Prasadam Srinivasa Rao , Hyderabad V. Income Tax Officer, Ward-9(5), Hyderabad

ITA 160/Hyd/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 6213 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2012-2013
• Appeal Filed On: 06-02-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Business income; Corroborative evidences
• Section: 143(3); 64; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD. BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER (THROUGH VIRTUAL HEARING) ITA NO.160/HYD/2019 (ASSESSMENT YEAR : 2012-13) SHRI PRASADAM SRINIVASA RAO, 8-17-260, NANDANAM COLONY, KARMANGHAT, HYDERABAD-500 079 PAN ANSPP3112B VS. INCOME TAX OFFICER, WARD 9(5), HYDERABAD. APPELLANT RESPONDENT APPELLANT BY : NONE. RESPONDENT BY : SHRI SUNIL KUMAR PANDEY (D.R.) DATE OF HEARING : 25.02.2021. DATE OF PRONOUNCEMENT : 06.04.2021. O R D E R PER SHRI S.S. GODARA, J.M. : THIS ASSESSEES APPEAL FOR THE ASST. YEAR 2014-15 ARISES FROM THE COMMISSIONER OF INCOME TAX (APPEALS)-7, HYDERABADS ORDER DT.13.11.2018 PASSED IN CASE NO.485/CIT(A)-7/2016-17, IN PROCEEDINGS UN DER SECTION 143(3) OF INCOME TAX ACT, 1961 (THE ACT). 2 ITA NO.160/HYD/2019 CASE CALLED TWICE. NONE APPEARED AT ASSESSEE'S BEH EST. WE ACCORDINGLY PROCEED EXPARTE AGAINST HIM. 2. WITH ABLE ASSISTANCE COMING FROM LEARNED DEPARTM ENTAL REPRESENTATIVES SIDE, WE NOTICE THAT THE CIT(APPEA LS) DETAILED DISCUSSION ESTIMATING 8% PROFIT ELEMENT IN HIS ALLEGED HAIR BUSINESS REA DS AS UNDER : 4. THE ONLY ISSUE INVOLVED IN THIS CASE IS ESTIM ATION OF INCOME FROM HAIR BUSINESS @10% THE ISSUE WAS DISCUSSED BY THE ASSESSING OFFI CER IN THE ASSESSMENT ORDER AS UNDER : A) THE ASSESSEE STATED THAT HE IS ENGAGED IN THE AC TIVITY OF TRADING IN HAIR. B) THE ASSESSEE STATED THAT HE SUPPLIED HAIR TO DIF FERENT PARTIES AND RECEIVED THE SALE PROCEEDS THROUGH HIS SB E/C AMOUNTING TO RS.17 .88 CRORES. C) AS PER THE INFORMATION AVAILABLE ON RECORD, THE OTHER PERSON MR.SUSHII KR MIRDHA, BY WHOM THE AMOUNTS WERE STATED TO HAVE BEEN DEPOSI TED IN. ASSESSEE'S BANK A/C, IS ALSO DEALING IN THE BUSINESS OF HAIR. D) ASSESSEE STATED THAT HE DOES NOT KNOW THE PERSON S WHO ACTUALLY PURCHASED THE STOCKS AND WHO DEPOSITED THE AMOUNTS TOWARDS PURCHA SE OF HAIR, BUT HE SUPPLIED STOCKS THROUGH MEDIATORS AND RECEIVED THE SALE PROC EEDS THROUGH BANK A/C, WHICH WERE DEPOSITED BY OTHER PARTIES. E) HENCE THE ENTIRE AMOUNT DEPOSITED IN ASSESSEE'S SB A/C REPRESENTS HIS SALES/TURNOVER, AND THE SAME HAS ALSO BEEN CONFESSE D BY THE ASSESSEE. F) ASSESSEE HAS NOT FURNISHED ANY QUANTITY DETAILS OF STOCKS SOLD OR PURCHASED, ETC., BUT CLAIMED THAT HE RECEIVES PROFIT OF ONLY 5 PAISE TO 10 PAISE PER KG. OF HAIR SOLD. G) ASSESSEE HAS ALSO NOT FURNISHED THE DETAILS OF M EDIATORS THROUGH WHOM THE DEALS WERE GOT DONE. H) DETAILS OF PERSONS WHO SUPPLIED THE STOCKS TO TH E ASSESSEE HAVE NOT BEEN FURNISHED. HOWEVER, LETTERS FROM FIVE PERSONS WERE SUBMITTED ON 27-12-16 STATING THEY ARE SOME OF THE SUPPLIERS . I) ASSESSEE DID NOT MAINTAIN ANY BOOKS OF A/C, BILL S, VOUCHERS, EVIDENCES AND CLAIMS THAT HE IS UNEDUCATED AND THE BUSINESS ACTIVITY CAR RIED WAS AN UNORGANIZED SECTOR. J) ALL THE AMOUNTS IN ASSESSEE'S ACCOUNT WERE RECEI VED THROUGH RTGS/CHEQUES FROM OTHER PARTIES. 3 ITA NO.160/HYD/2019 THE ASSESSEE CLAIMED THAT OUT OF THE TOTAL DE POSITS OF RS. 17.88 CR., THERE WERE WITHDRAWALS TO AN EXTENT OF RS, 17.62 CR FROM THE S AID BANK A/C TOWARDS PAYMENT TO HAIR SUPPLIERS AND EXPENSES FOR WHICH HE DID. N OT MAINTAIN, ANY RECORDS, BOOKS OF A/C., ETC. THE ASSESSEE FURTHER CLAIMED THAT THE PROFIT MARGIN IN THIS LINE OF BUSINESS IS VERY LESS AND OFFERED ADDITIONAL INCOME ON THE TURN OVER OF RS. 17.88 CR @ 0.25% AMOUNTING TO RS4,47,000/-. FROM THE ABOVE IT CAN BE REASONABLY INF ERRED THAT ENTIRE RECEIPTS ARE NOT DISCLOSED BY THE ASSESEE IN HIS RETURN OF INCOME FI LED. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING IN HAIR AND THE AMOUNTS IN THE BANK A/C WERE ALSO RECEIVED FROM A PERSON WHO IS ALSO DEALING IN THE BUSINESS O F TRADING IN HAIR, WHICH CLEARLY SHOWS THAT THESE RECEIPTS ARE BUSINESS RECEIPTS. IM PORTANTLY, THE BANK A/C WITH SBI BEARING NO.20031052771 IN WHICH CREDITS TO THE TUNE OF RS. 17.88 CR WERE MADE IS NOT DISCLOSED IN THE RETURN OF INCOME. THE ASSESSEE HAS NOT FURNISHED ANY MATERIAL EVIDENCE IN SUPPORT OF PURCHASES, EXPENSES INCURRED , DETAILS OF PERSONS FROM WHOM THE STOCKS WERE PURCHASED, TO WHOM HE SOLD THE STOC KS, DEDUCTIONS CLAIMED, ETC. FOR THE QUERIES RAISED WITH REGARD TO THE BUSINESS ACTIVITIES, THE ESSESSEE GAVE EVASIVE AND ANSWERS STATING THAT HE WAS NOT EDUCATE D, HE DID NOT MAINTAIN ANY BOOKS OF A/C., HE DOES NOT HAVE ANY PROOF EITHER FO R THE PURCHASES OR OTHER EXPENSES AND THE BUSINESS IN WHICH HE DEALT WITH IS AN UNORGANIZED SECTOR. IN VIEW OF THE FOREGOING FACTS AND CIR CUMSTANCES OF THE CASE, I AM LEFT WITH NO OTHER OPTION EXCEPT TO ESTIMATE THE PRATIT EARNE D BY THE ASSESSEE ON THE RECEIPTS IN RESPECT OF THE BUSINESS ACTIVITY CARRIE D OUT BY THE ASSESSEE. BUT AT THE SAME TIME THE PROFIT RATE WITH WHICH THE ASSESSEE C AME FORWARD I.E. 0.25% WAS TOO LOW TO BE ACCEPTED. IN VIEW OF THE NATURE AND VOLUM E OF BUSINESS, THE PROFIT IS ESTIMATED AT REASONABLE RATE OF 10% ON THE SALES AN D ACCORDINGLY THE ASSESSMENT IS COMPLETED BY ESTIMATING TOTAL INCOME AT RS. 1, 7 9,87,180/-. ' 5. DURING THE APPELLATE PROCEEDINGS, THE ASSESSEE V IDE HIS LETTER DATED 12.09.2018 HAS SUBMITTED AS UNDER: 'THE APPELLANT HAS BEEN CARRYING ON BUSINESS I N SUPPLYING OF HUMAN HAIR AND FILED RETURN OF INCOME FOR THE ASSESSMENT YEAR 2012 -13 ADMITTING AN INCOME OF RS. 1,76,380/-. THE APPELLANT USED TO COLLECT THE HAIR THRO UGH BEGGARS AND RAG PICKERS. AFTER COLLECTION OF THE HAIR, IT WILL BE CLEANED PRIMARIL Y AND SEGREGATED INTO DIFFERENT SIZES AND NO FURTHER ACTIVITY IS CARRIED ON THE HAIR PROC URED. THE SEGREGATED HAIR IS 4 ITA NO.160/HYD/2019 SUPPLIED IN KGS. TO DIFFERENT PARTIES UNKNOWN TO AP PELLANT THROUGH MEDIATORS ON BEHALF OF BEGGARS AND RAG PICKERS. MEDIATORS ARE PR OVIDED WITH DETAILS OF APPELLANT BANK ACCOUNT. AFTER SUPPLYING THE HAIR TO PARTIES U N KNOWN TO APPELLANT THROUGH MEDIATORS, BASED ON THE QUALITY AND SIZE, PRICE FOR THE HAIR IS FIXED BY THE PARTIES AND AMOUNT TRANSFERRED TO THE APPELLANT BANK ACCOUN T BY PARTIES UN KNOWN TO APPELLANT THROUGH MEDIATORS. ON RECEIPT OF THE AMOU NT FROM PARTIES THROUGH MEDIATORS, THE BEGGARS AND RAG PICKERS ARE PAID THE IR PRICE BASING ON PRICE DETERMINED BY THE PARTIES. THE ACTIVITY UNDER TAKEN BY THE APPELLANT IS IN UN ORGANISED SECTOR WHERE PROPER DOCUMENTARY EVIDENCE IS NOT AVAILABLE. THE APPELLANT SUBMITS THAT NO BILLS RAISED ON HIM FOR S UPPLY OF HAIR BY BEGGARS AND RAG PICKERS AND NO SALES INVOICES RAISED BY APPELLANT ' ON PARTIES UN KNOWN TO HIM OR MEDIATORS. THE APPELLANT USED TO GET AN INCOME FRO M 5 PAISE TO 10 PAISE PER KG. DEPENDING ON THE QUALITY OF HAIR SUPPLIED BY BEGGAR S AND RAG PICKERS. DURING THE ASSESSMENT YEAR 2012-13 AN AMOUNT OF RS.17,88,01,117 HAS BEEN CREDITED BY WAY OF ELECTRO NIC TRANSFERS SUCH AS NEFT AND RTGS IN THE SAVINGS BANK ACCOUNT MAINTAINED BY THE APPELLANT WITH STATE BANK OF INDIA, L.B.NAGAR BRANCH, HYDERABAD BEARING SAVINGS BANK ACCOUNT NO. 20031052771. COPY OF THE BANK ACCOUNT IS ENCLOSED H EREWITH FOR READY REFERENCE. DURING THE ASSESSMENT YEAR 2012-13 AN AM OUNT OF RS. 17.62 CR WERE PAID TO SUPPLIERS OF HAIR BY WAY OF NEFT, RTGS, CHEQUES AND CASH. THE LEARNED INCOME TAX OFFICER, WARD-9(5), HYDERABA D IS NOT JUSTIFIED IN MAKING AN ESTIMATION