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6.1 Secondly, the AO failed to take into consideration the detailed submissions of the Assessee. Firstly, the nature and content of the business of the Assessee had changed over the years, in the process of which the Assessee laid more stress on its own manufacturing activities in place of job work. Because of the several expenses which is required to be incurred in connection with the manufacturing activity, it is a known fact that the margin is always lower In manufacturing than It is in job work, The bills raised against the job work are inclusive of all expenses Asst. Year 2004-05 plus the desired profit margin. Therefore, it was natural that the gross profit margin of the Assessee would have reduced over the years, as the Assessee reduced its job work business. This would have been the case, in spite of the job work receipts In absolute terms being more during the year under consideration than in the preceding years. The AO also ignored the Assessee's claim that its cost of production had increased because of the increase in the purchase price of POY yarn as also of oil Even though the cost of power and Fuel had gone down only as a percentage of the turnover which had increased, there was no decrease In absolute terms. Without taking all these facts into consideration, the AO simply came to the conclusion in a very summary manner that the fall in the GP ratio was not satisfactorily explained. Even if it was so, there was no case for making any lump sum addition. He ought to have given a finding as to what should have been the appropriate GP ratio for the year. Given such facts of the case, I am of the view that there was simply no case For the AO to make any addition to the gross profit, especially when, he had not rejected the book results, The addition of the sum of Rs. 2 lacs will therefore, stand deleted."