Joginder Pall, A.M. - (1.) THIS appeal of the Revenue and cross-objection filed by the assessee arise from the order of CIT(A), Jodhpur, for the asst. yr. 1994-95. Since the issue raised in the Revenue's appeal and the cross-objection filed by the assessee arise from the same order of the CIT(A), these were heard together and are being disposed of by this consolidated order for the sake of convenience.
(2.) First we take up Revenue's appeal. The first dispute raised in this appeal relates to deletion of trading addition of Rs. 54,496. The AO observed that the assessee had shown GP of 13.85 per cent for the assessment year under reference as against GP shown at 21.19 per cent in the case of Shri Kiran Raj Solanki, proprietor of M/s Solanki AC Pipe Industries, Jalore, engaged in the same kind of business. The AO, therefore, applied the provisions of Section 145 and estimated the income by applying GP rate of 21.19 per cent as shown in other cases and thereby made a trading addition of Rs. 54,469. Aggrieved, the assessee impugned the addition in appeal before the CIT(A). It was submitted before the CIT(A) that the AO had relied on the case of Kiran Raj Solanki, proprietor of M/s Solanki AC Pipe Industries, without allowing any specific opportunity to the assessee and without asking the assessee to show cause why the same rate of GP should not be applied. Thus, the addition made was contended to be in violation of principles of natural justice. It was also pointed out that the GP shown by the assessee at 13.85 per cent was better than the GP shown at 12 per cent of the immediately preceding assessment year. It was also pointed out that the assessee had cited a case where GP of 10.22 per cent was declared and accepted by the Revenue. Thus, it was argued that the AO was not justified in making the trading addition by rejecting the book results by applying a GP rate of 13.85 per cent. Accepting the contentions of the assessee, the CIT(A) deleted the impugned addition on the ground that the AO was not correct in applying the provisions of Section 145 and in making the addition by relying on another case ignoring the vital fact that the GP shown by the assessee was better than last year. He further observed that even during the course of survey carried out by the IT authorities, no discrepancy or ho paper showing unaccounted purchases or sales was found. The Revenue is aggrieved by the order of CIT(A). Hence this appeal before us. The learned Departmental Representative simply relied on the order of the AO.
(3.) THE learned counsel for the assessee, on the other hand, heavily relied on the order of CIT(A) and reiterated all the submissions made before the authorities below.;