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Showing contexts for: turnover decrease in The Dcit 1(1), Indore vs M/S Anant Steel P Ltd, Indore on 10 March, 2021Matching Fragments
10. Ground No.2 raised by the assessee challenges the finding of Ld. CIT(A) confirming the action of the Ld. A.O rejecting the books of accounts u/s 145(3) of the Act and estimating the Net Profits.
11. Brief facts relating to this issue are that the turnover of the assessee decreased to 63.18 crores from the turnover of Rs.91.10 crores in immediately preceding year. Net Profit is also in negative at (-) 5.74% as against net profit @ 0.5% in the preceding year. On observing these facts Ld. A.O sought various information from the assessee in order to examine that whether the books of accounts have been properly maintained giving the correct results at the end of the year after considering the submissions of the assessee rejected Anant Steel Pvt. Ltd ITA No.820 & 876/Ind/2018 the book results u/s 145(3) of the Act on account of the following reasons:-
Anant Steel Pvt. Ltd ITA No.820 & 876/Ind/2018
16. We observe that Ld. A.O on noticing that the turnover of the assessee has decreased and the net profit has also decreased drastically, wanted to examine the correctness of the book results and in this process Ld. A.O examined the books of accounts and observed certain defects which in his view were sufficient to reject the book results. So in order to arrive at a conclusion that whether the case of the assessee is fit for rejecting the book results u/s 145(3) of the Act, we need to examine the correctness of the observations made by the Ld. A.O with available records before us. Therefore we will deal each of the observation one by one. 16.1 Freight expenses in connection with the scrap purchased from M/s Anant Trading Company booked in the book of the assessee company and not booked in the book of M/s Anant Trading Company.
21. Gas & Fuel was also increased from Rs. 4,03,19,812/-
to Rs.5,78,69,121/- but the assessee has not furnished any justification for the same.
21.1 Observation of Ld.A.O.
(vi) During the year under consideration the assessee company has claimed Gas &, Fuel of Rs.5,78,69,121/- whereas the same was claimed in last year of Rs.4,03,19,812/-. There is no justification of increase in this expense was found acceptable while the turnover was decreased. 21.2 Submission made by Ld. Counsel for the assessee:
The same is also placed before us. The amount of GAS & Fuel expenses have increased due to hike in the price of GAS in this year. Copy of account of Gas & Fuel in the books of account of the assessee with corresponding bills are placed before us. Month-wise Gas & Fuel consumed by the assessee and corresponding amount of bills are filed. On perusal of the same we find that there is a decrease in the consumption of gas used during the year but there is an increase in the price of gas supplied by GAIL. This fact has not been rebutted by Ld. Departmental Representative. There is increase in the gas and fuel expenses incurred by the assessee during the year even though the turnover has decreased, but the increase in price is beyond the Anant Steel Pvt. Ltd ITA No.820 & 876/Ind/2018 control of the assessee. We therefore find no reason to doubt the genuineness of gas and fuel expenses incurred during the year. This fact noticed by Ld. A.O regarding the anomaly in gas and fuel expenses has no merits.