Rajesh Balia, J.
1. Heard learned counsel for. the appellant. In spite of service no one present for the respondents.
2. This appeal is directed against the order of Tribunal, Jodhpur Bench, Jodhpur, dt. 27th Oct., 2003. The substantial question of law framed at the time of admission for consideration in this appeal is as under :
'Whether, on the facts and in the circumstances of the case, the Tribunal was justified in deleting the additions which have been made after invoking the proviso to Section 145 of the Act and whether the finding of the learned Tribunal is perverse ?'
3. The facts of the present case are that the assessee-respondent is a liquor contractor for wholesale and retail sale for both country liquor and Indian made foreign liquor. The assessee has submitted his return for asst. yr. 1993-94 showing his total income as 18,27,180 as per P&L; a/c which was reduced (increased) to Rs. 22,73,630 while issuing intimation under Section 143(1)(a) after making certain adjustment.
4. During the course of regular assessment, the AO found that while purchases of country liquor as well as Indian made foreign liquor are duly vouched, the verifiable retail sales remain totally unvouched, the result shown by the assessee cannot be accepted. He thereafter rejected the books of account and resorted to Section 145(2) of the IT Act, 1961, and the best judgment assessment was made. The AO made certain additions in the total income from business of country liquor as well as Indian made foreign liquor. While assessing the income of the firm, profits and gains for the business of country liquor, the AO resorted to apply net profit (NP) rate on the turnover which he determined on the basis of purchase price of the country liquor by applying the NP rate. The NP rate was determined by the AO on the basis of NP shown by a dealer of another area. On the other hand, additions in profit and gains from Indian made foreign liquor were made by applying GP rate on total purchase price. However, after applying GP rate, no exercise for adjustment of allowable expenditure was made.
5. On appeal, CIT(A) was of the opinion that so far as order of rejection of books of account and resort to best judgment assessment was concerned, the order of AO does not call for interference. However, the CIT(A) was of the opinion that illustration picked up by the AO for applying the NP rate and GP rate, respectively, was not apt and held that additions made in the income declared by the assessee were excessive. He held that the assessee's past record itself shows the better basis. He, therefore, gave relief to assessee by reducing the income assessed by the AO from both businesses by lump sum amount in each case.
6. On further appeal, the Tribunal deleted entire additions made by the AO, though he sustained the order rejecting the books of account. It was the obligation of the AO to have brought on record cogent and relevant material to justify the application of GP rate and NP rate applied by him. In absence of any material having been produced by the AO, the results declared by the assessee which are better than the previous year ought to have been accepted.
7. The facts of the present case are almost similar to the facts in the case of CIT v. Sunil Talwar Murlidhar & Party which was subject-matter of DB IT Appeal No. 48 of 2004 decided on 30th March, 2005.
It was noticed by the Court in the decision of DB IT Appeal No. 48 of 2004, CIT v. Sunil Talwar Murlidhar & Party (supra) that rejection of books of account was only on the ground that-retail sales were duly vouched and not verifiable and the AO had resorted to best judgment assessment by ignoring the turnover shown by the assessee, the Tribunal has founded its decision on the premise that turnover shown by the assessee could not be accepted and GP rates shown on such unacceptable turnover be accepted. Tribunal's, acceptance of such income on the rejected basis cannot be sustained. The Court was of the opinion :
'In our opinion, on the face of it, it is contradictory in terms that the very foundation on which the books of account rejected by the AO and which order has been affirmed by the Tribunal, should be taken to be the basis of accepting the assessee's results because no material was produced by the AO. It is to set at naught the initial presumption which at least shifted the burden on the assessee to prove that results declared by his books of account are still correct. The burden of proving exact facts to sustain the additions made on best judgment with definiteness is to convert best judgment, which is in the very nature a guesswork, to an assessment in accordance with rejected books of account to a definiteness. The Tribunal has failed to consider the undisputed and unquestionable fact on which the AO has proceeded to make the assessment, even the fact was not disputed by the assessee that cost price was verifiable for carrying the guesswork Therefore, in our opinion, the decision of the Tribunal in deleting the additions made by the AO as reduced by the CIT cannot be sustained in law.'
8. The principle fully governs the facts of the present case also. The Court after considering that no criteria emerges from the order of the AO in adopting different basis for best judgment assessment in the case of country liquor and Indian made foreign liquor and not giving any deductions in the GP, the matter requires reconsideration and remitted the case back to the Tribunal for deciding the appeal afresh in accordance with law.
9. Following the aforesaid decision, we allow this appeal. The judgment of the Tribunal is set aside. The case is remitted back to the Tribunal for deciding afresh in accordance with law.
No order as to costs.