M/s Bharat Industries, Kolkata V. ACIT,Circle-48, Kol, Kolkata

ITA 1476/KOL/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4220 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 13-07-2016
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

1 ITA NO.1476/KOL/2016 BHARAT INDUSTRIES, AY 2009-10 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: KOL KATA [BEFORE SHRI M. BALAGANESH, AM & SHRI S. S. VISWAN ETHRA RAVI, JM] I.T.A NO. 1476/KOL/2016 ASSESSMENT YEAR: 2009-10 M/S. BHARAT INDUSTRIES (PAN:AADFB1901C) VS. ASSIS TANT COMMISSIONER OF INCOME-TAX, CIRCLE-48, KOLKATA. ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 18.11.2016 DATE OF PRONOUNCEMENT: 30.11.2016 FOR THE APPELLANT: SHRI ANIL KOCHAR, ADVOCATE FOR THE RESPONDENT: SALLONG YADEN, ADDL. CIT ORDER PER SHRI M. BALAGANESH, AM: THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A)-14, KOLKATA VIDE APPEAL NO. 346/CIT(A)-14/CIR-46/2011-12 DATED 30.05.2016. ASSESSMENT WAS FRAMED BY ACIT, CIRCLE-48, KOLKATA U/S. 143(3) OF THE INCOME TAX AC T, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR AY 2009-10 VIDE HIS ORDER DATED 28.12.20 11. 2. THE ONLY ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER THE LD CITA IS JUSTIFIED IN UPHOLDING THE ADDITION MADE TOWARDS NET PROFIT IN T HE SUM OF RS.2,38,719/- IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. BRIEF FACTS OF THIS ISSUE ARE THAT THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF MANUFACTURER OF FASTENERS. THE RETURN OF INCOME FOR THE AY 2009-10 WAS FILED ELECTRONICALLY ON 16.09.2009 DISCLOSING TAXABLE INC OME OF RS.19,37,489/-. THE ASSESSEE HAD REPORTED GROSS TURNOVER OF RS.12,43,54,759/-; GROSS PROFIT OF RS.89,87,993/- WHICH WORKS OUT TO 7.24% OF GROSS TURNOVER AND NET PROFIT OF RS .19,37,489/- WHICH WORKS OUT TO 1.56% OF TURNOVER. THE ASSESSEE PRODUCED THE BOOKS OF ACCOU NT AND RELEVANT BILLS AND VOUCHERS BEFORE THE AO WHICH WERE TEST CHECKED. THE AO MADE A COMPARISON OF THE GROSS PROFIT AND NET PROFIT DECLARED BY THE ASSESSEE VIS--VIS IMMED IATELY PRECEDING PREVIOUS YEAR AND FOUND THAT NET PROFIT DURING THE YEAR HAD DROPPED BY .09% AND ACCORDINGLY RESORTED TO ESTIMATE THE NET PROFIT AT 1.75% AS AGAINST 1.56% OF THE TOTAL T URNOVER THEREBY MAKING AN ADDITION OF 2 ITA NO.1476/KOL/2016 BHARAT INDUSTRIES, AY 2009-10 RS.2,38,719/- IN THE ASSESSMENT, WHICH ACTION WAS A LSO UPHELD BY THE LD. CIT(A) IN FIRST APPEAL. AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US ON THE FOLLOWING SOLE EFFECTIVE GROUND: 2. FOR THAT THE APPELLANT HAD EXPLAINED THE TRADI NG RESULT AND HAD CONTENDED THAT THE ADDITION MADE BY THE AO OF AN AMOUNT OF RS.2,38,719 /- WAS TOTALLY UNCALLED FOR AND THAT THE LD. CIT(A) OUGHT TO HAVE PROPERLY APPRECIATED THE C ONTENTIONS RAISED BY THE APPELLANT AND OUGHT TO HAVE DELETED THE ADDITION AS THE SAME WAS TOTALLY UNCALLED FOR. 4. THE LD. AR ARGUED THAT THE BOOKS OF ACCOUNT WERE PRODUCED BEFORE THE AO WHICH WERE NOT REJECTED AND IN SUCH A SCENARIO RESORTING TO ESTIMATION OF NET PROFIT IS NOT WARRANTED. IN RESPONSE TO THIS, THE LD. DR VEHEMEN TLY RELIED ON THE ORDER OF LD. CIT(A). 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE MATERIALS AVAILABLE ON RECORD. WE FIND LOT OF FORCE IN THE ARGUMENT OF THE LD. AR THAT WITHOUT RESORTING TO REJECTION OF BOOKS OF ACCOUNT BY POINTING OUT ANY SPECIFIC DEFEC T THEREON THE AO CANNOT RESORT TO ANY ESTIMATION OF PROFITS AND ACCORDINGLY, WE ARE DECLI NED TO ACCEPT THE ACTION OF AO. WE HEREBY DIRECT THE AO TO DELETE THE ADDITION MADE TO WARDS ESTIMATION OF NET PROFIT. ACCORDINGLY, THE GROUND RAISED BY ASSESSEE IS ALLOW ED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 30.11.2016 . SD/- SD/- (S.S. VISWANETHRA RAVI) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTAN T MEMBER DATED : 30TH NOVEMBER, 2016 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT M/S. BHARAT INDUSTRIES, C/O S. L. KOCHA R, ADVOCATE, 86, CANNING STREET, KOLKATA-700001 2 RESPONDENT ACIT, CIRCLE-48, KOLKATA 3 . THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .