AJAY KUMAR SINGH GAUR,AGRA V. INCOME-TAX OFFICER, AGRA

MA 9/AGR/2021

AI Insights

The case involves Ajay Kumar Singh Gaur, the applicant, who filed a miscellaneous application under section 254(2) of the Income-tax Act, 1961, challenging the Tribunal's earlier decision in ITA No. 379/Agr/2018 for the assessment year 2013-14. The applicant contested the Tribunal's decision to reduce the net profit rate from 5% to 4% and the inclusion of duty drawback of Rs. 24,84,657 as income, which he argued led to double taxation. The Tribunal, however, found no merit in the applicant's arguments and upheld the original decision, stating that the duty drawback had been correctly added to the profit and loss account and that the reduction in net profit rate was justified to balance equity and industry trends.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 772351 (ITAT-AGRA)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-08-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Assessment Year: 2013-2014
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANIL KUMAR
• Keywords: Set aside; Rejection of books of accounts

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER AND SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER M.A. No. 09/Agr/2021 (in ITA No.379/Agr/2018) Assessment year : 2013-14 Ajay Kumar Singh Gaur, Flat-6, 1st Floor, Jagan Commercial Complex, Shashtripuram, Agra. Vs. Income-tax Officer, Ward 2(2), Agra. PAN : AELPG8055N (Applicant) (Opposite Party) ORDER PER : SUNIL KUMAR SINGH, JUDICIAL MEMBER: This miscellaneous application has been moved on behalf of the applicant assessee u/s. 254(2) of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) to set aside the order dated 31.05.2021 passed in ITA No. 379/Agr/2018 for the assessment year 2013-14. 2. The applicant assessee states that the Tribunal, vide impugned order, has reduced the NP rate of 5% to 4% on adhoc basis merely to balance the equity and trend of industries without any valid rationale, and that the NP Assessee by None Department by Sh. Anil Kumar, Sr. DR. Date of hearing 18.07.2025 Date of pronouncement 27.08.2025 Printed from counselvise.com MA No. 09/Agr/2021 2 | P a g e rate of previous years be accepted. The applicant assessee has further stated that the Tribunal has failed to acknowledge that the duty drawback had already been added as income to the profit & loss account which tantamount to double taxation, hence, wrongly added duty drawback of Rs.24,84,657/- be deleted and the impugned order be recalled. 3. None responded for the applicant/assessee. Heard the learned departmental representative, the only party in attendance. 4. We have gone through the impugned order. Applicant assessee is aggrieved with respect to the finding of the Tribunal on ground No. 1 & 3. Ground No. 1 was with respect to the addition @ 5% of turnover and ground No. 3 was with respect to addition of duty drawback amounting to Rs. 24,84,657/-. The impugned order shows that the Tribunal has made profit & loss account of the assessee as part of the impugned order with further observation that the assessee did not challenge the rejection of books of account before the Tribunal except challenging the estimation of NP rate of 5% with other grounds. Relevant paras 6 & 6 of the impugned order read as under : “6. We have heard the rival contentions. Admittedly, the assessee has not challenged the rejection of books of accounts before us and has challenged the estimation of NP rate at 5% along with other grounds. As per Profit & loss account, direct sale of assessee was mentioned as Rs.29,97,76,559/- and gross profit calculated by the assessee was Rs.4403253/- and the assessee had added thereafter duty draw back of Rs.24,84,657/- making the total of Rs.68,87,910/-. If we add, as suggested by the assessee, the sale Printed from counselvise.com MA No. 09/Agr/2021 3 | P a g e plus duty draw back then the figure would come to Rs.32462316/-. If we apply 5% of Net profit rate, it would come to Rs.16,23,115/- . In the result, the declared income of the assessee was found to be 68,87,910/- whereas if we adopt the formula as suggested by assessee it would come to Rs.16,23,115/-. 6. Undisputedly, the NP rate of assessee from previous years vary 2.49% to 1.86%. Therefore, at the best we take NP rate of 2.49%, which is NP rate for A.Y. 2011-12 or we can take 5% as proposed by the authorities below. To balance the equity, trend of industry, past NP rate of assessee and turnover of the assessee we reduce the NP rate of 5% to 4%. AO is directed to work out the income of the assessee accordingly. In the result the ground no1 of the assessee is partly allowed.” 5. The Tribunal has specifically observed that while calculating the net profit, assessee has not taken into account the duty drawback and has separately added to the net profit rate calculated by him. Accordingly, after due consideration of all the facts and arguments raised on behalf of the parties, the assessee in particular, the Tribunal has decided both the grounds No. 1 & 3 on merits against the assessee, leaving no stone unturned. Thus, there is no mistake apparent on record. The application is liable to be rejected. 6. In the result, miscellaneous application stands rejected. Order pronounced in the open court on 27.08.2025. Sd/- Sd/- (BRAJESH KUMAR SINGH) (SUNIL KUMAR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 27.08.2025 *aks/- Printed from counselvise.com MA No. 09/Agr/2021 4 | P a g e Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra Printed from counselvise.com "