Amdooru Raju Goud, Hyd, Hyderabad V. ITO, Ward-8(3), Hyd, Hyderabad

ITA 1421/HYD/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6447 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-06-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 18-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M SITARAM
• Assessee Lawyers: P RAVI SESHAGIRI RAO

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A (SMC) : HYDERABAD BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER ITA.NO.1421/HYD/2015 ASSESSMENT YEAR 2010-2011 MR. AMDOORU RAJU GOUD, HYDERABAD. PAN ADXPA8150P VS. THE INCOME TAX OFFICER, WARD-8(3) HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE : MR. P. RAVISESHAGIRI RAO FOR REVENUE : MR. M. SITARAM DATE OF HEARING : 14.06.2016 DATE OF PRONOUNCEMENT : 17 .06.2016 ORDER THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-II, HYDERABAD D ATED 18.09.2015 AND IT PERTAINS TO THE A.Y. 2010-2011. 2. BRIEFLY STATED, THE ASSESSEE IS AN INDIVIDUAL A ND IS IN THE BUSINESS OF SUPPLY OF MAN-POWER TO DIFFER ENT COMPANIES. THE NATURE OF THE ASSESSEES FUNCTION IS BROUGHT OUT UNDER SECTION 44AB IN FORM 3CD. THE A.O . REJECTED THE BOOKS OF ACCOUNT ON THE GROUND THAT NO PROPER SUPPORTING BILLS AND VOUCHERS WERE FURNISHED. HE ESTIMATED THE PROFIT AT 5%. ON APPEAL, THE FIRST AP PELLATE AUTHORITY CONFIRMED THE ORDER OF THE A.O. FURTHER AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US ON T HE FOLLOWING EFFECTIVE GROUNDS : 2 ITA.NO.1421/HYD/2015 MR. AMDOORU RAJU GOUD, HYDERABAD. 2. THE LD. CIT(A) ERRED CONFIRMING THE ACTION OF T HE A.O. IN ESTIMATING THE INCOME AT 5% OF THE GROSS RECEIPTS BY REJECTING THE BOOK RESULTS SOLELY ON THE GROUND THAT SOME OF THE VOUCHERS ARE SELF MADE. 3. THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF THE A.O. IN ARRIVING AT THE TURNOVER WITHOUT EXCLUDING THE COMPONENT OF SERVICE TAX, EMPLOYERS SHARE OF ESI, P.F. ETC. PAID BY THE CLIENT COMPANIES TOWARDS STATUTORY PAYMENTS. 3. AFTER HEARING THE RIVAL CONTENTIONS, WE AGREE WITH THE CONTENTION OF THE ASSESSEE THAT THE ESTIMA TION OF INCOME AT 5% ON GROSS RECEIPTS IS HIGH UNDER THE FA CTS AND CIRCUMSTANCES OF THE CASE. THE ASSESSEE FILED AN OR DER OF THE COORDINATE BENCH OF THE TRIBUNAL IN ITA.NO.1031/HYD/2002 DATED 20.11.2016 FOR THE A.Y. 1994-95 IN THE CASE OF M/S. RENU SINGH & CO., KARIM NAGAR VS. ITO, WARD-1, KARIMNAGAR WHEREIN, UNDER SIMILAR CIRCUMSTANCES, THE TRIBUNAL WAS OF THE VIEW THAT EN DS OF JUSTICE WOULD BE MET IF THE INCOME IS ESTIMATED @ 1 .5% OF THE NET RECEIPTS. CONSISTENT WITH THE VIEW TAKEN TH EREIN, WE DIRECT THE A.O. TO DETERMINE THE INCOME @ 1.5% OF T HE NET RECEIPTS. 4. THE NEXT CONTENTION OF THE ASSESSEE IS THAT WHILE ARRIVING AT THE FIGURE OF NET RECEIPTS, SERVI CE TAX, THE EMPLOYERS SHARE OF ESI, PF ETC., PAID BY THE CLIEN T COMPANIES TOWARDS STATUTORY PAYMENTS, HAVE TO BE EXCLUDED FROM THE TURNOVER FOR THE REASON THAT, NET PROFIT WOULD BE EMBEDDED IN THESE PAYMENTS. I AGREE WITH T HIS SUBMISSION AND DIRECT THE A.O. TO DEDUCT SUCH STATU TORY 3 ITA.NO.1421/HYD/2015 MR. AMDOORU RAJU GOUD, HYDERABAD. PAYMENTS FROM THE TURNOVER AND ARRIVE AT THE FIGURE OF NET TURNOVER BEFORE ESTIMATING THE INCOME OF 1.5% OF SU CH TURNOVER. IN CASE, THE RETURNED INCOME OF THE ASSES SEE IS HIGHER THEN WHAT IS SO DETERMINED BY THE A.O. THE R ETURN OF INCOME SHALL BE ACCEPTED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 17.06.2015. SD/- (J.SUDHAKAR REDDY) ACCOUNTANT MEMBER HYDERABAD, DATED 17 TH JUNE, 2016. VBP/- COPY TO 1. MR. AMDOORU RAJU GOUD, HYDERABAD C/O. SHRI S. RAMA RAO, ADVOCATE, FLAT NO.102, SHRIYAS ELEGANCE, 3-6-643, STREET NO.9, HIMAYATNAGAR, HYDERABAD 500 029. 2. THE INCOME TAX OFFICER, WARD - 8(3), I.T. TOWERS, A.C. GUARDS, HYDERABAD. 3. CIT(A) - 2, HYDERABAD. 4. PR. CIT - 2, HYDERABAD. 5. D.R. ITAT A BENCH (SMC) HYDERABAD. 6. GUARD FILE