Commissioner Of Income Tax, Ludhiana-Ii v. M/S. Ludhiana Industrial Corporation Dhandari Kalan, Ludhiana

IN THE HIGH COURT OF PUNJAB AND HARYANAAT CHANDIGARH I.T.A.No.594 of 2007 DATE OF DECISION: FEBRUARY 05, 2008 Commissioner of Income Tax, Ludhiana-II .....APPELLANT Versus M/s. Ludhiana Industrial Corporation Dhandari Kalan, Ludhiana ....RESPONDENT CORAM:HON'BLE MR.JUSTICE SATISH KUMAR MITTALHON'BLE MR.JUSTICE RAKESH KUMAR GARG--- Present:Mr.Sanjiv Bansal, Advocate,for the appellant... SATISH KUMAR MITTAL, J.(Oral) In this case, the Assessing Officer applied the GP rate of15.47% while taking into consideration the trading accounts of theassessee in respect of the manufacturing and trading sales. On appeal, theCommissioner of Income Tax (Appeals) reduced the said GP rate from15.47% to 12.94% while taking into consideration the goods returned bythe assessee and it was observed that if the said amount is reduced thenthe GP rate would come to 12.94%. The said order was passed by theCommissioner of Income Tax (Appeals) while taking into considerationthe material available on the record showing that the consideration of thegoods returned was Rs.2,59,756/- and if the said amount is reduced, thenthe GP rate would definitely come to 12.94%. The said finding of fact has I.T.A.No.594 of 2007 further been upheld by the Income Tax Appellate Tribunal whileobserving as under:- “17. After considering the rival submissions and the materialavailable on record, it is noticed that similar transactions hadbeen considered as benami sale proceeds in the case of sisterconcern, namely, M/s. Single & Co. by the SettlementCommission. Since the nature of transactions was identical,Ld. CIT(A) was justified in holding the deposits in the bankaccounts as sale proceeds and since the GP rate of 12.94%had been applied for the regular sales, Ld. CIT(A) wasjustified in applying GP rate of 12.94% in respect ofunrecorded sales. As regards to the working of initialinvestment is concerned, we do not see any infirmity in theobservation of the Ld. CIT(A) that generally three weeks toone month time is required for completing circle of the sale.Therefore, he was justified in directing the Assessing Officerto take into consideration three weeks' sale proceeds for thepurpose of initial investment and also to increase the same bythe applying GP rate of 12.94%. Considering the totality ofthe facts as discussed herein above, we do not see any validground to interfere with the findings of the Ld. CIT(A).” In view of the aforesaid finding of fact recorded by theCommissioner of Income Tax (Appeals) and the Income Tax AppellateTribunal, we do not find any ground to interfere in the same as in ouropinion no substantial question of law is involved in this appeal. Dismissed. (SATISH KUMAR MITTAL) JUDGE (RAKESH KUMAR GARG) JUDGE