Asst.CIT,Circle 8(1), Hyderabad V. M/s. Sai Krishna Construction, Hyderabad

ITA 1257/HYD/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87478 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2015
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 26-03-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 26-06-2014
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITRA
• Assessee Lawyers: V RAGHAVENDRA RAO

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER I.T.A. NO. 1257/HYD/2014 ASSESSMENT YEAR: 2009-10 THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-8(1), HYDERABAD VS M/S. SAI KRISHNA CONSTRUCTION, SBH COLONY, SRINAGAR COLONY, HYDERABAD [PAN: AAOFS0684A] (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI RAJAT MITRA, DR FOR ASSESSEE : S HRI V. RAGHAVENDRA RAO , AR DATE OF HEARING : 26 - 0 3 - 201 5 DATE OF PRONOUNCEMENT : 31 - 03 - 2015 O R D E R PER B. RAMAKOTAIAH, A.M. : THIS IS REVENUE'S APPEAL FILED AGAINST THE ORDER O F THE COMMISSIONER OF INCOME TAX(APPEALS)-VIJAYAWADA, DAT ED 20-03-2014. 2. BRIEFLY STATED, ASSESSEE-FIRM IS ENGAGED IN THE BUSINESS OF CONSTRUCTION AND SALE OF FLATS. SURVEY OPERATIONS U/S.133A OF THE INCOME TAX ACT (ACT) WERE CONDUCTED ON 11-08-2009. ASSESSEE FILED RETURN OF INCOME ON 25-09-2009 DECLARING INCOME OF RS.81,49,392/-, ADMITTING 10% INCOME, AS DISCLOSED DURING THE COURS E OF SURVEY, ON I.T.A. NO. 1257/HYD/14 M/S. SAI KRISHNA CONSTRUCTION :- 2 -: GROSS RECEIPTS OF RS.8,14,93,918/-. IN THE COURSE O F ASSESSMENT PROCEEDINGS, ASSESSING OFFICER (AO) NOTICED THAT SA LE PROCEEDS IN RESPECT OF SALE OF ONE FLAT AMOUNTING TO RS.44,20,000/- IN THE NAME OF SMT.RENU SHOREY WHICH WAS APPEARING IN THE BOOKS OF ACCOUNTS WAS NOT TAKEN INTO ACCOUNT IN THE GROSS-RECEIPTS WORKED OUT DURIN G THE SURVEY. WHEN THIS WAS POINTED OUT, ASSESSEE HAS STATED THAT THIS AMOUNT WAS INCLUDED IN THE RECEIPTS SHOWN AT RS.8,14,93,918/-, BUT AO D ID NOT ACCEPT ASSESSEE'S EXPLANATION. INSTEAD OF ASSESSING THE P ROFIT AT 10% ON THE SAID AMOUNT, AO ADDED THE ENTIRE AMOUNT OF SALE CON SIDERATION OF RS.44,20,000/- AS INCOME. AO ALSO MADE ADDITION OF RS.3,41,120/- AS MISCELLANEOUS RECEIPTS NOT DISCLOSED, ON WHICH EVEN THOUGH ASSESSEE PREFERRED AN APPEAL BEFORE LD.CIT(A), DID NOT PRESS THE ISSUE. 3. LD.CIT(A) CONSIDERING ASSESSEE'S EXPLANATION ACCEPTED THAT THESE AMOUNTS WERE IN FACT PART OF THE TWO ADVANCES OF RS.43,50,000/- SHOWN IN THE BOOKS OF ACCOUNTS UNDER THE HEAD 'ADVA NCES RECEIVED FROM CUSTOMERS' WHICH WERE INCLUDED IN THE SALE, THEREFO RE, THERE IS NO SUPPRESSION OF TURNOVER. LD.CIT(A) ON EXAMINATION OF THE FACTS, CONFIRMED AN ADDITION OF RS.70,000/- AND DELETED TH E AMOUNT OF RS.43,50,000/- WITH THE FOLLOWING ORDER: 'DURING THE COURSE OF APPEAL PROCEEDINGS, THE APPE LLANT'S A.R HAS SUBMITTED THAT THE SALE PROCEEDS OF RS.44,22,000/- WERE NOT TAKEN INTO ACCOUNT WHILE WORKING OUT THE GROSS RECEIPT D URING THE COURSE OF SURVEY, HOWEVER, THERE IS ONLY MINOR VARIATION OF RS.70,000/- IN THE INCOME ADMITTED DUE TO THE FACT THAT TWO ADVANCES OF RS.19,50,000/- AND RS.24,00,000/-, TOTALING IN ALL TO RS.43,50,000/-,SHOWN IN THE BOOKS OF ACCOUNT UNDER THE HEAD 'ADVANCES RECEIVED FROM THE CUSTOMERS' WERE INCLUD ED AS SALES IN THE GROSS RECEIPTS WORKED OUT AT THE TIME OF SURVE Y. HE FILED A RECONCILIATION STATEMENT TO THIS EFFECT ALONG WITH COPIES OF SALE DEEDS, DETAILS OF SALES RECEIPTS, ADVANCES AS PER BALANCE SHEET ETC. ON A PERUSAL OF THE ASSESSMENT ORDER, IT IS NOTICE D THAT THE APPELLANT HAD MADE THE SAME SUBMISSIONS BEFORE THE AO, HOWEVER, THE AO DID NOT DISCUSS ANYTHING ABOUT THE ADVANCES SHOWN AS SALE I.T.A. NO. 1257/HYD/14 M/S. SAI KRISHNA CONSTRUCTION :- 3 -: PROCEEDS, BUT ONLY ADDED THE SALE PROCEEDS OF RS.4 4,20,000/- AS SUPPRESSED SALES, WHICH IS NOT IN ORDER. WHEN THE SUPPRESSED SALES WERE CONSIDERED AS INCOME, THE AO OUGHT TO HAVE CO NSIDERED THE ADVANCES SHOWN AS GROSS RECEIPTS AND REDUCE THE SA ME FROM GROSS RECEIPTS AND MADE ADDITION TO THE EXTENT OF ANY VA RIATION. IF HE OPPOSES THE APPELLANT'S EXPLANATION ON ADVANCES, H E SHOULD HAVE BROUGHT ON RECORD SOME EVIDENCE TO THIS EFFECT. MO REOVER, THE AO DID NOT FIND ANY FAULT WITH THE BOOKS OF ACCOUNT WHICH INCLUDES P&L ACCOUNT, BALANCE SHEET ETC., PRODUCED BY THE APPEL LANT AND ACCEPTED THE SAME. THE APPELLANT HAS RECONCILED TH E DIFFERENCE AND SUBMITTED NECESSARY EVIDENCE IN THE FORM OF SALE D EEDS, DETAILS OF GROSS RECEIPTS, ADVANCES ETC., IN SUPPORT OF HIS C LAIM. IN THE CIRCUMSTANCES, THE AO IS DIRECTED TO CONSIDER THE ADVANCES SHOWN AS GROSS RECEIPTS AND RESTRICT THE ADDITION TO RS. 70,000/- I.E, TO THE EXTENT OF VARIATION BETWEEN THE SUPPRESSED SALE VA LUE AND THE AMOUNT OF ADVANCES SHOWN AS RECEIPTS (RS.44,20,000 - RS.43,50,000)'. 4. ON CONSIDERING THE RIVAL CONTENTIONS AND PERUSIN G THE RECONCILIATION PLACED ON RECORD, WE ARE OF THE OPIN ION THAT THERE IS NO NEED TO DISTURB THE ORDER OF CIT(A). IN FACT, EVEN THOUGH ASSESSEE HAS GIVEN SAME EXPLANATION IN THE COURSE OF ASSESSMENT PROCEEDINGS, AO DID NOT ACCEPT THE SAME AND BROUGHT THE ENTIRE AMOUNT T O TAX. LD. CIT(A) ORDER IS CORRECT ON THE FACTS OF THE CASE AND REVEN UE HAS NOT BROUGHT ANYTHING ON RECORD TO COUNTER SUCH FINDING. 5. IN VIEW OF THIS, WE UPHOLD THE ORDER OF CIT(A) A ND DISMISS THE REVENUE'S APPEAL. ORDER PRONOUNCED IN OPEN COURT ON 31 ST MARCH, 2015. SD/- SD/- (SAKTIJIT DEY) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUN TANT MEMBER HYDERABAD, DATED 31 ST MARCH, 2015 TNMM I.T.A. NO. 1257/HYD/14 M/S. SAI KRISHNA CONSTRUCTION :- 4 -: COPY TO : 1. THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE - 8 (1), 8 TH FLOOR, C-BLOCK, I.T.TOWERS, HYDERABAD. 2. M/S. SAI KRISHNA CONSTRUCTION, 8-3-961/A, BESIDE SBI, SRIPADA TOWERS, SBH COLONY, SRINAGAR COLONY, HYDERA BAD. 3. CIT(APPEALS)-VIJAYAWADA 4. CIT-II, HYDERABAD 5. D.R. ITAT, HYDERABAD