Shri Sanjivkumar C.Kiklawala, Surat V. The Income tax Officer,Ward-3(4), Surat

ITA 1233/AHD/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 0231 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 26-07-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 02-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: M K PATEL
• Keywords: Bogus purchase
• Section: 144

Judgement Text

I.T.A. NO . 1233 /AHD/201 3 A SSESSMENT Y EAR: 200 8 - 09 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH, SMC , AHMEDABAD [CORAM: PRAMOD KUMAR AM] I.T.A. NO. 1233 /A HD/ 20 1 3 ASSESSMENT Y EAR : 200 8 - 09 SANJIVKUMAR C. KIKLAWALA, .... . ...... . ... . APPELLANT 171, DIWALIBAUG SOCIETY, ADAJAN PATIA, RANDER RO AD, SURT 395 003 . [ PAN: A BNPK 6540 M ] VS. INCOME TAX OFFICER, WARD 3 ( 4 ), SURAT. ... ............ . RESPONDENT APPEARANCES BY: M.K. PATEL , FOR THE APPELLANT SATISH SOLANKI , FOR THE RESPONDENT D ATE OF CONCLUDI NG THE HEARING : 26 .0 7 .2016 DATE OF PRONOUNCING THE ORDER : 25 .10.2016 O R D E R 1. BY WAY OF THIS APPAL, THE ASSESSEE APPELLANT HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 19 TH FEBRUARY, 2013, PASSED BY THE LEARNED CIT(A), IN THE M ATT E R OF ASSESSMENT UNDER SECTION 144 OF THE INCOME TAX AT, 1961, FOR THE ASSESSMENT YEAR 200 8 - 09 . 2. IN THE FIRST GROUND OF APPEAL, THE ASSESSEE HAS R AISED THE FOLLOWING GRIEVANCE: - ON THE FACTS A ND IN THE CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON T HE SUBJECT, THE LEARN E D COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN MAKING ADDITION EXTENT TO RS.9,30,144/ - ON ACCOUNT OF ALLEGED DISALLOWANCE OF ENTIR E EXPENSES INCLUDING PURCHASES. I.T.A. NO . 1233 /AHD/201 3 A SSESSMENT Y EAR: 200 8 - 09 PAGE 2 OF 3 3. BRIEFLY STA T ED, THE RELEVANT MATERIAL FACTS ARE LIKE THIS. IT IS A CASE IN WHICH THE BOOKS OF ACCOUNT ARE ADMITTEDLY NOT AVAILABLE AS THESE WERE STOLEN AND THE MATTE R WAS DULY REPORTED TO POLICE ON 10.12.2010. THE ENTIRE SALES DISCLOSED BY THE ASSESSEE IS RS.38,21,0 95/ - . WHILE THE SALE WAS DULY ACCEPTED, THE PURCHASES AND EXPENSES OF RS.46,50,721/ - , WERE DISALLOWED IN ASSESSMENT PROCEEDINGS. IN APPEAL BEFORE THE LEARNED CIT ( A ) , DISALLOWANCE W A S RESTRICTED TO 20% OF SALES AND EXPENSES. THE ASSESSEE IS NOT SATISFIED AND IS IN FURTHER APPEAL BEFORE ME. 4. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF APPLICABLE LEGAL POSITION. 5. I FIND THAT SO FAR DECISION OF TRIBUNAL, IN THE CASE OF VIJA Y PROTEINS LIMITED VS. ACIT [(1996) 58 ITD 428 (AHD)] RELYING ON WHICH LEA R NED CIT(A) HAS RESTRICTED DISALLOWANCE TO 20% OF TOTAL PURCHASES AND EXPENSES, IS CONCERNED, IT D EALT WITH A CASE OF BOGUS PURCHASES. IT WAS NOT A CASE IN WHICH ASSESSMENT WAS BEI NG COMPLETED WITHOUT THE BENEFIT OF EXAMINING THE BOOKS OF ACCOUNT. IN A SITUATION IN WHICH BOOKS OF ACCOUNT ARE NOT AVAILABLE, AS IN THE PRESENT CASE, AND PROFIT IS TO BE ESTIMATED, IT CAN BE DONE ON A REASONABLE BASIS RATHER THAN BY REJECTING THE CLAI M FOR EXPENSES. IN THIS VIEW OF THE MAT T ER, AND KEEPING IN MIND ENTIRETY OF THE CASE, I DEEM IT FIT AND PROPER TO DIRECT THE ASSESSING OFFICER TO ADOPT NET PROFIT @ 10% OF SALES WHICH IS NOT DISPUTED BY ANY OF THE AUTHORITIES BELOW. THE ASSESSING OFFICER WILL RECOMPUTE THE TAXABLE BUSINESS ACCORDINGLY. 6. GROUND NO.1 IS THUS PARTLY ALLOWED IN THE TERMS INDICATED ABOVE. 7. GROUND NO.2 IS NOT PRESSED AND IS, ACCORDINGLY, DISMISSED FOR WANT OF PROSECUTION. I.T.A. NO . 1233 /AHD/201 3 A SSESSMENT Y EAR: 200 8 - 09 PAGE 3 OF 3 8. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED IN THE TERMS INDICATED ABOVE. P RONOUNCED IN THE OPEN COURT TODAY ON 25 TH DAY OF OCTOBER , 2016. SD/ - PRAMOD KUMAR (ACCOUNTANT MEMBER) DATED: THE 25 . TH DAY OF OCTOBER , 2016. PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD