correspondence
expenses has not decreased. The assessing officer has worked out the
increase in expenses to 191% and decrease in the turn over ... this regard, the assessee has explained that the
turnover of the assessee has been decreased from 92 crore to 29 crore,
however, fixed nature
year under
consideration the gross turnover of the assessee has been reduced to Rs.
629.82 lacs compared to gross turnover of 863.12 lacs to preceding ... lacs to Rs. 20.73 lacs in spite of decrease in the turnover of the asssessee.
Therefore, the assessing officer has asked the assesse to justify
year-wise detail of investments in shares,
reserve and surplus, business turnover, other income and net profit
from financial year 2002-03 to financial year ... crores in FY 2005-06; whereas business turnover has drastically
decreased from Rs.3 crores in FY 2002-03 to Rs.0.64 crores
preceding year but there is decrease
in the turnover and therefore, this is the objection of learned CIT that the
overall turnover shown
year
under reference is on higher side whereas total turnover has been
decreased to 90% from last year. (Last year turnover
However, keeping in view the fact that the assessee's turnover has
been increased from ... will be justified. It is well settled that when turnover
increases, margin of profit decreases. The rate of GP in the immediate
preceding assessment year
other contentions regarding decrease in direct cost to the extent of Rs.193.41 lakh and
increase in total turnover etc. were never made before ... verification regarding these two claims in connection
with decrease in direct cost and increase in total turnover.
5. We have considered the rival submissions, perused
years ranging
from 37.64% to 43.04%. The AO observed that though the turnover of
the assessee declined by 17% vis-a-vis the preceding year ... relevant material on
record, it is noticed that though the turnover of the assessee decreased in
comparison with the preceding year, the Assessing Officer
through
a substantial downfall which is reflected by the sale turnover and has decreased from
reduced.
ii. That during the year under consideration out of total turnover,
the turnover of Rs. 30,26,21,654/- was in the nature ... rate was due to various factors such as
increased turnover, tough competition in market, decreasing profit
margin etc. I find some force in the appellant
