ACIT, Circle-1, Warangal V. Sri Konduru Narasimha Reddy, Warangal

ITA 1019/HYD/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69850 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-10-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 25-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T DIWAKAR PRASAD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.1019/HYD/13 : ASSESSMENT YEAR 2009 - 10 ASSTT. COMMISSION ER OF INCOME - TAX , CIRCLE 1, WARANGAL V/S. SHRI KODURU NARASIMHA REDDY, HANAMKONDA, WARANGAL DIST. (PAN ADFPK 0909 A) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI T.DIWAKAR PRASAD DR RESPONDENT BY : NONE DATE OF HEARING 10.10.201 3 DATE OF PRONOUNCEMENT 10.10.2013 O R D E R PER SAKTIJIT DEY, JUDICIAL MEMBER: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME - TAX(APPEALS) VI HYDERABAD DATED 26.3.2013 FOR THE ASSESSMENT YEAR 2009 - 10. 2. A T THE OUTSET, IT MAY BE NOTED THAT NONE APPEARED ON BEHALF OF THE RESPONDENT - ASSESSEE, AT THE TIME OF H E ARING ON 10.10.2013. THE NOTICE OF HEARING SENT TO THE ASSESSEE BY RPAD HAS BEEN RETURNED UNSERVED BY THE POSTAL AUTHORITIES WITH THE REMARK - INTIMATI ON DELIVERED, BUT UNCLAIMED. HENCE RETURNED TO SENDER. IN THE CIRCUMSTANCES, IT APPEARS THAT THE ASSESSEE IS NO T INTERESTED IN PURSUING THIS APPEAL OF THE REVENUE. HENCE, WE HAVE PROCEEDED WITH THE MATTER EX - PARTE QUA THE ASSESSEE, AND HEARD THE LEARNE D DEPARTMENTAL REPRESENTATIVE. WE ACCORDINGLY PROCEED TO DISPO S E OF THIS APPEAL EX - PARTE QUA THE ASSESSEE - ON THE BASIS OF THE MATERIAL AVAILABLE ON RECORD AND THE SUBMI S SION S OF THE LEARNED DEPARTMENTAL REPRESENTATIVE. ITA NO. 1019 / HYD/201 3 SHRI KODURU NARASIMHA REDDY, HANAMKONDA, WARANGAL 2 3. IT MAY FURTHER BE NOTED, AT THE OUTSET, THERE IS ONE DAYS DELAY IN THE FILING OF THIS APPEAL BY THE APPELLANT. THE APPELLANT HAS FILED A PETITION/AFFIDAVIT SEEKING CONDONATION OF DELAY. EXPLAINING THE DELAY, IT IS STATED THAT THE DELAY HAS OCCURRED ON ACCOUNT OF DELAY IN RECEIVING AUTHORIZATION FOR FILING THE APPEAL FROM THE COMMISSIONER. HAVING BEEN CONVINCED WITH THE REASON FOR THE DELAY AND CONSIDERING THE MARGINAL NATURE OF THE DELAY, WE CONDONE THE DELAY AND PROCEED TO DISPOSE OF THIS APPEAL ON MERITS. 4 . ONLY EFFECTIVE GR IEVANCE OF THE REVENUE IN THIS APPEAL RELATES TO THE RELIEF GRANTED BY THE CIT(A), OUT OF THE ADDITION MADE BY THE ASSESSING OFFICER IN THE MATTER OF ESTIMATION OF ASSESSEES INCOME FROM CIVIL CONTRACT WORKS. 5 . WE HEARD THE LEARNED DEPARTMENTAL REPRES ENTATIVE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ASSESSEE, ENGAGED IN THE BUSINESS OF EXECUTION OF CIVIL CONSTRUCTION CONTRACTS FIL E D RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009 - 10, ADMITTING AN INCOME OF RS .1,66,42,334. AS THE ASSESSEE DID N OT COMPLY WITH THE VARIOUS NOTICES ISSUED BY THE ASSESSING OFFICER, INCLUDING THE NOTICE PROPOSING TO COMPLETE THE ASSESSMENT EX - PARTE UNDER S.144 OF THE ACT, THE ASSESSING OFFICE R , ESTIMATING THE INCOME OF THE ASSESSEE AT 10% OF THE GROSS CONTRACT RECE IPTS OF RS.29,76,31,332, COMPLETED THE ASSESSMENT ON A TOTAL INCOME OF RS.3,12,86,630 VIDE ORDER OF ASSESSMENT DATED 30.12.2011 PASSED UNDER S.144 OF THE ACT. ON APPEAL, THE CIT(A) CONSIDERING THE ELABORATE SUBMISSIONS OF THE ASSESSEE ON THE ASPECT OF ESTIMATION OF INCOME OUT OF CONTRACT RECEIPTS OF THE ASSESSEE, BY THE ASSESSING OFFICER, HELD ACCEPTING THE CONTENTION OF THE AUTHORISED REPRESENTATIVE FOR THE ASSESSEE BEFORE HIM, IN THE FIRST PLACE, THAT FOR ESTIMATING THE PROFITS FROM THE CONTRACTS, THE RECOVERIES AND SENIORAGE CHARGES ARE TO BE DEDU C TED FROM THE GROSS REC E IP T S. THE CIT(A), THEREAFTER, FOLLO W IN G THE CONSISTENT VIEW TAKEN BY ITA NO. 1019 / HYD/201 3 SHRI KODURU NARASIMHA REDDY, HANAMKONDA, WARANGAL 3 THE TRIBUNAL IN SERIES OF DECISIONS , INCLUDING THE ONE IN THE CASE OF C. ESHWAR REDDY & CO. IN ITA NO.668 AND 670 /HYD/2009 DATED 31.1.2011, DIRECTED THE ASSESSING OFFICER TO ADOPT A N E T PROFIT OF RATE OF 7% IN RESPECT OF SU B CONTRACT RECEIPTS; AND ADOPTING A NET PROFIT RATE O F 8% IN RESPECT OF THE MAIN CONTRACT RECEIPTS. 6 . ON CAREFUL C ON S I D ERATION OF THE MATTER, WE FIND THAT THE ISSUE IN RELATION TO THE RATE TO BE ADOPTED FOR ESTIMATING THE PROFITS OF THE ASSESSEE FROM THE MAIN AND SUB - CONTRACT RECEIPTS IS COVERED BY SERIES OF DECISIONS OF THE TRIBUNAL IN SIMILAR MATTERS. HOWEVER, RATE AT WHICH ESTIMATION OF NET PROFIT IS TO BE MADE WOULD DEPEND UPON THE EXACT NATURE OF CONTRACT IN EACH CASE AND OTHER DISTINGUISHING F EATURES OF THAT CASE . SINCE THE IMPUGNED ORDER OF THE CIT(A) IS BASED ON THE CONSISTENT VIEW TAKEN BY THE TRIBUNAL IN SIMILAR MATTERS, AND ALSO SIN CE THE DEPARTMENT HAS NOT BEEN ABLE TO JUSTIFY WITH COGENT REASONS THAT THE NET PROFIT RATE ADOPTED BY THE CIT(A) IS NOT CORRECT, WE FIND NO INFIRMITY IN THE OR D ER OF TH E CIT(A) . WE ACCORDINGLY UPHOLD THE ORDER OF THE CIT(A), AND REJECT THE GROUNDS OF THE REVENUE IN THIS APPEAL. 7 . IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 10.10.2013 SD/ - SD/ - (CHANDRA POOJARI) ( SAKTIJIT DEY ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED/ - 10 OCTOBER, 2013 COPY FORWARDED TO: 1 SHRI KODURU NARASIMHA REDDY, H.NO.2 - 10 - 855, TEACHERS COLONY, HANAMKONDA, WARANGAL DIST. 2 ASST. COMMISSIONER OF INCOME - TAX CIRCLE 1 , WARANGAL ITA NO. 1019 / HYD/201 3 SHRI KODURU NARASIMHA REDDY, HANAMKONDA, WARANGAL 4 3 COMMISSIONER OF INC OME - TAX(APPEALS) V I, HYDERABAD 4 COMMISSIONER OF INCOME - TAX V , HYDERABAD 5 DEPARTMENTAL REPRESENTATIVE ITAT, HYDERABAD B.V.S