S.Sankar, Kumbakonam V. ITO, Kumbakonam

ITA 117/CHNY/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8215 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2016
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 17-12-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 14-01-2015
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: G SEETHARAMAN
• Keywords: Income from undisclosed sources

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : CHENNAI , ! ' ! # . $ , & '( ) [ BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ] ./ I.T.A.NO.117/MDS/2015 / ASSESSMENT YEAR : 2010-11 SHRI S SANKAR 13-A, EAST STREET PATHARAKUDI, KOVILACHERY POST SHOLAPURAM KUMBAKONAM 612 503 VS. THE INCOME TAX OFFICER WARD I(3) KUMBAKONAM [PAN AYUPS 8988 D ] ( *+ / APPELLANT) ( ,-*+ /RESPONDENT) / APPELLANT BY : SHRI G SEETHARAMAN, ADVOCATE /RESPONDENT BY : SHRI P RADHAKRISHNAN, JC IT / DATE OF HEARING : 17 - 12 - 2015 / DATE OF PRONOUNCEMENT : 20 - 01 - 2016 . / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS), TIRUC HIRAPALLI, DATED 9.10.2014, FOR ASSESSMENT YEAR 2010-11. ITA NO. 117/15 :- 2 -: 2. THE ASSESSEE IS CONTESTING THE ADDITION OF ` 22,34,917/- ON ACCOUNT OF SUPPRESSION OF CONTRACT RECEIPTS AND ` 10,39,664/- TOWARDS UNDERSTATEMENT OF WORK-IN-PROGRESS. 3. THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS A C IVIL CONTRACTOR AND SHOWN INCOME OF ` 3,74,870/-. THE ASSESSING OFFICER WAS OF THE OPINION THAT THE ASSESSEE UNDERSTATED W ORK-IN-PROGRESS TO THE TUNE OF ` 10,39,664/- AND CONTRACT RECEIPTS OF ` 22,34,917/- AND HE MADE ADDITION TOWARDS THESE COUNTS. ON APPEAL, T HE ASSESSEE STATED THAT THERE WAS ACTUALLY NO UNDERSTATEMENT OF CONTRACT RECEIPTS OR WORK-IN-PROGRESS AND THE ENTIRE WORK-IN-PROGRESS WAS COMPUTED FROM THE PURCHASES AND ALSO CONTRACT RECEIPTS ARE F ULLY DISCLOSED IN THE BOOKS OF ACCOUNT AND BOOKS OF ACCOUNT WAS SUBJECT T O AUDIT. HOWEVER, THE CIT(A), DID NOT MERIT IN THE ARGUMENTS OF THE LD. COUNSEL AND CONFIRMED THE ABOVE ADDITIONS AGAINST WHICH THE ASSESSEE IS IN APPEAL BEFORE US. 4. THE LD. AR REITERATED THE SUBMISSIONS MADE BEFORE T HE LOWER AUTHORITIES AND ALSO FILED COPY OF AUDITED PROFIT & LOSS ACCOUNT AND BALANCE SHEET AND SUBMITTED THAT ENTIRE RECEIPTS AN D WORK-IN-PROGRESS ARE ALREADY ACCOUNTED AND THERE IS NO QUESTION OF M AKING ANY ADDITION. IF AT ALL ANY ADDITION IS TO BE MADE, IT SHOULD BE TOWARDS DISCREPANCIES IN THE NET PROFIT RATE CONSIDERED FOR QUANTIFICATION OF UNACCOUNTED INCOME. ITA NO. 117/15 :- 3 -: 5. ON THE OTHER HAND, THE LD. DR RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATE RIAL ON RECORD. IN OUR OPINION, THE ASSESSING OFFICER HAS NOT EXAMINED THE BOOKS OF ACCOUNT PROPERLY AND HE HAS TO SEE WHETHER THE WORK-IN- PROGRESS WAS ACTUALLY COMPUTED FROM THE TOTAL PURCH ASES AND NET MATERIAL CONSUMED CLAIMED AS EXPENDITURE IN INCOME AND EXPENDITURE ACCOUNT AND ALSO TO SEE WHETHER THE CONTRACT RECEIP TS OF ` 21,09,559/- RECEIVED FROM THE DISTRICT RURAL DEVELOPMENT AUTHOR ITY WAS INCLUDED IN THE TOTAL CONTRACT SHOWN IN THE INCOME AND EXPENDIT URE ACCOUNT. ACCORDINGLY, IN THE INTEREST OF JUSTICE, WE REMIT T HE ENTIRE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDERATI ON. NEEDLESS TO SAY THAT IF THE ASSESSING OFFICER FINDS THAT THERE IS UNDERSTATEMENT OF WORK-IN-PROGRESS AND UNACCOUNTING OF CONTRACT RECEI PTS, THEN THE ASSESSING OFFICER SHOULD CONSIDER THE ENTIRE AMOUNT OF UNDERSTATEMENT OF WORK-IN-PROGRESS AND UNACCOUNTED CONTRACT RECEIP TS AS A WHOLE AS INCOME OF THE ASSESSEE AND THERE IS NO QUESTION OF ESTIMATING PERCENTAGE OF INCOME ON THESE ELEMENTS. ORDERED ACC ORDINGLY. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. ITA NO. 117/15 :- 4 -: ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH JANUARY, 2016, AT CHENNAI. SD/- SD/- ( ! ' ! # . $ ) ( DUVVURU RL REDDY ) & / JUDICIAL MEMBER ( ) ( CHANDRA POOJARI ) / ACCOUNTANT MEMBER !' / CHENNAI #$ / DATED: 20 TH JANUARY, 2016 RD $%&& '(&)( / COPY TO: & 1 . / APPELLANT 4. & * / CIT 2. / RESPONDENT 5. (+,& - / DR 3. & *&./ / CIT(A) 6. ,0&1 / GF