made by estimating alone gross profit on sales, where, purchases and sales shown by appellant are duly accepted, as done by lower authorities, while making trading addition of Rs.9,16,813/- by invoking provisions of section 145(3) of Act and by estimating alone gross profit rate on sales such addition sustained by Tribunal, can be said to be proper? (3 of 5) [ ITA-139/2010] 2.2 This Court while admitting appeal No.140/2010 on 07.04.2010 has framed following substantial question of law: Whether, any addition can be made by estimating alone gross profit on sales, where, purchases and sales shown by appellant are duly accepted, as done by lower authorities, while making trading addition of Rs.9,07,641/- by invoking provisions of section 145(3) of Act and by estimating alone gross profit rate on sales such addition sustained by Tribunal, can be said to be proper? 3. We have heard counsel for parties. 4. In view of concurrent finding of all authorities below and finding arrived at by Tribunal taking into consideration Gross Profit rate of previous year, which reads as under: 7. Considering above submissions we find that though contention of ld. A/R remained that audit report mentioning about opening stock, purchases and sales, closing stock etc. as per Annexure D thereto was filed with return of income and further that stocks have been maintained by assessee in duly audited ledger account itself, but it is also admitted fact in present cases for assessment years under consideration that despite opportunity assessee failed to furnish ledger account. Books of account, etc. before AO and thus AO, was justified in drawing inference that same were not maintained by assessee. finding of ld. CIT(A) that audit report annexed with return of income reveals that appellant had not maintained any stock register, valuation of closing stock has also not been controverted by assessee. Under above circumstance ld. CIT(A) in our view was also justified in coming to conclusion about filing of ledger book for first time before him that it was nothing but after thought, which can not be relied upon facts of case of assessee in this regard in (4 of 5) [ ITA-139/2010] A.Y rs. 1997-98 and 1998-99 (Supra) as relied upon, were distinguishable as in those years assessee was able to furnish ledger book before A.O., hence decision of Tribunal in those years can not be relevant for present years. assessee also failed to furnish stock register etc. before AO as required by him. Under these circumstances, we are of view that AO was justified in coming to conclusion that book result was not verifiable and he had rightly rejected books of account by invoking provisions of section 145 of Act to estimate profit. AO estimated sales and applied g.p. rate of 6% thereupon. AO has however, applied g.p. rate at 6% on basis of g.p. rate shown by M/s. Ajmer Feed Products and M/s. Manohar Feed Products who are manufacturer of Poultry feed. Whereas assessee is simple wholesale trader and their g.p. Rate is not comparable with assessee. It was further contended that before making basis of application of g.p. rate on result shown by those firms, assessee was not given opportunity by AO to confront same. Accepting this contention of assessee and that in earlier year, assessee had shown g.p. rate of 5.80% and there is increase in turnover of assessee during year under consideration as well as considering totality of facts and circumstances of present case, ld. CIT(A) in our view has rightly held it reasonable to apply g.p. rate of 5% on declared sales during years. Since considering all facts and circumstances as well as contention of assessee which have been reiterated before us as well, we are of view that ld. CIT(A) has already given sufficient relief by applying g.p. rate of 5% on declared sales instead of estimated sales by AO, hence we are not inclined to interfere with same. first appellate order in this regard in thus upheld. Ground No. 2 is accordingly rejected. (5 of 5) [ ITA-139/2010] 5. Therefore, no error is said to have been committed by Tribunal in its order. 6. In that view of matter, issue is answered in favour of assessee and against department. 7. appeals stand allowed. 8. copy of this judgment be placed in each file. (VIRENDRA KUMAR MATHUR),J. (K.S. JHAVERI),J. Asheesh Kr. Yadav/62-64 Vishnu Dutt Goyal v. Commissioner of Income-tax / A.C.I.T., Central Circle, Ajmer