OF INCOME @ 10% RS.L,77,26,795 ON SAL ES OF RS.17,72,67,957/- AND RAISING A DEMAND OF RS. 84,86,790/-. THE LEARNED IN COME TAX OFFICER, WARD 9(5), HYDERABAD IS NOT JUSTIFIED IN MAKING ESTIMATION OF PROFIT OF 10% ON UNDISCLOSED SALES OF RS.17,72,67,957/AMOUNTING TO RS.1,77,26,79 5/-. THE LEARNED INCOME TAX OFFICER, WARD 9(5), HYDERABAD NOT STATED ANY BASIS FOR ADOPTING PROFIT RATE OF 10% ON UNDISCLOSED SALES OF RS.17,72,67,957/- AND ESTIM ATION OF AN INCOME THEREON RS. 1, 77,26, 795/-. THE APPELLANT SUBMITS THAT WITHOUT GIVING ANY BASIS OF ADOPTING 10% RATE OF PROFIT ON SALES, THE ADDITION CAN NOT BE SU STAINED. SIMILAR VIEW WAS TAKEN BY HONOURABLE IIFIGH COURT OF ANDHRA PRADESH IN THE CASE OF S. SARABAIAH SETTY & SONS V COMMISSIONER OF INCOME TAX [1.967J 64 ITR 17 5 (AP). THE APPELLANT PRAYS TO DELETE THE ADDITION OF RS.1,77,26,795 AND REDUCE T HE DEMAND RAISED. THE LEARNED INCOME TAX OFFICER IS NOT JUS TIFIED IN MAKING ESTIMATION OF 10% OF PROFIT ON SALES OF RS.17,72,67,957/- WITHOUT MAK ING ANY COMPARABLE STUDY AND GIVING JUSTIFICATION OF ESTIMATING INCOME @ 10% ON SALES. A SIMILAR VIEW WAS TAKEN 5 ITA NO.160/HYD/2019 IN THE CASE OF COMMISSIONER OF INCOME TAX - (CENTRA L), KANPUR V CARPET PALACE ({2014} 41 TAXMANN.COM 300 (ALLAHABAD) HIGH COURT O F ALLAHABAD. THE APPELLANT PRAYS TO DELETE THE ADDITION OF RS. 1, 77,26, 795/- . THE APPELLANT SUBMITS THAT THE ACTIVITY UNDER TAKEN BY THE APPELLANT IS IN UN- ORGANISED SECTOR OR INDUSTRY WHERE IN PROPER DOCUME NTARY EVIDENCE IS NOT AVAILABLE. THE APPELLANT SUBMITS THAT IN THIS LINE OF ACTIVITY, THE PROFIT MARGINS ARE VERY LOW AND THE APPELLANT EARNED FROM 5 PAISE TO 1 0 PAISE PER KG. OF HAIR SUPPLIED. THE LEARNED INCOME TAX OFFICER, WARD 9(5), HYDERABA D OUGHT TO HAVE CONSIDERED THE FACT THE ENVIROJ1MENT IN WHICH THE APPELLANT OP ERATED AND PREVAILING PROFIT MARGINS BEFORE ESTIMATING PROFIT RATE OF .10% ON SA LES. THE APPELLANT PRAYS TO DELETE THE ADDITION OF RS. 1,77,26,795 AND REDUCE T HE DEMAND RAISED. THE APPELLANT SUBMITS THAT CONFIRMATION L ETTERS FROM SUPPLIERS OF HAIR HAVE BEEN SUBMITTED AT RANDOM AT THE TIME OF ASSESSMENT. THE APPELLANT ALSO SUBMITS THAT THE DEPARTMENT HAS INFORMATION FROM WHOM THE E LECTRONIC TRANSFERS SUCH AS NEFT/RTGS HAVE BEEN RECEIVED. IN THE APPELLANT BANK ACCOUNT. THE LEARNED INCOME TAX OFFICER, WARD 9(5), HYDERABAD HAS NOT COMPARED AND CONSIDERED THE COLLECTIONS AND PAYMENTS FOR ARRIVING PROFITABILITY EARNED IN THIS LINE OF ACTIVITY BEFORE ARRIVING PROFITABILITY