B.S. Saluja, J.M. - (1.) THE assessee is in appeal against the consolidated order of the CIT(A), Jodhpur, dt. 11th Oct., 1995, for the asst. yrs. 1991-92 and 1992-93. ITA No. 2091/Jp/95
(2.) In the asst. yr. 1991-92 the AO applied a net profit rate of 10.5% on total receipts of Rs. 32,59,091. The AO also did not allow the claim of the assessee for depreciation and interest paid to third parties. The assessee had declared G. P. rate of 8.31% during this year. 2.1. On first appeal, the counsel of the assessee submitted that the AO has not allowed 100% depreciation on hutments as claimed by the assessee in the asst. yr. 1991-92. The learned CIT(A) observed that the AO had applied the net profit rate of 10.5% and has observed that the same takes care of the depreciation claimed by the assessee. He, therefore, agreed with the AO in principle. However, keeping in view the rise in the price index of various inputs, the learned CIT(A) allowed a lumpsum relief of Rs. 50,000 to the assessee. The learned counsel for the assessee Shri Suresh Ojha invited our attention to the written submissions filed before the learned CIT(A), wherein attention of the learned CIT(A) was invited to the decisions by the Tribunal in the case of M/s Tolaram Phusaram, Bikaner, and Shri Poonam Chand Acharya, Bikaner, where G. P. rates of 8% and 7% were found reasonable in the case of contractors maintaining no books of account. In the said written submissions it was further mentioned that the case of the assessee was rather well placed because the books of accounts were there and, therefore, it was contended that the AO should not have applied higher rate than in the cases in which no books of accounts were maintained. It was further submitted that during the year under consideration the prices of diesel were substantially higher on account of Gulf war. It was also contended that even in the case of assessee in the preceding year a rate of 10% was applied when the assessment was completed under s. 143(3). The assessee also referred to the case of M/s Ajmera Singh & Co. wherein a rate of 9.06% was held to be reasonable. The learned counsel further submitted that the main reason for the addition was that according to the AO the household expenses of the partners were too low as there were hardly any withdrawals and, therefore, the addition made also took into account the low withdrawals for household expenses. The learned counsel also submitted that in this year the returned income by the assessee was Rs. 1,84,736 and that after the appeal effect the assessed income comes to Rs. 1,87,330 and that only an addition of Rs. 2,594 is sustained by the learned CIT(A), which looking to the facts of the case should not have been sustained.
(3.) THE learned Departmental Representative Shri A. K. Singh strongly refuted the submissions made by the learned counsel and submitted that the main reason given by the AO related to maintenance of the books in improper manner and that it was a clear case of application of the provisions of s. 145 of the Act. He submitted that the low withdrawals by the partners was only one aspect for making the additions. THE learned Departmental Representative further submitted that the assessee could not produce any vouchers with reference to the expenses claimed and that even the purchase of coal, etc. were unvouched. He further submitted that the cases mentioned by the learned counsel were distinguishable on facts. He, therefore, submitted that there should be no interference with the orders of the first appellate authority.;