GNG Exports vs. ACIT, Circle-33, Kolkata

Parties Involved

Facts Summary

The assessee, GNG Exports, appealed against the order of the National Faceless Appeal Centre (CIT(A)) which estimated the net profit of the assessee at 0.77% of the total turnover. The Assessing Officer had rejected the books of account of the assessee due to non-compliance/non-service of notices issued to sundry creditors under section 133(6) of the Income Tax Act. The CIT(A) accepted the alternate contention of the assessee to determine the net profit based on the average of the last three years, which was 0.77% of the total turnover. The assessee argued that the CIT(A) was not justified in estimating the profits at 0.77% of the total turnover as it contradicted the earlier finding that the rejection of the books of account was not justified. The tribunal dismissed the appeal, holding that the CIT(A) had not erred in its order.…

Legal Issues

• 1. Whether the CIT(A) was justified in estimating the net profit at 0.77% of the total turnover?
• 2. Whether the assessee could establish the genuineness of the transactions?

Judgment Outcome

Decided in favour of Assessee.

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