- (1.) This appeal under section 260-A of the Income Tax Act has been filed against the order and judgment dated 17.01.2002 passed by the Income Tax Appellate Tribunal, Lucknow in I.T.A. No.450 (Alld.) of 1994.
(2.) On 17.03.2010, a Coordinate Bench of this Court has admitted the present appeal on the following substantial questions of law: 1.Whether the Tribunal has committed substantial illegality by not considering the grounds raised by the appellant in terms of objection filed before the Assessment Authority? 2.Whether the Tribunal has committed substantial illegality by relying upon the material of assessment of previous year though, no reliance could have been placed on the material of assessment of previous year?
(3.) The brief facts of the case are that the assessee is a registered firm and engaged in manufacturing and sale of Khandsari sugar. During the assessment year under consideration, the assessee filed return of income showing total loss of Rs.2,92,480/=. During scrutiny, the A.O. found that during assessment year under consideration, the G.P. rate was shown at Rs.16.20% in comparison to last year, where it was 33.44%. Further, the A.O. found that there were various discrepancies in the books of accounts such as no proper vouchers were maintained, no stock register for gunny bags, diesal consumption as well as consumable stores like sulpher, salt and lime etc. were not open for proper verification. In these circumstances, the A.O. has applied section 145(2) of the I.T. Act and rejected the books of accounts. Finally, the A.O. estimated the sale and also estimated the G.P. rate on the basis of immediate previous year and applied G.P. rate @ of 27% and made the addition of Rs.8,70,365/=.;