Upkar Infra Projects Pvt.Ltd., Hyd, Hyderabad V. DCIT, Circle-3(3), Hyd, Hyderabad

ITA 1347/HYD/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2503 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 07-12-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: N SWAPNA
• Assessee Lawyers: P RAVI SESHAGIRI RAO
• Keywords: Depreciation
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B SMC BENCH: HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT ITA. NO. 1347 & 1348 /HYD/ 2015 ASSESSMENT YEAR S : 2003 - 04 & 2004 - 05 M/S. UPKAR INFRA PROJECTS PVT LTD., 6 - 3 - 347/22/102, 101, SAI LILLE APARTMENTS, DWARAKAPURI COLONY, PANJAGUTTA, HYDERABAD. PAN: AABCK 4691 F VS. DY. COMMISSIONER OF INCOME TAX, CIRCLE - 3(3), HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE: SHRI P. RAVI SESHAGIRI RAO FOR REVENUE : SMT. N. SWAPNA, DR DATE OF HEARING : 05 .0 2 .2018 DATE OF PRONOUNCEMENT : 05 .0 2 .2018 ORDER PER D. MANMOHAN , VP. THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE COMBINED ORDER PASSED BY LD. CIT(A) - 5, HYDERABAD AND THEY ARE WITH RESPECT TO THE AYS 2003 - 04 AND 2004 - 05. 2. AT THE OUTSET, IT MAY BE NOTICED THAT THE MATTERS PENDING BEFORE THE TRIBUNAL ARIS E OUT OF THE DIRECTION GIVEN BY THE TRIBUNAL IN THE FIRST ROUND OF LITIGATION WHEREBY CONSEQUENTIAL ORDER S WERE PASSED BY THE ASSESSING OFFICER. THE SE APPEALS WERE FILED IN 2015 AND THE CASE WAS ADJOURNED O N NUMBER OF OCCASIONS BUT , ON SOME GROUND OR THE OTHER, THE CASE WAS GETTING ADJOURNED AT THE REQUEST OF THE ASSESSEE. NOW THE LD COUNSEL FOR THE ASSESSEE SEEKS ADJOURNMENT ON THE GROUND THAT A 2 PAPER BOOK IS BEING FILED TODAY; HOWEVER, NO SUCH PAPER BOOK HAS BEEN FILED. IT WAS FURTHER SUBMITTED THAT IN RESPECT OF THE A.Y. 2006 - 07 A MISCELLANEOUS APPLICATION IS FILED BY THE ASSESSEE WHICH IS POSTED FOR HEARING ON 09.02.2018 AND THEREFORE, HE REQ UESTED FOR POST ING ALL THE APPEALS TOGETHER. 3. AT THE OUTSET, IT DESERVES TO BE NOTICED THAT THE CASE WAS ADJOURNED ON NUMBER OF OCCASIONS AND THE ASSESSE E DID NOT FILE THE PAPER BOOK TILL TODAY AND HENCE, THERE IS NO NEED TO WAIT FURTHER. EVEN IF THE M ISCELLANEOUS APPLICATIONS ARE POSTED FOR HEARING , AN APPROPRIATE DECISION CAN ALWAYS BE TAKEN IN THAT CASE INDEPENDENTLY AND THERE IS NO NEED TO WAIT ETERNALLY FOR THE DISPOSAL OF THAT APPEAL. I THEREFORE REJECT THE REQUEST AND PROCEED TO DISPOSE OF THESE APPEALS. 4. LD COUNSEL APPEARING FOR THE ASSESSEE DID NOT MAKE ANY ELABORATE SUBMISSIONS EXCEPT RELYING ON THE ARGUMENTS ADVANCE D IN THE FORM OF GROUNDS OF APPEAL. 5. ON THE OTHER HAND, LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF CIVIL CONTRACTS AND DECLARED A TOTAL INCOME OF RS. 12,66,390/ - WHICH WAS ORIGINALLY PROCESSED U/S 143(3) OF THE ACT BUT , LATER ON THE CASE WAS TAKEN UP FOR SCRUTINY WHEREIN THE ASSESSMENT WAS COMPLETED BY ESTIMATING THE PROFIT @ 12.5% ON GROSS RECEIPTS OFFERED BY THE ASSESSEE AND DEPRECIATION WAS ALSO ALLOWED AS PER THE INCOME TAX ACT, 1961. 