Mr. Baljinder Singh, Fatehgarh Sahib V. ACIT, Mandi Gobindgarh

ITA 1058/CHANDI/2014

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 1554 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-09-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 28-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: FERRY SOFAT
• Section: 44AD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.1058/CHD/2014 (ASSESSMENT YEAR : 2009-10) MR.BALJINDER SINGH, VS. THE A.C.I.T., V&PO SALANA DULLA SINGH WALA, CIRCLE TEH. AMLOH, DISTT. FATEHGARH SAHIB. MANDI GOBINDGARH. PAN: ALZPS8560M (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI FERRY SOFAT RESPONDENT BY : SHRI S.K.MITTAL DATE OF HEARING : 26.08.2015 DATE OF PRONOUNCEMENT : 01.09.2015 O R D E R PER RANO JAIN, A.M . : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS), PATIALA DATED 22.9.2014 FOR ASSESSMENT Y EAR 2009-10. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE FILED THE RETURN OF INCOME ON 30.9.2009 DECLARING AN INCO ME OF RS.16,67,420/-. THE ASSESSEE FAILED TO PRODUCE VAR IOUS DETAILS DURING THE ASSESSMENT PROCEEDINGS BEFORE TH E ASSESSING OFFICER. THE NAMES AND ADDRESSES OF THE LABOURERS 2 WERE NOT GIVEN AND RATES AT WHICH THE LABOURERS WER E PAID WIDELY VARIED DURING THE MONTHS. THERE WERE NO SI TE-WISE OR CONTRACT-WISE DETAILS. NO WORK IN PROGRESS WAS S HOWN. NO PARTY-WISE DETAILS IN RESPECT OF VARIOUS EXPENDITUR E WERE SUBMITTED. IN VIEW OF ALL THESE, THE ASSESSING OFF ICER REJECTED THE BOOKS OF ACCOUNT AND ESTIMATED THE PROFIT AT 8% OF THE GROSS RECEIPTS. 3. THE ASSESSEE WENT IN APPEAL BEFORE THE LEARNED CIT (APPEALS), WHEREBY IT WAS SUBMITTED THAT THE DETAIL S OF MAJOR EXPENSES WERE DULY SUPPLIED. THERE WAS NO PERMANE NT LABOUR AND IN RESPECT OF BAZARI, RETA ETC., THE TRUCK OWNE R DID NOT MAINTAIN ANY BOOK AND, THEREFORE, THE CASH PAYMENTS WERE MADE. HOWEVER, REJECTING THE CONTENTION OF THE AS SESSEE THE LEARNED CIT (APPEALS) OBSERVED THAT ADMITTEDLY, IN THIS CASE THERE ARE NO DETAILS OF THE LABOURERS GIVEN. THE PAYMENT MADE TO THE LABOURERS ALSO WIDELY VARIED. IN VIEW OF THIS, HE WAS OF THE OPINION THAT THE BOOKS WERE RIGHTLY REJE CTED BY THE ASSESSING OFFICER AND PROFIT WAS RIGHTLY TAKEN AT 8 %. 4. NOW THE ASSESSEE HAS COME UP IN APPEAL BEFORE U S RAISING THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE ORDER OF THE LEARNED C.I.T.(A) IS AGAI NST THE FACTS OF THE CASE AND IS BAD IN LAW. 2. THAT ON THE FACTS & CIRCUMSTANCES OF THE CASE, T HE LEARNED A.O. HAS ERRED IN REJECTING THE AUDITED BOO KS OF ACCOUNTS AND APPLYING RATE OF 8% AS PRESCRIBED U/S 44AD OF THE INCOME TAX ACT, 1961, TO THE ASSESSEE ENGAGED IN ROAD CONSTRUCTION BUSINESS. 3 3. THAT ON THE FACTS & CIRCUMSTANCES OF THE CASE, T HE LEARNED C.I.T.(A) HAS ERRED IN CON FIRMING THE NET RATES OF 8% APPLIED BY THE A.O. ON CONTRACT RECEIPT S AND CONFIRMING ADDITION OF RS.900121/- MADE BY THE A.O. BASED ON RATE APPLICABLE TO SMALL CONTRACTORS AS PRESCRIBED U/S 44AD OF THE INCOME TAX ACT, 1961. 4. