MURARI LAL & SONS(HUF), Kota V. ITO, Kota

ITA 1029/JPR/2013

• Counselvise Citation: 102923114 RSA 2013
• Duration Of Justice: 1 year(s) 11 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 30-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA JCIT DR DHK
• Assessee Lawyers: B V MAHESHWARI

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JUDICIAL MEMBER VK;DJ VIHY LA-@ ITA NO. 1029/JP/2013 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2007-08 SHRI MURARI LAL & SON (HUF ) 51-A, TALWANDI KOTA CUKE VS. THE ITO WARD- 1 (2) KOTA LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABHM 1895 A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI B.V. MAHESHWARI, CA JKTLO DH VKSJ LS@ REVENUE BY :SHRI RAJ MEHRA, JCIT-. DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 02/12/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 2/12/2015 VKNS'K@ ORDER PER R.P. TOLANI, JM THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A), KOTA DATED 29-11-2013 FOR THE ASSESSMENT YEAR 2007 -08 RAISING THEREIN FOLLOWING GROUNDS:- 1. THAT THE LD AO GROSSLY ERRED IN REJECTING THE BOOKS OF ACCOUNT AND INVOKING SECTION 145(3) OF THE ACT. FURTHER MORE THE LD. CIT(A) ALSO ERRED IN CONFIRMIN G THE ORDER OF LD. AO ON THIS GROUND. 2. THAT THE LD AO GROSSLY ERRED IN ESTIMATING THE GROSS PROFIT @ 20.14% WHICH IS REDUCED TO 185 BY TH E LD. CIT(A). AS SUCH THE LD. AO MADE THE ADDITION OF RS. ITA NO. 1029//JP/2013 SHRI MURARI LAL & SONS (HUF ) VS. ITO , WARD- 1(2), KOTA . 2 1,93,749/- WHICH IS RESTRICTED TO RS. 83,364/- BY T HE LD. CIT(A). THE APPELLANT HAS MAINTAINED THE BOOKS OF A CCOUNT AND ALSO SHOWN FAIR N.P. HENCE, ADDITION IS WRONGLY MADE AND SUSTAINED. 2.1 APROPOS GROUND NO. 1, THE LD. COUNSEL CONTENDS THAT ASSESSEE IS DEALING IN THE JEWELERY TRADE, BOOKS OF ACCOUNTS AN D STOCK DETAILS ARE MAINTAINED AS PER PAST PRACTICE. NO SPECIFIC DEFECT S IN THE BOOKS OF ACCOUNT ARE POINTED OUT BY LD. AO. THE STOCK DETAIL S ARE MAINTAINED ON THE BASIS OF WEIGHT AND NOT ON THE BASIS OF ITEM WI SE JEWELLERY, WHICH IS IMPOSSIBLE TO MAINTAINED. AO ON THIS VAGUE BASIS RE JECTED THE BOOKS OF ACCOUNTS. THEREFORE, REJECTION OF BOOKS OF ACCOUNT IS UNCALLED FOR. 2.2 APROPOS GROUND NO. 2, THE LD. COUNSEL FOR THE A SSESSEE CONTENDS THAT AVERAGE GROSS PROFIT FOR PRECEDING TWO YEARS W ORKS OUT TO AROUND 16% AS AGAINST ASSESSEE HAS SHOWN THE GROSS PROFIT RATE AT 15.16%. A MINOR INCREASE IN THE GROSS PROFIT RATE CANNOT RESU LT INTO ANY ESTIMATION OF GROSS PROFIT. 2.3 THE LD. DR IS HEARD. 2.4 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN MY CONSIDERED VIEW, THERE I S NO VALID JUSTIFICATION IN REJECTING ASSESSEE'S BOOKS OF ACCOUNT AS MAINTEN ANCE OF STOCK IDENTIFYING EACH ITEM OF JEWELLERY BY DESCRIPTION I S NOT POSSIBLE. THE ITA NO. 1029//JP/2013 SHRI MURARI LAL & SONS (HUF ) VS. ITO , WARD- 1(2), KOTA . 3 ASSESSEE HAS MAINTAINED STOCK BY WEIGHT AS PER PAST PRACTICE, WHICH IS ACCEPTABLE IN JEWELLERY TRADE. BESIDES, THE ASSESSE E HAS DISCLOSED THE GROSS PROFIT RATE AT 15.16% WHICH NEARLY CARRIES TO GROSS PROFIT RATE OF 16% AND IT IS AVERAGE TO PAST HISTORY. THEREFORE, T HERE IS NO JUSTIFICATION IN ESTIMATING THE GROSS PROFIT RATE. IN VIEW THEREOF, BOTH THE GROUNDS OF THE ASSESSEE ARE ALLOWED. 3.0 IN THE RESULT, ASSESSEE'S APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 /12 /2015 SD/- VKJ-IH-RKSYKUH (R.P.TOLANI) U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 2 /12/ 2015 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI MURARI LAL & SONS (HUF ) KOTA 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 1(), KOTA 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 1029/JP/2013) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR