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The Tax PublishersITA No. 117/Srt/2017
2021 TaxPub(DT) 2769 (Sur-Trib)INCOME TAX ACT, 1961
Section 145(3)
AO failed to point out any serious defect in maintenance of books of account, except comparing Gross Profit Ratio of preceding years and making fall in GP ratio as main basis for rejection of books results. There was no change in method of accounting. There was no material brought on record to prove that purchases and expenses were inflated or sales were suppressed. Accordingly, rejection of assessee's books was not justified.
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Accounting method - Rejection - Fall in gross profit ratio - No other discrepancy pointed out by AO
AO rejected assessee's books of account on the ground that assessee failed to prove reasons for fall in GP with supporting evidences. Held: AO failed to point out any serious defect in maintenance of books of account, except comparing Gross Profit Ratio of preceding years and making fall in GP ratio as main basis for rejection of books results. There was no change in method of accounting. There was no material brought on record to prove that purchases and expenses were inflated or sales were suppressed. Accordingly, rejection of assessee's books was not justified.
Relied:CIT v. Vikram Plastics & Ors. (1999) 239 ITR 161 (Guj.) : 1999 TaxPub(DT) 0810 (Guj-HC)
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
INCOME TAX ACT, 1961
Section 195
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