M/s. Saha Construction, Hooghly V. I.T.O., Wd-2(3), Hooghly, Hooghly

ITA 1516/KOL/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2674 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-04-2010
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 1999-2000
• Appeal Filed On: 28-08-2009
• Court: TRIBUNAL
• Department Lawyers: PIYUSH KOLHE
• Assessee Lawyers: ALAKESH KUNDU
• Section: 44AD; 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL 'B BENCH : KOLKATA (BEFORE HONBLE SRI B.R.MITTAL, J.M. AND HON BLE SRI B.C.MEENA, A.M.) I.T.A. NO. 1516 /KOL/2009 ASSESSME NT YEAR : 1999-2000 M/S SAHA CONSTRUCTION VS ITO, WARD 2(3), HOOGHLY (PAN NO. AAVFS 5028 F) (APPELLANT) (RESPONDENT) APPELLANT BY : SR I ALAKESH KUNDU. RESPONDENT BY : SRI PIYUSH KOLHE. O R D E R PER SHRI B.C.MEENA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE CIT(A)- XXXVI, KOLKATA DATED 29.06.09 FOR THE ASSESSMENT YE AR 1999-2000. 2. GROUNDS OF APPEAL READ AS UNDER : 1. THAT THE ASSESSMENT IS TOTALLY BAD IN LAW , AR BITRARY , UNJUSTIFIED & UNTENABLE AS NOTICE U/S 148 IS BARRED BY LIMITAT ION. 2. THAT THE LD. ITO INSTEAD OF TAKING PROFIT @ 8% AS PER U/S 44AD TOOK ENTIRE RECEIPT OF RS.2,18,284/- AS PROFIT WHICH IS HIGH, ARBITRARY AND UNTENABLE. WHETHER IT WAS HRA OR REGULAR PAYMENT W E DO NOT KNOW. 3. THAT THE LD. ITO DID NOT CONSIDER THE EXPENSES INCURRED FOR COMPLETION OF JOB FOR WHICH THE SAID PAYMENT WAS MADE. 4. THAT THE APPELLANT CRAVES LEAVE OF ADDUCING FURTHER EVIDENCES AT ANY STAGE OF THIS APPEAL PROCEEDING. 3. WHILE PLEADING ON BEHALF OF THE ASSESSEE, THE LE ARNED A.R. SUBMITTED THAT THE ASSESSEE WAS A CIVIL WORK CONTRACTOR. THE ASSE SSEE HAS FURNISHED THE RETURN OF INCOME ON 26.10.1999 WHICH WAS DULY PROCESSED U/S 143(1) OF THE I.T.ACT. AFTER A LONG PERIOD OF FIVE YEARS, THE A.O. ISSUED NO TICE U/S 148 OF THE INCOME TAX ACT . MEANWHILE ONE OF THE SENIOR PARTNERS WHO LOO KED AFTER THE ACCOUNTS WAS DIED. THE RECEIPT OF RS. 2,18,284 WAS NOT ADDED IN THE RECEIPTS SIDE. THE A.O. ISSUED THE NOTICE BY STATING THAT THE ASSESSEE HAS NOT SHOWN THE RECEIPT OF RS.2,18,284 WHICH CANNOT BE A BASIS FOR REOPENI NG, AS THE REOPENING CAN BE MADE ON THE BASIS OF ESCAPMENT OF INCOME RATHER THAN NON-DECLARING THE RECEIPTS. HE FURTHER PLEADED THAT THE ADDITION OF ENTIRE AMOUNT IS ALSO NOT 2 JUSTIFIED AS THE INCOME SHOULD HAVE BEEN WORKED OU T @ 8% OF THE RECEIPTS OF RS.2,18,284 AS PER THE PROVISIONS OF SECTION 44A D AND HE PLEADED TO SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW. 4. ON THE OTHER HAND, THE LEARNED D.R. RELIED ON THE ORDER OF THE A.O. AS WELL AS THE CIT(A). 5. AFTER HEARING BOTH THE SIDES , WE HOLD THAT TH E NOTICE U/S 148 OF THE INCOME TAX ACT WAS ISSUED AND DULY SERVED UPON T HE ASSESSEE. THE INCOME WHICH WAS ESCAPED WAS MORE THAN A LAKH AND AS PER THE PROVISIONS OF SECTION 149(1)(B) , THE NOTICE WAS WELL IN TIME AS THE LAW PERMITS TO REOPEN THE CASE WITHIN SIX YEARS WHERE INCOME CHARGEABLE TO TAX IS ONE LAKH OR MORE. FURTHER IT IS AN ADMITTED FACT THAT THE RECEIPTS OF RS.2,18,284 WERE NOT RECORDED IN THE RECEIPT SIDE OF THE PROFIT AND LOSS ACCOUNT. THEREFORE, T HERE WAS AN ESCAPEMENT OF INCOME AND THE CASE WAS RIGHTLY REOPENED BY THE A.O. WHI CH HAS BEEN DULY SUSTAINED BY THE CIT(A). FURTHER WE FIND THAT THERE IS NO DOCU MENT/EVIDENCE WHICH COULD PROVE THAT THE EXPENDITURE RELATING TO THESE RECE IPTS OF RS.2,18,284 WAS NOT DEBITED IN THE REGULAR PROFIT & LOSS ACCOUNT. THUS THE ASSESSEES CLAIM THAT THE INCOME SHOULD BE WORKED OUT AS PER THE PROVISIONS OF SECTION 44AD IS ALSO UNREASONABLE AND UNJUSTIFIED. THE EARLIER ASSESSM ENT WAS ALSO NOT MADE BY INVOKING THE PROVISIONS OF SECTION 44AD OF THE ACT . CONSIDERING THESE FACTS, WE HOLD THAT THE A.O. AS WELL AS THE CIT(A) WAS JUSTIFIED IN REOPENING THE ASSESSMENT AND ALSO BRINGING THE AMOUNT OF RS.2,18 ,284 FOR TAXATION. THE ENTIRE RECEIPTS REQUIRE TO BE TAXED IN VIEW OF THE FACT THAT NO EVIDENCE WAS FILED BY THE ASSESSEE WHICH COULD SHOW THAT EXPENDITURE RELAT ING TO THESE RECEIPTS WAS NOT DEBITED IN THE PROFIT AND LOSS ACCOUNT. IT IS ALSO NOT EXPLAINED IF NOT DEBITED THEN FROM WHAT SOURCE THESE EXPENSES WERE INCURRED. IN VIEW OF THESE FACTS , WE FIND NO MERIT IN THE APPEAL OF THE ASSESSEE. WE DISMIS S THE SAME. THUS ALL THE FOUR GROUNDS OF APPEAL RAISED BY THE ASSESSEE STAND DI SMISSED. 6. IN THE RESULT, THE ASSESSEES APPEAL IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON (B.R.MITTAL) (B.C.MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 3 COPY FORWARDED TO :- 1) ITO, WARD 2(3), HOOGHLY. 2) M/S SAHA CONSTRUCTION , VIVEKANANDA ROAD, PIPU LPATI, HOOGHLY. 3) CIT(A), KOLKATA. 4) CIT, KOLKATA. 5) D.R., ITAT, KOLKATA. BY ORDER ASSISTANT REGISTRAR I.T.AT., KOLKATA. BCD