OF 10% ON SALES. THE APPELLANT PRAYS TO DELETE THE ADDITION OF RS 1, 77,26.795/- AND REDUCE THE DEMAND RAISED. THE APPELLANT SUBMITS THAT SUPPLIES HAVE BEEN MADE THROUGH AGENTS/MEDIATORS TO THE CUSTOMERS AND CUSTOMERS HAV E TRANSFERRED THE AMOUNTS BY WAY OF TRANSFERS AND RTGS TO THE APPELLANT ACCOU NT AND APPELLANT DOES NOT HAVE DIRECT ACCESS WITH CUSTOMERS. THE APPELLANT HAS MAD E ATTEMPTS TO GET CONFIRMATION LETTERS FROM CUSTOMERS THROUGH AGENTS BUT UNABLE TO RECEIVE TILL AT THE TIME OF SUBMISSION OF ADDITIONAL SUBMISSIONS. THE APPELLANT PRAYS TO OBTAIN THE CONFIRMATION LETTERS FROM CUSTOMERS WHO HAVE DEPOSI TED AND TRANSFERRED FUNDS TO THE BANK ACCOUNT AND ARRIVE CORRECT INCOME CONSIDER ING THE CONFIRMATION LETTERS SUBMITTED FOR PROCUREMENT OF HAIR. 6. I HAVE CAREFULLY CONSIDERED THE FINDINGS OF THE ASSESSING OFFICER IN THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE ASSESSEE DURING TH E APPELLATE PROCEEDINGS. THIS APPEAL IS AGAINST ESTIMATION OF PROFIT FROM TRADING OF HAIR AT 10% OF THE TURNOVER AS 6 ITA NO.160/HYD/2019 AGAINST THE PLEA OF THE APPELLANT TO ESTIMATE NET P ROFIT AT 0.25% TO 0.30 % OF TURNOVER. THE ASSESSING OFFICER OBSERVED THAT THE A PPELLANT HAD NOT DISCLOSED CERTAIN CREDITS IN BANK ACCOUNT, WHICH REPRESENTED THE SALE OF HAIR FOR INCOME TAX PURPOSES. THE TOTAL CREDITS IN THE BANK ACCOUNT WAS TO THE TUNE OF RS.17.88 CRORES AS AGAINST SALE/TURNOVER ALREADY OFFERED IN THE RET URN OF INCOME AT RS.15,33,160/-. IN THE ABSENCE-OF BOOKS OF ACCOUNTS, ANY BILLS AND VOUCHERS, THE ASSESSING OFFICER ESTIMATED THE NET PROFIT AT 10% OF THE SALES AND AS SESSED THE INCOME AT RS.L,79,87,180/- AS AGAINST RETURNED INCOME OF RS.L ,76,380/-. THE CONTENTION OF THE APPELLANT WAS THAT THE PROFIT MARGIN OF THE ASSESSE E RANGES FROM 0.25% TO 0.30% AND THE AR OF THE APPELLANT PLEADED FOR ADOPTION OF THE PROFIT AT 0.25% TO 0.30%. THE TURNOVER COMPUTED BY ASSESSING OFFICER ON THE B ASIS OF CREDITS IN THE BANK ACCOUNT WAS NOT DISPUTED. THE CONTENTION OF THE APP ELLANT BEFORE ASSESSING OFFICER WAS THAT THE NATURE OF BUSINESS IS IN THE UNORGANIZ ED SECTOR AND HE HAS NO EDUCATION BACKGROUND FOR NON-MAINTENANCE OF PROPER BOOKS OF ACCOUNTS AND OTHER RELEVANT DETAILS LIKE DAY TO DAY RECORDINGS, ROUGH NOTING, DETAILS OF PARTY WISE PAYMENTS. IN THE COURSE OF RESTRICTING THE NET PRO FIT AT ROUGH NOTING, DETAILS OF PARTY WISE PAYMENTS. IN THE COURSE OF APPELLATE PROCEEDIN GS, THE AR OF THE APPELLANT REITERATED THE PLEA FOR RESTRICTING THE NET PROFIT AT 0.30% OF SALES. IN SUPPORT OF THE CLAIM, THE AR OF THE APPELLANT REFERRED TO CERTAIN CONFIRMATIONS GIVEN BY PARTIES AND THE NOTINGS IN THE CONFIRMATION WERE EXACTLY SI MILAR. THE CONTENTS OF THE ONE OF THE CONFIRMATION ARE REPRODUCED BELOW FOR READY REFERENCE, IN ORDER TO PROPER APPRECIATION OF THE CASE: 'MY MAIN OCCUPATION IS TO COLLECT HAIR ON ROADS, DU STBINS, CANALS ETC. DURING THE ASSESSMENT YEAR 2012-13 I HAVE SUPPLIED HAIR TO MR. PRASADAM SRINIVASA RAO WHO IS SITUATED AT 8-7-260, NANDANAVANAM COLONY, KARMAN GHAT, HYDERABAD ; 500079. HE USED TO SUPPLY THE HAIR TO HIS PROSPECTIVE CUSTO MERS WHO DECIDE THE PRICE OF HAIR BEING ON THE QUALITY OF HAIR SUPPLIED TO HIM. ON DETERMINING THE PRICE, HE USED TO PAY ME THE PRICE FOR HAIR SUPPLIED TO HIM. I FUR THER SUBMIT THAT THE PRICE PER KG. OF HAIR WAS BETWEEN RS. 1,500 TO RS. 2,000 PER KG. DURING THE ASSESSMENT YEAR 2012- 13 BASING ON THE QUALITY OF HAIR SUPPLIED. I FURTH ER SUBMIT THAT I HAVE NOT MAINTAINED ANY BOOKS OR RECORDS FOR HAIR COLLECTED AND SUPPLIED TO MR. P.SREENIVASARAO -ES THE BUSINESS CARRIED WAS IN UN ORGANISED SECTOR AND THE VALUE OF HAIR SUPPLIED TO HIM WAS LESS THAN RS. 2 LAKHS I N A YEAR. 7 ITA NO.160/HYD/2019 THIS IS TRUE AND CORRECT INFORMATION TO THE BEST OF MY KNOWLEDGE. COPY OF MY AADHAR CARD BEARING NO. 698527849616 IS ENCLOSED HE REWITH FOR YOUR READY REFERENCE.' EXCEPT THE ABOVE, NO OTHER CIRCUMSTANTIAL EVIDENCES WERE PRODUCED BY THE APPELLANT DURING THE COURSE OF APPELLATE PROCEEDING S. ON PERUSAL OF THE SAME, I FIND THAT THE CONFIRMATIONS GIVEN BY THE PARTIES AR E GENERAL NATURE WITHOUT ANY DOCUMENTARY EVIDENCE SUCH AS BOOKS OF ACCOUNTS, BIL LS, LEDGER COPY ETC. IN SUPPORT OF CONFIRMATION. THEREFORE, THE CONFIRMATIONS PRODU CED BY THE APPELLANT FROM UNCONNECTED PARTIES WITHOUT ANY SUPPORTING DOCUMENT S HAVE NO RELEVANCE FOR THE DETERMINATION OF NET PROFIT EARNED BY THE APPELLANT . THE PLEA OF THE APPELLANT WAS THAT THE ESTIMATION OF NET PROFIT BY ASSESSING OFFI CER WAS EXCESSIVE. HOWEVER, NO SUPPORTING EVIDENCES WERE PRODUCED BY THE APPELLANT IN SUPPORT OF THE CLAIM THAT IT WAS ENGAGED IN THE COMMISSION BUSINESS ONLY AND ITS NET PROFIT DOES NOT EXCEED 0.30% OF THE SALES. HOWEVER, LOOKING INTO THE NATUR E OF THE BUSINESS, I FIND THAT THE DETERMINATION OF NET PROFIT AT 8% OF THE SALES IS R EASONABLE. HENCE, I DIRECT THE ASSESSING OFFICER STRICT ADDITION TO DETERMINATION OF PROFIT AT 8% OF THE SALES. 3. WE HAVE HEARD LEARNED DEPARTMENT REPRESENTATIVE AND PERUSED THE CASE FILE. SUFFICE TO SAY, THE ASSESSEE'S STAND TH ROUGHOUT IS THAT HE HAS BEEN CARRYING OUT HAIR BUSINESS A TOTALLY UNORGANIZED SECTOR WHER EIN PROFIT ESTIMATES @ 8% IS NOT AT ALL POSSIBLE. WE FIND NO MERIT IN THE ASSESSEE' S IMPUGNED STAND. A PERUSAL OF THE CASE FILE SUGGESTS THAT IF THE ASSESSEE'S STAND IS ACCEPTED THAT HAIR BUSINESS INVOLVES PROFIT ELEMENT @ 0.25% TO 0.30% ONLY HAVING TURNOVE R OF ALLEGED RS.17,88,01,117 THE QUANTITY OF HAIR STOCK WOULD INVOLVE MILLIONS O F KGS WHICH HAS NOWHERE SEEN PROVED IN THIS CASE. HONBLE APEX COURT LAND MARK DECISION IN SUMATI DAYAL VS. CIT 1995 AIR 2109 HOLDS THAT AN EXPLANATION TENDERED IN INCOME TAX P ROCEEDINGS HAS TO BE EXAMINED IN THE LIGHT OF HUMAN PROBABILIES. LEARNE D DEPARTMENT REPRESENTATIVE AT 8 ITA NO.160/HYD/2019 THIS STAGE TOOK US TO THE ASSESSEE'S STATEMENT RECO RDED DT.26.5.2016 DURING THE COURSE OF ASSESSMENT. HIS CASE IS THAT IF THE ASSESSEE'S EXPLANATION OF HIS INVOLVEMENT IN HAIR TRADE BUSINESS IS ACCEPTED, SUCH A HUGE QUANTI TY OF HAIR WOULD REQUIRE LOT OF GODOWN SPACE, LABOURERS, TRANSPORTATION, ETC WHICH HAS NOWHERE INDICATED EITHER AT THE TAX PAYERS OR LOWER AUTHORITIES BEHEST. WE A LSO NOTICE FROM A PERUSAL OF THE ASSESSMENT ORDER THAT THE ASSESSEE'S BANK ACCOUNT; STATED TO BE MAINTAINED BY HIMSELF AS A LABOURER HAD WITNESSED DEPOSITS TO THE TUNE O F RS.17.88 CRORES FROM ONE MR. SUNIL KUMAR MITTAL. NEEDLESS TO SAY, THE SAME CREA TES PRIMA FACIE DOUBTS IRRESPECTIVE OF THE ASSESSEE'S ALLEGED HAIR BUSINES S PLEA THROUGHOUT. BE THAT AS IT MAY, THE FACT ALSO REMAINS THAT THE ASSESSING OFFIC ER HAS HIMSELF ASSESSED THE ASSESSEE @ 10% PROFIT ONLY WHICH HAS BEEN RESTRICTE D TO 8% IN THE CIT(APPEALS) ORDER. WE THUS CONFIRM THE IMPUGNED PROFIT ELEMENT WITH A RIDER THAT THE CORRESPONDING LOWER AUTHORITIES FINDING THAT THE AS SESSEE IS ENGAGED IN HAIR BUSINESS SHALL NOT BE TREATED AS A PRECEDENT IN ANY OTHER AS SESSMENT YEAR IN VIEW OF OUR FOREGOING OBSERVATIONS. 4. THIS ASSESSEE'S APPEAL IS DISMISSED IN ABOVE TER MS. ORDER PRONOUNCED IN THE OPEN COURT ON 06.04.2021. SD/- SD/- (LAXMI PRASAD SAHU) (S.S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DT. 06.04.2021. * REDDY GP 9 ITA NO.160/HYD/2019 COPY TO : 1. SHRI PRASADAM SRINIVASA RAO, 8-17-260, NANDANAM COLONY, KARMANGHAT, HYDERABAD - 500 079 2. THE INCOME TAX OFFICER, WARD 9(5), HYDERABAD. 3. PR. C I T - 7 , HYDERABAD. 4. CIT(APPEALS)-7, HYDERABAD. 5. DR, ITAT, HYDERABAD. 6. GUARD FILE. BY ORDER SR. PVT. SECRETARY, ITAT, HYDE RABAD.