Kumari Durga Ganpariwaru, Howrah V. ITO, Ward - 46(2), Kolkata, Kolkata

ITA 1428/KOL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1191 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 13-06-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P K MONDOL
• Assessee Lawyers: P J BHIDE
• Keywords: Business income; Depreciation; Principle of natural justice; Onus to prove

Judgement Text

IN THE INCOME TAX APPELLATE TR IBUNAL KOLKATA SMC BENCH, KOLKATA [BEFORE SRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER] I.T.A. NO. 1428/KOL/2017 ASSESSMENT YEAR: 2011-12 KUMARI DURGA GANPARIWARU.. ..APPELLANT 6/4, GOPAL BANERJEE LANE RAMKRISHNAPUR HOWRAH 711 101 [PAN : AJSPG 6393 D] INCOME TAX OFFICER, WARD-46(2).. ..RESPONDENT 3, GOVT. PLACE KOLKATA-700001 APPEARANCES BY: SHRI P.J. BHIDE, FCA, APPEARED ON BEHALF OF THE ASS ESSEE. SHRI P.K. MONDOL, ADDL. CIT, APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : OCTOBER 16, 2017 DATE OF PRONOUNCING THE ORDER : OCTOBER 31, 2017 O R D E R PER J. SUDHAKAR REDDY :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-14, KO LKATA (HEREINAFTER THE LD. CIT (A)), PASSED U/S 250 OF THE INCOME TA X ACT, 1961 (THE ACT), DT. 28/04/2017, FOR THE ASSESSMENT YEAR 201 1-12. 2. THE ASSESSEE IS AN INDIVIDUAL AND IS A DEALER OF IRON & STEEL. HE FILED HIS RETURN OF INCOME ON 02/05/2012, DISCLOSIN G TOTAL INCOME AT RS.7,39,163/-. 2 I.T.A. NO. 1428/KOL/2017 ASSESSMENT YEAR: 2011-12 KUMARI DURGA GANPARIWARU 2.1. THE ASSESSEE DID NOT PRODUCE THE BOOKS OF ACCO UNT BEFORE THE ASSESSING OFFICER. NO BILLS OR DOCUMENTS WERE PRODU CED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER, IN SUPPORT O F THE RETURN OF INCOME. THE ASSESSING OFFICER CONCLUDED THAT THE SA LE PARTIES AND THE PURCHASE PARTIES OF THE ASSESSEE ARE PRIMA FACIE NO T GENUINE. HENCE HE REJECTED THE AUDITED BOOKS OF ACCOUNT AND AFTER TAK ING THREE COMPARABLE CASES ESTIMATED THE NET PROFIT AT 0.54 P ER CENT OF THE TURNOVER. 2.1.1. ON APPEAL, THE LD. FIRST APPELLATE AUTHORITY , CONFIRMED THE SAME. FURTHER AGGRIEVED THE ASSESSEE IS BEFORE US ON THE FOLLOWING GROUNDS:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-14, KOLKATA, E RRED IN DISMISSING THE APPEAL OF THE APPELLANT WITHOUT GIVING ANY COGE NT REASONS. 2. THAT IN VIEW OF THE ANNEXURE TO THE FORM-35 AND THE FACT THAT THE ACCOUNTS OF THE APPELLANT WERE AUDITED, THE LD. COM MISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE HELD THAT THE AS SESSING OFFICER WAS NOT JUSTIFIED IN ESTIMATING NET PROFIT OF THE APPEL LANT @ 54% OF THE TURNOVER AND THEREBY CONFIRMING THE ASSESSING OFFIC ER'S DETERMINATION OF THE APPELLANT'S NON-SPECULATIVE BUSINESS INCOME AT RS.13,72,823/-. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFI RMING THE DISALLOWANCE OF THE APPELLANT'S DEDUCTION UNDER CHA PTER VIA OF THE ACT. 3. THAT THE ASSESSMENT ORDER PASSED BY THE LD. COMM ISSIONER OF INCOME TAX IS BAD IN LAW. 4. THAT THE APPELLANT CRAVES LEAVE TO SUBMIT FURTHE R GROUNDS, TO AMEND, ALTER OR OTHERWISE MODIFY THE GROUNDS ALREADY TAKEN , IF NECESSARY, BEFORE OR AT THE TIME OF HEARING OF THE APPEAL. 3. GROUND NO. 1, 3 & 4 ARE DISMISSED AS NOT PRESSED . 4. THE LD. COUNSEL FOR THE ASSESSEE SHRI P.J. BHIDE, ARGUES THAT THE NET PROFIT PERCENTAGE OF 0.54 PER CENT ADOPTED BY T HE ASSESSING OFFICER IS ARBITRARY AND EXCESSIVE. HE ARGUES THAT NO OPPOR TUNITY WAS GRANTED 3 I.T.A. NO. 1428/KOL/2017 ASSESSMENT YEAR: 2011-12 KUMARI DURGA GANPARIWARU BY THE ASSESSING OFFICER TO THE ASSESSEE TO EXAMINE THE COMPARABLE CASES AND THUS CAUSING VIOLATION OF PRINCIPLES OF N ATURAL JUSTICE. HE RELIES ON COMPARATIVE RESULTS FOR THE ASSESSMENT YE ARS 2011-12 & 2010-11 AND SUBMITS THAT THE PERCENTAGE OF GP IS 0. 