Dy. Commissioner of Income Tax, Circle-2(2), Hyderabad V. Techtrans Construction India Private Limited, Hyderabad

ITA 1376/Hyd/2017

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0503 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 11 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2021
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 04-05-2021
• Assessment Year: 2012-2013
• Appeal Filed On: 04-08-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Presumptive income
• Section: 44AD; 143(3); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B , HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER ITA NO .1376 /HYD/ 2017 ASSESSMENT YEAR: 20 12 - 13 DCIT, CIRCLE - 2(2), HYDERABAD. VS. TECHTRANS CONSTRUCTION INDIA PRIVATE LIMITED, HYDERABAD. PAN: AACCT 5786 D (APPELLANT) (RESPONDENT) ASSESSEE BY: NONE REVENUE BY: SHRI ROHIT MUJUMDAR, DR DATE OF HEARING: 0 4/5/2021 DATE OF PRONOUNCEMENT: 15 / 7/2021 ORDER PER A. MOHAN ALANKAMONY, AM.: THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT (A) - 2, HYDERABAD IN APPEAL NO. 0182/2015 - 16, DATED 02/05/2017 PASSED U/S. 143(3) R.W.S 250(6) OF THE ACT FOR THE AY: 2012 - 13. 2. THE REVENUE HAS RAISED TWO GROUNDS IN ITS APPEAL HOWEVER THE CRUX OF THE ISSUE IS THAT : THE LD. CIT (A) HAS ERRED IN DIRECTING T HE LD. AO TO ESTIMATE THE INCOME OF THE ASSESSEE AT 2.5% OF ITS GROSS RECEIPTS AS AGAINST THE INCOME ESTIMATED BY THE LD. AO AT 5% ON GROSS 2 RECEIPTS WITH RESPECT TO THE ASSESSEES BUSINESS OF EXECUTING ROAD LAYING SUB - CONTRACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGED IN THE BUSINESS OF UNDERTAKING ROAD LAYING SUB - CONTRACT MAINLY FROM RELIANCE UTILITY AND ENGINEERS PRIVATE LIMITED. THE ASSESSEE IS ONE OF THE CONSTITUENT PARTNERS OF M/ S. TECHTRANS CONSTRUCTION (I) PRIVATE LIMITED. DURING THE RELEVANT ASSESSMENT YEAR, THE ASSESSEE WAS ENGAGED IN THE PROJECT OF CONSTRUCTING CARRIAGE WAY IN SECTION NH - 67 IN TAMIL NADU. THE CASE OF THE ASSESSEE WAS TAKEN UP FOR SCRUTINY. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSEE COULD PRODUCE ONLY FEW COPIES OF CERTAIN LEDGER ACCOUNTS BUT COULD NOT PRODUCE BILLS, VOUCHERS ETC., TO JUSTIFY THE EXPENDITURE INCURRED BY IT. THEREFORE, THE LD. AO ESTIMATED THE PROFIT OF THE ASSESSEE AT 5% OF ITS TURNOVER OF RS. 65,08,71,061/ - WHICH WORKS OUT TO RS. 3,25,43,560/ - . ON APPEAL, THE LD. CIT (A) DIRECTED THE LD. AO TO ESTIMATE THE INCOME OF THE ASSESSEE AT 2.5% OF ITS GROSS RECEIPTS. 4. BEFORE US, AT THE TIME OF HEARING NONE APPEARED ON BEHA LF OF THE ASSESSEE TO REPRESENT ITS CASE. 5. AT OUTSET, WE DO NOT FIND THE CONDUCT AND COMPLIANCE OF THE ASSESSEE APPROPRIATE, ESPECIALLY WHEN IT HAS GENERATED HUGE TURNOVER OF RS. 65,08,71,061/ - . EVEN IN THE CASE OF ASSESSEE S WHO ARE HAVING LOWER 3 TURNOVER AND FOR WHOM THE PROVISIONS OF SECTION 44AD IS APPLICABLE THEY ARE BOUND TO MAINTAIN PROPER BOOKS OF ACCOUNTS AND GET THEIR ACCOUNTS AUDITED WHEN THEY DECLARE LE SSER PROFIT THAN THE STIPULATED PROFIT ALLOWED FOR COMPUTING THE TAX ON PRESUMPTIVE BASIS AS PER THE PROVISIONS OF THE ACT . IN THESE CIRCUMSTANCES, THE GROSS LAPSE ON THE PART OF THE ASSESSEE FOR NOT MAINTAINING ITS BOOKS OF ACCOUNTS AND BILLS AND VOUCHERS IS NOT APPRECIABLE. HOWEVER, CONSIDERING THE NATURE OF WORK UNDERTAKEN BY THE ASSESSEE AND THE HARDSHIP FACED BY THE ASSESSEE WITH RESPECT TO THE SUB - CONTACT WORK OF LAYING CARRIAGE WAY, IN THE INTEREST OF JUSTICE, WE HEREBY REMIT THE ENTIRE MATTER BACK TO THE FILE OF THE LD. AO FOR FRESH CONSIDERATION. 6. . IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES AS INDICATED HEREIN ABOVE. PRONOUNCED IN THE OPEN COURT ON 15 TH JULY, 2021 . SD/ - SD/ - ( S.S. GODARA ) ( A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED: 15 TH JULY , 2021 OKK COPY TO: - 1) M/S. TECHTRANS CONSTRUCTION INDIA PRIVATE LIMITED, 7 - 1 - 58, 1 - 103, 1 ST FLOOR , DIVYASAKTI COMPLEX, AMEERPET, HYDERABAD. 2) DCIT, CIRCLE - 2(2), R.NO. 513, 5 TH FLOOR, SIGNATURE TOWERS, KONDAPUR, HYDERABAD. 3) CIT (A) - 2, HYDERABAD. 4) THE PRINCIPAL COMMISSIONER OF INCOME TAX - 2, HYDERABAD. 4 5) THE DR, ITAT, HYDERABAD 6) GUARD FILE