Books Rejected for Absence of Stock Register and Abnormal Cash Sales: ITAT Upholds Rejection and Confirms 5% Profit Estimation u/s 145(3)

The ITAT (Income Tax Appellate Tribunal) has upheld the rejection of a taxpayer's books of account for the "absence of a stock register and abnormal cash sales," confirming a "5% profit estimation under Section 145(3)." The tribunal found that without a proper stock register, the tax authorities were justified in rejecting the books of accounts. The ITAT also found that the estimated profit rate was reasonable given the facts of the case, thereby protecting the revenue from being impacted by unsubstantiated business claims and reaffirming the importance of maintaining proper records.