IN THE HIGH COURT OF DELHI AT NEW DELHI 
 . 
 . 
 . 
   ITA 362/2012  
 . 
 CIT               ..... Appellant 
 . 
 Through: Mr. Sanjeev Rajpal, Advocate 
 . 
 versus 
 . 
 . 
 . 
 AMAR UJALA PUBLICATIONS PVT LTD     ..... Respondent 
 . 
 Through: 
 . 
 CORAM: 
 . 
 HON'BLE MR. JUSTICE SANJIV KHANNA 
 . 
 HON'BLE MR. JUSTICE R.V.EASWAR 
 . 
 . 
 . 
 O R D E R 
 . 
       23.05.2012 
 . 
 . 
 . 
 This appeal under Section 260A of the Income Tax Act, 1961 is 
 directed against the order of the Income Tax Appellate Tribunal 
 (?Tribunal?, for short) dated 18.11.2011 passed in the case of M/s. Amar 
 Ujala Publication Ltd. for the assessment year 2005-06. 
 . 
 The assessee is a company engaged in the publication of newspaper 
 Amar Ujala at various places including Agra. The publication units are 
 situated at several places in U.P. In respect of the assessment year 
 under appeal, the assessee declared gross profit rate at 20.62% and net 
 profit rate of 2.80% from the business of publishing the newspaper. The 
 Assessing Officer compared the total receipts, gross profit rate and net 
 profit rate for the assessment year under appeal with the corresponding 
 figures for the earlier two assessment years and concluded that there was 
 a decline in the net profit rate which called for further probe. 
 Thereafter the Assessing Officer took up sales returns for examination 
 and found that unit-wise, the sales returns of newspapers were as 
 follows: 
 . 
 . 
 . 
 ITA 362/2012                 Page 1 
 of 3 
 . 
 . 
 . 
 Branch 
 . 
 Amount of sales 
 . 
 Sale Return (S.R.) 
 . 
 age 
 . 
 (S.R./Sales x100) 
 . 
 Agra 
 . 
 104327125/- 
 . 
 3119754/- 
 . 
 2.99% 
 . 
 Meerut 
 . 
 87862208/- 
 . 
 3325605/- 
 . 
 3.78% 
 . 
 Bareilly 
 . 
 75951264/- 
 . 
 2446986/- 
 . 
 3.22% 
 . 
 Jhansi 
 . 
 12600740/- 
 . 
 427129/- 
 . 
 3.39% 
 . 
 Allahabad 
 . 
 43914760/- 
 . 
 2844723/- 
 . 
 6.48% 
 . 
 Varanasi 
 . 
 49331790/- 
 . 
 3603080/- 
 . 
 7.30% 
 . 
 Muradabad 
 . 
 40469932/- 
 . 
 1223873/- 
 . 
 3.02% 
 . 
 Noida 
 . 
 80969490/- 
 . 
 5039219/- 
 . 
 6.22% 
 . 
 Kanpur 
 . 
 59964823/- 
 . 
 1406659/- 
 . 
 2.34% 
 . 
 Dehradun 
 . 
 67869022/- 
 . 
 3302809/- 
 . 
 4.87% 
 . 
 Panchkula/ Chandigarh 
 . 
 57282358/- 
 . 
 1909256/- 
 . 
 3.33% 
 . 
 Jalandhar 
 . 
 44818160/- 
 . 
 5010811/- 
 . 
 11.18% 
 . 
 Haldwani/Nanital 
 . 
 41048389/- 
 . 
 1131280/- 
 . 
 2.75% 
 . 
 . 
 . 
 On noticing that the sales return percentage varied between 2.34% 
 and 11.18%, the Assessing Officer held that this was on the higher side. 
 He also noted that for the earlier assessment year 2003-04, the sales 
 return of 4% was held to be reasonable. He accordingly adopted the sales 
 returns of 4.5% giving some allowance for the improved sales for the year 
 under appeal and calculated the disallowance at Rs.60,32,938/-. 
 . 
 In appeal, the CIT(A) examined the matter in great detail including 
 the entire accounting process involved right from the issue of newspapers 
 to the agents till they were returned at the gate of the publishing unit 
 and incorporated in the accounts with appropriate figures and held that 
 there was no case made out by the Assessing Officer for making the 
 addition. This order of CIT(A) has been confirmed by the Tribunal in the 
 impugned order. 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 ITA 362/2012             Page 2 of 3 
 . 
 . 
 . 
 We find that the entire issue is essentially one of fact, where the 
 accounting procedure relating to the sales returns and what would be the 
 appropriate percentage of sales returns that can be allowed has been 
 discussed threadbare by the CIT(A) whose order has been confirmed by the 
 Tribunal.  A similar, addition has been deleted by the Tribunal in 
 respect of the assessment year 2003-04 and it is stated that no appeal 
 has been filed by the revenue against the said order.  The issue being a 
 question of fact, we do not think any substantial question of law arises 
 for consideration. The appeal is dismissed without there being any order 
 as to costs. 
 . 
 . 
 . 
 . 
 . 
 R.V.EASWAR, J 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 SANJIV KHANNA, J 
 . 
 . 
 . 
 . 
 . 
 MAY23, 2012 
 . 
 rd 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 ITA 362/2012                Page 3 
 of 3 
 . 
 . 
 . 
 . 
 . 
 . 
 . 
 $ 20 
 .