47 PER CENT AND NET PROFIT MARGIN IS 0.32 PER CENT FOR ASSESSMENT YEAR 2011-12 AND 0.12 PER CENT FOR ASSESSMENT YEAR 2010-11. HE PLEADS THA T THE SAME MAY BE ADOPTED. HE FURTHER ARGUES THAT THE ASSESSMENT SHOU LD BE SET ASIDE AND THE ASSESSING OFFICER TO PROVIDE OPPORTUNITY TO THE ASSESSEE TO CROSS- EXAMINE THE COMPARABLE CASES. 5. THE LD. DR, SUBMITS THAT THE ASSESSEE HAS NOT PR ODUCED ANY EVIDENCE, WHATSOEVER, IN SUPPORT OF HIS CLAIM AND W AS DODGING AND AVOIDING THE ASSESSING OFFICER. HE SUBMITTED THAT N ONE OF THE CLAIMS OF THE ASSESSEE COULD BE SUBSTANTIATED AND NOT EVEN BA SIC RECORDS AND BOOKS OF ACCOUNTS HAVE BEEN PRODUCED BEFORE THE ASS ESSING OFFICER. HE RELIED ON THE ORDER OF THE ASSESSING OFFICER AS WEL L AS THE LD. CIT(A) AND SUBMITTED THAT THE SAME BE UPHELD. 6. AFTER HEARING RIVAL CONTENTIONS, I FIND THAT NO ARGUMENT IS ADVANCED FOR CONTROVERTING THE FACTUAL FINDING OF T HE LD. ASSESSING OFFICER THAT THE PARTIES TO SHOW SALES HAVE BEEN MA DE AND PARTIES FROM WHOM PURCHASES HAVE MADE AS CLAIMED BY THE ASSESSEE ARE PRIMA FACIE NOT GENUINE. THE ASSESSEE COULD NOT SUBSTANTIATE AN Y OF ITS CLAIMS MADE IN THE RETURN OF INCOME. THE LD. COUNSEL FOR T HE ASSESSEE COULD NOT CONTROVERT THE FINDING OF THE LD. CIT(A) THAT N OTHING IN THE AUDITED BOOKS SUBMITTED BY THE ASSESSEE WERE VERIFIABLE. UN DER THESE CIRCUMSTANCES, WE SEE NO REASON TO INTERFERE WITH T HE CONCURRENT FINDINGS OF THE REVENUE AUTHORITIES. ON THE ISSUE O F NATURAL JUSTICE, THE 4 I.T.A. NO. 1428/KOL/2017 ASSESSMENT YEAR: 2011-12 KUMARI DURGA GANPARIWARU ASSESSEE FAILED TO DISCHARGE THE BURDEN OF PROOF TH AT LAY ON HIM. WHEN THE ACCOUNTS PRODUCED ITSELF ARE UNVERIFIABLE, THE CLAIM OF THE ASSESSEE TO RELY ON THE SAME IS DEVOID OF MERIT. REGARDING T HE ALTERNATIVE CLAIM OF THE ASSESSEE THAT DEPRECIATION HAS TO PROVIDED, WE FIND STRENGTH IN THE ARGUMENTS OF THE LD. DR THAT SECTION 44AF OF THE ACT WHICH PROVIDES FOR COMPUTATION OF PROFIT IN THE CASE OF R ETAIL BUSINESS DEEMS DEPRECIATION TO HAVE BEEN PROVIDED WITHOUT ESTIMATI NG THE INCOME @ 5 PER CENT OF THE TURNOVER. THE CIRCULAR OF THE BOA RD, DT. 31/08/1965, RELIED UPON BY THE ASSESSEE WAS MUCH BEFORE THE INT RODUCTION OF THE SECTION 44AF OF THE ACT, AND HENCE OF NO AVAIL. 6.1. SIMILAR, IS THE DECISION OF THE HONBLE ALLAHAB AD HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. BISHAMBHAR DAYAL AND CO.. JUDGEMENT DT. NOVEMBER 11 TH , 1993. AS THE BOOKS ITSELF ARE NOT RELIABLE AND ARE NOT VERIFIABLE, THE CLAIM OF THE ASSESSEE T HAT HE HAS FURNISHED THE REQUIRED PARTICULARS FOR CLAIM OF DEPRECIATION CANNOT BE ACCEPTED. HENCE, WE UPHOLD THE CONCURRENT FINDINGS OF THE REV ENUE AUTHORITIES AND DISMISS THIS APPEAL OF THE ASSESSEE. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. KOLKATA, THE 31 ST DAY OF OCTOBER, 2017. SD/- [ J. SUDHAKAR REDDY ] ACCOUNTANT MEMBER DATED :31.10.2017 {SC SPS} 5 I.T.A. NO. 1428/KOL/2017 ASSESSMENT YEAR: 2011-12 KUMARI DURGA GANPARIWARU COPY OF THE ORDER FORWARDED TO: 1. KUMARI DURGA GANPARIWARU 6/4, GOPAL BANERJEE LANE RAMKRISHNAPUR HOWRAH 711 101 2. INCOME TAX OFFICER, WARD-46(2) 3, GOVT. PLACE KOLKATA-700001 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVATE SECRETARY HEAD OF OFFICE/ D.D.O. ITAT, KOLKATA BENCHES