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR DELETE ANY OF THE GROUNDS OF APPEAL BEFORE THE SAME IS FINALLY HEARD & DISPOSED OFF. 5. THE LEARNED COUNSEL FOR THE ASSESSEE, DURING TH E COURSE OF HEARING, MADE SUBMISSIONS TWO FOLD. HIS FIRST CONTENTION WAS THAT REJECTION OF BOOKS BY THE ASSES SING OFFICER IS NOT RIGHT. THE ONLY REASON BEFORE THE A SSESSING OFFICER TO REJECT THE BOOKS OF ACCOUNT WAS THAT TH ERE WERE CERTAIN DISCREPANCIES IN THE LABOUR SCROLLS. MERE LY THERE BEING NO ADDRESSES OF THE LABOUR IN THE LABOUR SCRO LL AND SCROLL BEARING JUST THE THUMB IMPRESSION CANNOT BE THE BASIS FOR REJECTION OF BOOKS OF ACCOUNT. ALTERNATIVELY, IT WAS SUBMITTED THAT THE ESTIMATION OF G.P. @ 8% IS TOO E XCESSIVE IN VIEW OF THE PAST HISTORY OF THE ASSESSEE. 6. THE LEARNED D.R. RELIED UPON THE ORDER OF THE AUTHORITIES BELOW. AS PER HIM, THE ASSESSEE HAD F AILED TO PRODUCE ANY DETAIL BEFORE THE LOWER AUTHORITIES. E VEN AT PRESENT, THE LEARNED COUNSEL FOR THE ASSESSEE IS MA KING BALD SUBMISSIONS. IN VIEW OF THIS, IT WAS SUBMITTED TH AT THE BOOKS WERE RIGHTLY REJECTED BY THE ASSESSING OFFICER AND THE G.P. WAS RIGHTLY COMPUTED @ 8%. FOR THIS, A GIST OF VARIOU S JUDGMENTS INCLUDING THAT OF THE CHANDIGARH BENCH OF THE ITAT AND THE 4 JURISDICTIONAL PUNJAB & HARYANA HIGH COURT WERE ALS O FILED, WHEREBY A G.P. RATE OF 8% OR ABOVE WAS HELD TO BE R EASONABLE IN SUCH CIRCUMSTANCES. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ASSESSING O FFICER HAS GIVEN PLAUSIBLE REASONS FOR REJECTING THE BOOKS OF ACCOUNT. THE ASSESSEE HAS NOT BEEN ABLE TO FURNISH THE MATER IAL AS ASKED FOR BY THE ASSESSING OFFICER. HE HAS NOT BE EN ABLE TO SUBSTANTIATE THE LABOUR PAYMENTS. THE FINDINGS GI VEN BY THE LOWER AUTHORITIES HAVE NOT BEEN REBUTTED BY THE ASS ESSEE AT ANY STAGE. EVEN BEFORE US, THE STATEMENT WAS MAD E WITHOUT ANY CORROBORATIVE EVIDENCE. THEREFORE, CONSIDERING THE FINDING GIVEN BY THE ASSESSING OFFICER AS WELL AS BY THE LE ARNED CIT (APPEALS), WE DO NOT FIND ANY INFIRMITY IN THE ORDE R OF THE LEARNED CIT (APPEALS) IN CONFIRMING THE ACTION OF T HE ASSESSING OFFICER IN REJECTING THE BOOKS OF ACCOUNT . 8. ONCE, CONFIRMING THE REJECTION OF BOOKS, THE ON LY ISSUE REMAINS IS THE QUANTUM OF G.P. UNDISPUTEDLY , IN SUCH A CASE AN ESTIMATION OF THE G.P. HAS TO BE MADE. FROM THE PERUSAL OF CHART FOR G.P. OF THE ASSESSEE DECLARED IN EARLIER YEARS, AS REPRODUCED AT PAGE 2 OF THE ASSESSING OFF ICERS ORDER, IT IS SEEN THAT THE SAME VARIES BETWEEN 1.74 % TO 35.89%, WHICH IS A VERY HUGE VARIATION. ON PERUSA L OF THE CASES RELIED UPON BY THE LEARNED D.R., IT IS SEEN T HAT THE CHANDIGARH BENCH OF THE ITAT AND PUNJAB & HARYANA H IGH COURT IN SUCH CASES HAVE APPLIED AT A RATE 8% OR AB OVE. WE, THEREFORE, CONSIDERING THE OVERALL PICTURE OF THE C ASE, FIND 8% 5 AS ADOPTED BY THE ASSESSING OFFICER AND CONFIRMED B Y THE LEARNED CIT (APPEALS) TO BE REASONABLE AND APPROPRI ATE. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 1 ST DAY OF SEPTEMBER, 2015. SD/- SD/- (BHAVNESH SAINI) (RANO JAIN) JUDICIAL MEMBER ACOUNTANT MEMBER DATED : 1 ST SEPTEMBER, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH