JUDGMENT 1. This appeal under section 260-A of the Income Tax Act, 1961 (for short, "IT Act") has been preferred by the appellant- revenue against the order of the Income Tax Appellate Tribunal, Jaipur Bench 'B'. Jaipur (for short, "ITAT") dated 30/01/2009 passed in ITA No.1005/JP-2007 by which the ITAT has partly allowed the appeal filed by the respondent-assessee against the order of the Commissioner of Income Tax (Appeals)-II, Jaipur (for short, the "ClT(A)". The relevant assessment year is the assessment year 2002-03. 2. The brief facts, as emerging on the fact of record, are that the respondent-assessee is carrying on business of handicrafts items, sarees, bed sheets and dresses and had declared a turnover of 21360375/- declaring gross profit of Rs. 7668375/- with the gross profit rate of 35.90% and with a net profit rate of 0.46%. A survey operation was carried out at the business premises of the respondent-assessee on 08/01/2002 u/s 133A and consequent to that on account of unexplained investment and stock, the respondent-assessee surrendered an amount of Rs. 2688054/-. However, in so far as the issue relating to discrepancy, if any, during the course of survey is concerned, we are not concerned presently with the same. 3. The Assessing Officer (for short, 'AO') observed that the respondent-assessee has shown purchases to the extent of Rs. 3712314/-which is from unregistered dealers (for short, 'URD') and no whereabouts of such parties were submitted though the AO desired furnishing of complete names, addresses, PAN and confirmation etc. as also the mode of payment of such purchases. However, it is observed by the AO that the respondent-assessee did furnish names and addresses of such URD parties but failed to furnish their PAN and confirmations. The respondent-assessee failed to produce these parties for for verification of purchases made from them. Further, from the details furnished by the respondent-assessee, it was seen that the mode of payment of these URD parties was mainly in cash and furthermore, these purchases from URD parties have been found to be supported only by self made vouchers. The respondent-assessee failed to produce these parties for for verification of purchases made from them. Further, from the details furnished by the respondent-assessee, it was seen that the mode of payment of these URD parties was mainly in cash and furthermore, these purchases from URD parties have been found to be supported only by self made vouchers. The AO was of the prima-facie opinion that these purchases, being non-verifiable, therefore, there is scope for manipulation and accordingly,the trading results were rejected and after rejecting the trading results, the AO was of the opinion that since the URD purchases were not open to verification, therefore, he estimated the gross profit rate of 42% which resulted in trading addition of Rs. 1302912/-. 4. An appeal was preferred by the respondent-assessee before the CIT(A) and the CIT(A) was also not satisfied with the contention raised by the respondent-assessee that the gross profit rate as well as net profit rate is substantially better and when even after rejection of books of accounts, proper GP rate is to be applied, then when the GP rate and NP rate is better in comparison to the immediate two past assessment years, no addition is required to be made. It was also claimed by the respondent-assessee that the respondent-assessee having already surrendered more than Rs. 26.88 lacs as undisclosed income on account of unaccounted stock is also part of the trading account. It was also submitted that the claim of the AO was wrong as three parties namely, Rajendra Kumar Agarwal, Raju and Abdul Jabbar appeared before the AO and their statements were recorded who admitted and accepted the sales made to the respondent-assessee. However, the CIT(A) was not convinced and sustained the trading addition. 5. Dissatisfied with the sustenance of the trading addition, an appeal was preferred by the respondent-assessee before the ITAT reiterating the contention raised before the CIT(A), however, while the ITAT confirmed invoking of provisions of Section 145(3) but observed that in the light of the judgment rendered by this Court in the case of CIT v. Gottan Lime Khanij Udyog (2002) 256 ITR 243 , when the trading results were fair and reasonable, better in comparison to the immediate past two assessment years, then no addition was required to be made and accordingly deleted the trading addition. This order is assailed by the appellant-revenue before us. 6. Sh. R.B. Mathur, Id. This order is assailed by the appellant-revenue before us. 6. Sh. R.B. Mathur, Id. counsel for the appellant-revenue submitted that the trading results were rightly rejected by the AO as well as the CIT(A) as the assessee was unable to furnish evidence of URD purchases of more than Rs. 37 lacs and when the very nature of purchases was not forthcoming and the very purchases were itself by self made vouchers, then the apprehension of the AO was correct that the purchases are manipulated. He contended that it is on account of the survey that a huge unaccounted stock of more than Rs. 26.88 lac was found and on further verification of the accounts, even URD purchases of more than Rs. 37 lac were found by the AO. He contended that in the light of said facts reasonableness of the GP rate looses its significance J as the respondent-assessee may come out with a slightly better GP rate which should not mean that the AO is precluded from making any trading addition. He contended that several discrepancies were noticed and in the light of the said facts substantial question of law arise out of the order of the ITAT and needs consideration by this Court. 2 7. Sh. Anoop Dhand, Id. counsel for the respondent-assessee, on the other hand, submitted that the results being fair and reasonable, no addition was required to be made in the instant case. He contended that even after rejection of the trading results, ultimately one is required to see about the reasonableness of the trading results. He contended that even u/s 144, a fair, 3 reasonable and real profit or real income is required to be computed and when the respondent-assessee itself had declared much better results in-comparison to even the past years, then the ITAT was justified in deleting the trading addition. He further contended that the ITAT has deleted the addition after appreciation of evidence and when the addition has been 3 deleted after appreciation of evidence, then it is a pure finding of fact and no substantial question of law arise out of the said order. He further contended that even if the addition, which was made by the AO, is taken into consideration, then the gross profit rate comes to 42% which could not have been visualized. He further contended that even if the addition, which was made by the AO, is taken into consideration, then the gross profit rate comes to 42% which could not have been visualized. He also relied upon judgment of this Court in the case of CIT v. Gottan Lime Khanij Udhyog (supra). 8. We have considered the arguments advanced by Id. counsel for the parties and perused the impugned order. A.Y. Turnover G.P N.P G.P Rate N.P Rate 2000-01 21347844 7228088 93611 33.85% 0.44% 2001-02 28023788 10060532 105292 35.89% 0.37% 2002-03 21360375 7668375 97657 35.90% 0.46% 9. Though certainly this year, the AO had been able to locate purchases having been made from URD and in our view, it would be certainly a defect 4; and provisions of Section 145(3) are certainly applicable but even after rejecting books of accounts u/s 145(3), what is required to be seen is the reasonableness of the trading results. Real income is required to be worked out be the AO after rejection of the trading results and in our view, by and large, if the gross profit rate is better or trading results are better, then the 5( trading addition normally is not required to be made. It would be fruitful to reproduce the trading results of the respondent-assessee for the year under appeal vis-a-vis last two years:- 10. From above, it is noticed that the gross profit rate as well as net profit rate is better in comparison to the immediate past two assessment years. In our view, like is to be compared with like and in this case, neither the AO nor CIT(A) has brought any material or comparable case so as to justify about making of a trading addition or a similar circumstance of disclosing a GP rate of 42% (if the addition so made is concerned). As observed earlier, the AO, if not satisfied about the correctness or the completeness of the accounts of the respondent-assessee, he may make an assessment in the manner provided in Section 144 i.e. to say as per best of his judgment, however, in our view, it does not envisage that by resorting to best judgment assessment, the AO must reach to a different figure of income and profit and what has been disclosed by the respondent-assessee where the results are fair and reasonable. After all, an order u/s 144, which has been said to be best judgment, is also to be passed on the material available on record Section 145 only provides the basis on which computation has to be made for the purposes of determining the amount of real income and tax payable by an assessee. It does not deal with addition or deletion in the income and therefore, in our view, if some deficiency has been noticed by the AO, it does not mean that it must lead to addition in the returned income of the assessee. In our view, the ITAT, after appreciation of evidence on record, has rightly deleted the addition.11. Rejection of books of accounts, after invoking provisions of Section 145(3), is clearly a finding of fact and no substantial question arise out of the order of the ITAT. It has been held by several authorities and it would be relevant to quote a few authorities on the issue:-12. The Hon'ble Apex Court in the case of Chhabildas Tribhuvaandas Shah v. Commissioner of Income-tax, reported in (1996) 59 ITR 733 (SC) has observed as under:- "We may point out that we are not concerned with the correctness of the conclusion and we are only concerned with the question whether there is any material in support of the finding of the Appellate Tribunal in cases involving the applicability of the proviso to section t3, the question to be determined by the income-tax Officer is a question of fact namely, o whether the income profits and gains can or cannot be property deduced from the method of accounting regularly adopted by the assessee. There is nothing special about this question of fact, and generally the only question of law that can possibly arise is whether there is any material for the finding in our opinion the High Court was right in refusing to call for a ;5 statement of the case." 13. This court in the case of Commissioner of Income-tax v. Singhal Natural Stone (P) Ltd.: (2012) 21 taxmann.com 493 (Raj.) ; Commissioner of Income-tax v. Amrapali Jewels (P) Ltd.: (2012) 19 taxmann.com 207(Raj.) ; Pansari Gems International v. Commissioner of Income-tax. (2013) 33 so taxmann.com 667 (Rajasthan) ; Commissioner of Income Tax v. Dr. This court in the case of Commissioner of Income-tax v. Singhal Natural Stone (P) Ltd.: (2012) 21 taxmann.com 493 (Raj.) ; Commissioner of Income-tax v. Amrapali Jewels (P) Ltd.: (2012) 19 taxmann.com 207(Raj.) ; Pansari Gems International v. Commissioner of Income-tax. (2013) 33 so taxmann.com 667 (Rajasthan) ; Commissioner of Income Tax v. Dr. A.R Bahai (2010) 322 ITR 71 (Raj.) & Commissioner of Income Tax v. Jaimal Ram Kasturi; (2013) 33 taxmann.com 315 (Rajasthan) has also taken the same view.14. The other judgments on this point are Commissioner of Income-Tax v. Jas Jack Elegance Exports: (2010) 324 ITR 95 (Delhi) ; Arya Confectionery Works v. CIT; (1983) 143 ITR 814 (MP) and Awadhesh Pratap Singh Abdul Rehman and Brothers v. CIT: (1994) 210 ITR 406 . 15. In the totality of circumstances, the ITAT cannot be faulted in accepting the trading results declared by the assessee while not approving the gross profit rate as applied by the AO. Rejecting of books of accounts after invoking provisions of Section 145(3) is clearly a finding of fact.16. In view of the aforesaid, we find no perversity or illegality in the order of the Tribunal or from t he appreciation of any wrong principle so as to call for interference. It is essentially a finding of fact and we find no question of law, much less substantial question of law, which can be said to arise out of the order of ITAT.17. Consequently, the instant appeal, being devoid of merit, is hereby dismissed in limine. No order as to cost. *******