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The net profit ratio has dipped to (-) 0.3% from 2.71% for the corresponding period. The major reason for fall in G.P. & N.P. has been attributed to continuous increase in cost of material without proportionate increase in the selling price cost the stiff competition in the market and also due to tremendous increase in finance cost. The relevant chart showing the increase or decrease net profit due to the various factors as noted in the remand report is reproduced below :

Page | 10 Particulars Financial Year Average of FY Factor for 2011 -12 2008 - 09 to Increase / 2010-11 decrease in Net Profit Turnover net of Excise 2,954,466,905 2,206,868,948 2,182,361,822. 1,553,483,254 Total cost of raw material consumed and purchase of traded goods % over Turnover 73.87% 70.39% 3.47%o Other Manufacturing / Operating 402,978,643 294,601,388 cost % over Turnover 13.64% 13.35% 0.29% Other Expenses 523,418,909 359,513,497 % over Turnover 17.72% 16.29% 1.43% Total decrease in Net Profit 5.19% Less: Other Income 145,496,732 60,492,763 % over Turnover 4.92% 2.74% 2.18% Net decrease in net profit during 3.01% the year 4.1.8 It has also been submitted that the company was unable to handle the competition in the marked due to huge financial cost and therefore, it had ultimately sold off its beverage business under slump sale in January, 2013 i.e. the next year. It has also been submitted keep the promise made evidences in respect of undisclosed sale/ bogus expenses that surrender of Rs. 3,37,59,400/- has been made only to by the promoters/director even though no incriminating evidences in respect of undisclosed sale/ bogus expenses etc. were found in the appellant's case. It has also been pointed out that even the AO has not brought on record any incriminating evidences in the assessment order. 4.1.9 It is noted here that the A.O. has completed the assessment without seeking any explanation for fall in GP/NP ratio from the appellant. During the appellant proceedings, the justification/explanation provided by the assessee has been examined by the A.O. with regard to the books of account. He has not found any discrepancies nor raised any counter grounds.