INCOME TAX OFFICER WARD-2, CHANDRAPUR V. JANARDAN SHYAM BIHARI SINGH, CHANDRAPUR

ITA 550/NAG/2024

AI Insights

The case involves an appeal by the Revenue against the order of the learned CIT(A), which had favored the assessee, Janardhan Shyam Bihari Singh, a civil contractor. The dispute centered on the appropriate rate of net profit to be applied on the assessee's gross receipts from contract work, where the Assessing Officer had applied a 15% rate due to non-filing of the return, while the CIT(A) reduced it to 8.5%, aligning with the assessee's declared rate. The Tribunal agreed with the CIT(A)'s decision, dismissing the Revenue's appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 32311 (ITAT-NAGPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHAY Y. MARATHE
• Assessee Lawyers: MAHAVIR ATAL
• Keywords: TDS

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL NAGPUR “SMC” BENCH : NAGPUR BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER ITA.No.550/NAG./2024 [E-APPEAL] Assessment Year 2013-2014 The Income Tax Officer, Ward-2, Aaykar Bhawan, Hal Nagar Ward, Near Railway Station, CHANDRAPUR – 442 401. Maharashtra. vs. Janardhan Shyam Bihari Singh, Ganesh Nagar, Near Carmel Academy D.O.C. Road, Tukum, CHANDRAPUR – 442 401. Maharashtra. PAN AFPPS7844J (Appellant) (Respondent) For Revenue : Shri Abhay Y. Marathe, Sr. DR For Assessee : Shri Mahavir Atal, C.A. Date of Hearing : 23.01.2025 Date of Pronouncement : 05.02.2025 ORDER PER V. DURGA RAO, J.M. : This appeal has been filed by the Revenue against the order dated 27.08.2024, of the learned Addl./JCIT(A)-1, Noida, relating to assessment year 2013-2014. 2. Briefly stated facts of the case are that the assessee is a civil contractor and doing contract work at Dhariwal Infrastructure Ltd., and GMR & Pune Llyod Ltd., During the F.Y. 2012-2013, the assessee had got the receipts 2 ITA.No.550/NAG./2024 from contract work for Rs.1,10,19,071/- against which TDS amount of Rs.1,46,315/- has been deducted. The assessee had get his books audited in time and declared income of Rs.9,36,621/- i.e., @ 8.5% on gross receipts in the income and expenditure account. The assessee did not file his return of income. Therefore, the Assessing Officer determined the income out of gross receipts @ 15% and determined the income of the assessee at Rs.16,52,860/- and passed ex- parte order u/sec.144 r.w.s.147 of the Act vide order dated 23.12.2018. 3. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the learned CIT(A) and the learned CIT(A) allowed the appeal of the assessee. 4. Aggrieved by the order of the learned CIT(A), the Revenue is in appeal before the Tribunal. 5. During the course of hearing, the Learned DR relied on the order of the Assessing Officer. He submitted that that the assessee did not file his return of income during the previous year and for the impugned assessment year also. In 3 ITA.No.550/NAG./2024 absence of filing of return and producing sufficient documentary evidence as called for by the Assessing Officer, the impugned estimate of net profit @ 15% by the Assessing Officer is justified and pleaded that the order of the Assessing Officer be confirmed. 6. I have heard the arguments made by both the parties and perused the material on record. I find that there is no dispute between the parties that the assessee is a civil contractor and had not filed his return of income for the impugned assessment year. In absence of filing of return and not appearing before the Assessing Officer nor filing any documentary evidence, the Assessing Officer passed his ex- parte assessment order u/sec.144 r.w.s.147 of the Act. However, I find that while estimating the net profit of the assessee @ 15%, the Assessing Officer is not justified. Further while passing ex-parte assessment order, the Assessing Officer must have make a rational and fair assessment but not making arbitrary estimations/additions. Since, the assessee had fairly offered net profit @ 8.5%, which is generally in the line of civil contract work, the learned CIT(A) 4 ITA.No.550/NAG./2024 rightly accepted the estimation of net profit @ 8.5%. I, therefore, find no infirmity in the order of the learned CIT(A) and accordingly I confirm the same. Accordingly, the grounds raised by the Revenue are dismissed. 7. In the result, appeal of the Revenue is dismissed. Order pronounced in the open Court on 05.02.2025. Sd/- (V. DURGA RAO) JUDICIAL MEMBER Nagpur, Dated 05th February, 2025 VBP/- Copy to 1. The appellant 2. The respondent 3. The CIT(A), Nagpur concerned 4. The CIT, Nagpur concerned 5. The D.R. ITAT, Nagpur SMC-Bench, Nagpur 6. Guard File. //By Order// True Copy Sr. Private Secretary : ITAT : Nagpur Bench NAGPUR. "