Appeal details
Counselvise Citation
[2014] 140 COUNSELVISE.COM (IT) 78335 (ITAT-KOLKATA)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 10 month(s) 4 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
27-05-2014
Appeal Filed By
Assessee
Order Result
Partly Allowed
Bench Allotted
B
Assessment Year
2008-2009
Appeal Filed On
23-07-2012
Judgement Text
I.T.A. NO.: 1093/KOL./20 12 ASSESSMENT YEAR : 2008-200 9 1 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA B BENCH, KOLKATA CORAM : SHRI ABRAHAM P. GEORGE (ACCOUNTANT MEMBER) AND SHRI GEORGE MATHAN (JUDICIAL MEMBER) I.T.A. NO.: 1093/KOL./ 2012 ASSESSMENT YEAR : 2008-2009 RAJIB RANJAN KUMAR SINHA,.......................... .............APPELLANT OLD COURT MORE, DURGAPUR-713 203 [PAN : ARGPS 2409 C] -VS.- INCOME TAX OFFICER,................................ ...............RESPONDENT WARD-1(2), DURGAPUR APPEARANCES BY: SHRI U. DASGUPTA, ADVOCATE, FOR THE ASSESSEE SHRI DAVID Z. CHAWNGTHU, ACIT, SR. D.R, FOR THE DEP ARTMENT DATE OF CONCLUDING THE HEARING : MAY 26, 2014 DATE OF PRONOUNCING THE ORDER : MAY 27, 2014 O R D E R PER ABRAHAM P. GEROGE : 1. IN THIS APPEAL FILED BY THE ASSESSEE, IT IS AGGR IEVED THAT UNDISCLOSED CONTRACT RECEIPT OF RS.7,26,124/- WAS CONSIDERED AS SUCH HIS INCOME. AS PER THE ASSESSEE ONLY PERCENTAGE OF SUCH CONTRACT R ECEIPT OUGHT HAVE BEEN CONSIDERED AS INCOME. 2. FACTS APROPOS OF THE CASE ARE THAT ASSESSEE, A C ONTRACTOR, FILED HIS RETURN FOR THE IMPUGNED ASSESSMENT YEAR DECLARING I NCOME OF RS.4,32,670/-. DURING THE COURSE OF ASSESSMENT PROC EEDINGS, ASSESSING OFFICER NOTED FROM THE INFORMATION MADE AVAILABLE B Y CENTRAL INFORMATION BUREAU THAT ASSESSEE WAS HAVING CONTRACT RECEIPTS O F RS.7,26,124/- FROM ONE M/S. SHREE RAMRUPAI BALAJI STEELS LIMITED, WHIC H WAS NOT APPEARING I.T.A. NO.: 1093/KOL./20 12 ASSESSMENT YEAR : 2008-200 9 2 IN THE RETURN OF INCOME FILED. ASSESSING OFFICER OB TAINED A CONFIRMATION FROM THE SAID COMPANY THAT IT HAD ENGAGED THE ASSES SEE FOR DOING CONTRACT WORK FOR WHICH PAYMENT OF RS.7,26,124/- WA S MADE BY THEM. THE GROSS AMOUNT AS PER THE SAID COMPANY WAS RS.8,15,87 4.61 AND AFTER DEDUCTION OF SERVICE TAX AND EDUCATIONAL CESS ON SE RVICE TAX, AN AMOUNT OF RS.7,26,124.68 WAS PAID TO THE ASSESSEE. THE AMOUNT WAS ALSO DEPOSITED IN ICICI BANK ACCOUNT NO. 018805001104 OF THE ASSES SEE. ASSESSING OFFICER WAS OF THE OPINION THAT ASSESSEE HAD ALREAD Y CHARGED IN HIS ACCOUNTS, EXPENDITURE INCURRED FOR THIS PARTICULAR CONTRACT WORK ALSO. HOWEVER, ASSESSEE HAD NOT DISCLOSED THE CONTRACT RE CEIPT FROM M/S. SHRI RAMRUPAI BALAJI STEELS LIMITED IN HIS ACCOUNTS. THE REFORE, AS PER THE ASSESSING OFFICER SUCH AMOUNT WAS UNDISCLOSED CONTR ACT RECEIPT, WHICH COULD BE TREATED AS ASSESSEES INCOME. AN ADDITION OF RS.7,26,124.68 WAS MADE. 3. IN HIS APPEAL BEFORE LD. CIT(APPEALS), ARGUMENT OF THE ASSESSEE WAS THAT HE HAD INCURRED CONSIDERABLE EXPENDITURE ON TH E CONTRACT WORK DONE FOR M/S. SHRI RAMRUPAI BALAJI STEELS LIMITED. AS PE R THE ASSESSEE, WHOLE OF THE CONTRACT RECEIPT COULD NOT BE CONSIDERED AS INCOME. EXPENDITURE INCURRED BY THE ASSESSEE OUGHT HAVE BEEN ALLOWED AN D ONLY THE REMAINING AMOUNT SHOULD HAVE BEEN CONSIDERED AS INCOME. 4. HOWEVER, LD. CIT(APPEALS) WAS NOT IMPRESSED BY T HE ABOVE ARGUMENT. ACCORDING TO HIM, ASSESSEE HAD NOWHERE ME NTIONED BEFORE THE ASSESSING OFFICER THAT EXPENDITURE INCURRED FOR THE CONTRACT WORK DONE FOR M/S. SHRI RAMRUPAI BALAJI STEELS LIMITED, WAS N OT ACCOUNTED BY IT. THEREFORE, ACCORDING TO THE LD. CIT(APPEALS), THERE WAS NO CASE FOR GIVING ANY FURTHER ALLOWANCE FOR EXPENDITURE. HE THUS CONF IRMED THE ADDITION MADE BY THE ASSESSING OFFICER. 5. NOW BEFORE US, LD. A.R. STRONGLY ASSAILING THE O RDERS OF THE AUTHORITIES BELOW SUBMITTED THAT GROSS CONTRACT REC EIPT DECLARED BY THE I.T.A. NO.: 1093/KOL./20 12 ASSESSMENT YEAR : 2008-200 9 3 ASSESSEE IN HIS RETURN OF INCOME WAS RS.80,06,713/- . ASSESSEE HAD RETURNED NET PROFIT OF RS.4,07,183/- THEREON. THOUG H AS PER LD. A.R. RECEIPT OF RS.7,26,124.68 WAS NOT A PART OF THE CON TRACT RECEIPTS DECLARED, IT REMAINED A FACT THAT CONSIDERABLE EXPENDITURE WA S INCURRED BY THE ASSESSEE FOR EXECUTION OF THE CONTRACT WORK. ACCORD ING TO HIM, CONSIDERING WHOLE OF THE CONTRACT AMOUNT AS INCOME WOULD RESULT IN NET PROFIT FROM THE CONTRACT WORK GOING UPTO 14%, WHICH WAS UNREASONABLE AND IMPRACTICABLE. THEREFORE, ACCORDING TO HIM ONLY A PORTION OF THE CONTRACT RECEIPT COULD BE CONSIDERED AS INCOME. 6. PER CONTRA, LD. D.R. SUBMITTED THAT WHATEVER EXP ENDITURE INCURRED BY THE ASSESSEE WOULD HAVE BEEN BOOKED BY IT IN ITS ACCOUNTS AND, THEREFORE, THERE WAS NO CASE FOR ALLOWING ANY FURTH ER EXPENDITURE ON THE UNDISCLOSED CONTRACT RECEIPTS. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THERE IS NO DISPUTE THAT A SUM OF RS.7,26,124.68 RECEIVED BY THE ASSESSEE FROM M/S. SHREE RAMRUPAI B ALAJI STEELS LIMITED WAS NOT DISCLOSED BY IT AS PART OF ITS CONTRACT REC EIPTS. TOTAL CONTRACT RECEIPT DECLARED BY THE ASSESSEE WAS RS.80,06,713/- WHICH DID NOT INCLUDE THE ABOVE AMOUNT OF RS.7,26,124.68. AT THE SAME TIME, CONFIRMATION RECEIVED BY THE ASSESSING OFFICER FROM THE RELEVANT PARTY FOR THE ABOVE AMOUNT CLEARLY SHOWS THAT BILLS WERE RAIS ED BY THE ASSESSEE ON THE SAID PARTY AGAINST VARIOUS WORKS DONE BY THE AS SESSEE FOR IT. THUS IT IS AN ADMITTED POSITION ASSESSEE HAD DONE WORK FOR M/S . SHREE RAMRUPAI BALAJI STEELS LIMITED. AS A NECESSARY COROLLARY, IT WOULD HAVE INCURRED EXPENDITURE FOR SUCH WORKS AS WELL. THERE IS NOTHIN G ON RECORD TO SHOW THAT EXPENDITURE INCURRED FOR THE WORKS RELATING TO M/S. SHREE RAMRUPAI BALAJI STEELS LIMITED WAS ALREADY BOOKED BY THE ASS ESSEE IN ITS BOOKS OF ACCOUNTS. ASSESSING OFFICER HAS NOT BEEN ABLE TO SH OW ANY EXPENDITURE INCURRED ON SUCH WORK WHICH WAS DEBITED OR CHARGED IN THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE. THIS BEING SO, WE ARE OF THE OPINION I.T.A. NO.: 1093/KOL./20 12 ASSESSMENT YEAR : 2008-200 9 4 THAT WHOLE OF THE UNDISCLOSED CONTRACT RECEIPTS COU LD NOT HAVE BEEN CONSIDERED AS INCOME. IF IT IS SO CONSIDERED, PROFI T WOULD BE UNREASONABLY HIGH COMING TO 14%. WE ARE, THEREFORE, OF THE OPINI ON THAT IT WOULD BE JUST AND REASONABLE TO CONSIDER 10% OF THE UNDISCLO SED CONTRACT RECEIPT OF RS.7,26,124.68 AS INCOME OF THE ASSESSEE AND NOT WHOLE OF THE AMOUNT. THEREFORE, THE ADDITION IS CONFIRMED TO THE EXTENT OF RS.72,612/- AND BALANCE OF THE ADDITION IS DELETED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED AS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH DAY OF MAY, 2014. SD/- SD/- GEORGE MATHAN ABRAHAM P. GEORGE (JUDICIAL MEMBER) (ACC OUNTANT MEMBER) KOLKATA, THE 27 TH DAY OF MAY, 2014 COPIES TO : (1) RAJIB RANJAN KUMAR SINHA, OLD COURT MORE, DURGAPUR-713 203 (2) INCOME TAX OFFICER, WARD-1(2), DURGAPUR (3) CIT(APPEALS) (4) CIT (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.