6. ON AN APPEAL FILED BY THE ASSESSEE, LD. CIT (A) DIRECTED THE A.O. TO ESTIMATE THE PROFIT @ 10% ON GROSS RECEIPTS NET OF DEPRECIATION AS ALREADY ALLOWED BY THE ASSESSING OFFICER. ON FURTHER APPEAL, ITAT SET ASIDE THE ISSUE VIDE ORDER DATED 21.01.2013 DIRECTING THE AO TO 3 COMPLETE THE ASSESSMENT DE NOVO KEEPING IN MIND THE DECISION OF HONBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF INDWELL CONSTRUCTIONS VS. CIT AND THE DECISIONS OF THE ITAT ON THE SAME LINE OF REASONING. ACCORDINGLY, THE AO PROCEEDED TO COMPLETE THE ASSESSMENT U/S 143(3) R.W.S. 254 OF THE ACT WHEREIN HE OBSERVED , KEEPING IN MIND THE DECISIONS CITED (S UPRA) , ESTIMATION OF PROFIT @ 5% ON GROSS SUB - CONTRACT RECEIPTS, WHICH WORKS OUT TO RS. 31,99,282/ - , IS REASONABLE AND ACCORDINGLY COMPLETED THE ASSESSMENT. FOR THE AY 2004 - 05 ALSO THE ASSESSING OFFICER ESTIMATED THE PROFIT @ 5% ON SUB - CONTRACT RECEIPTS A ND COMPLETED THE ASSESSMENT. 7. AGGRIEVED, ASSESSEE CONTENDED BEFORE THE LD. CIT(A) THAT THE AO ERRED IN NOT ALLOWING DEPRECIATION. IT WAS ALSO CONTENDED THAT THE AO ERRED IN ESTIMATING THE INCOME @ 5% OF THE GROSS CONTACT RECEIPTS BY REDUCING ONLY SEIGN ORAGE CHARGES WHEREAS HE OUGHT TO HAVE REDUCED OTHER RECOVERIES. BEFORE THE LD. CIT(A) IT WAS ALSO CONTENDED THAT THE PRINCIPAL CONTRACTOR , FOR WHOM THE APPELLANT CARRIES OUT SUB - CONTRACT WORK , DECLARED NET PROFIT OF 7.24% ONLY FOR THE AY 2003 - 04 AND IF T HE RATE OF 8% IS TO BE APPLIED TO THE PRINCIPAL CONTRACTOR SUITABLE ADJUSTMENT TO BE MADE TO THE PROFIT ESTIMATED BY THE ASSESSING OFFICER. 8. LD CIT (A) REJECTED THE CONTENTIONS OF THE ASSESSEE BY GIVING DETAILED ANALYSIS OF FACTS, BEGINNING FROM PARA 6 ONWARDS. LD DR THEREFORE STRONGLY RELIED ON THE ORDER PASSED BY THE LD CIT (A). 9 . I HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. THERE IS NO MATERIAL ON RECORD TO JUSTIFY THE SUBMISSIONS MADE BY WAY OF GROUNDS OF APPEAL BEFORE THE TRIBUNAL AND NO MATERIAL WAS PLACED TO CONTRADICT THE FINDINGS OF THE LD CIT (A) AND THE ASSESSMENT YEARS INVOLVED HERE ARE 2003 - 04 AND 2004 - 05. IF THE ASSESSEE IS UNABLE 4 TO FURNISH ANY MATERIAL EVEN AFTER 13 / 14 YEARS, IT IS NOT ADVISABLE TO GIVE FURTHER TIME AT THIS JUNCTURE PERMITTING ASSESSEE TO FILE EVIDENCE, IF ANY, AT THIS STAGE. UNDER THESE CIRCUMSTANCES, I DO NOT FIND ANY INFIRMITY IN THE ORDERS PASSED BY THE LD C IT (A) AND ACCORDINGLY DISMISS THE APPEALS FILED BY THE ASSESSEE. ORDER PRONOUNCED IN THE OPEN COURT ON 05 TH FEBRUARY, 2018. S D / - (D. MANMOHAN) VICE PRESIDENT HYDERABAD, DATED: 05 TH FEBRUARY, 2018. OKK, SR.PS COPY TO 1. SHRI S. RAMA RAO, ADVOCATE, FLAT NO.102, SHGRIYAS ELEGANCE, 3 - 6 - 643, STREET NO.9, HIMAYAT NAGAR, HYDERABAD - 500 029. 2. DCIT, CIRCLE - 3(3), INCOME TAX TOWERS, A.C. GUARDS, HYDERABAD. 3. CIT (A) - 5 , HYDERABAD. 4. PR. COMMISSIONER OF INCOME TAX - 5 , HYDERABAD. 5. DR, ITAT, HYDERABAD. 6. GUARD FILE