ASHWIN KHEMKA, MUMBAI V. DCIT 23(1), MUMBAI

ITA 1628/MUM/2012

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3136 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 22-04-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 07-03-2012
• Court: TRIBUNAL
• Department Lawyers: VINITA MENON
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI R. C. SHARMA , ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ./ I.T.A. NO. 1628/MUM/2012 ( / ASSESSMENT YEAR: 2006 - 07 ) ASHWIN KHEMKA 205, P. NO. KOTHARI ESTATE, L. B. S. ROAD, BHANDUP WEST, MUMBAI - 400 078 / VS. DY. CIT - 23(1), MUMBAI ./ ./ PAN/GIR NO. AAGPK 7500 B ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI MEHUL SHAH / RESPONDENT BY : SMT. VINITA MENON / DATE OF HEARING : 22.4.2016 / DATE OF PRONOUNCEMENT : 23.6 .2016 / O R D E R PER R. C. SHARMA, A. M.: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER BY THE LD. CIT(A) FOR A.Y. 2006 - 07 IN TH E MATTER OF ORDER PASSED U/S. 143(3) OF THE INCOME TAX ACT . 2. RIVAL CONTENTIONS HAVING BEE N HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT THAT THE RE WAS A SURVE Y ACTION CONDUCTED ON THE PREMISES OF THE ASSESSEE ON FEBRUARY 9, 2006 WHEREIN A DISCLOSURE WAS MADE OF RS.40,19,449/ - AS UNDER: 2 ITA NO. 1628/MUM/2012 (A.Y. 2006 - 07) ASHWIN KHEMKA VS. DY. CIT RENOV ATION EXPENSES RS.8,01,000/ - JEWELLERY PURCHASE RS.12,00,000/ - EXCESS CASH RS.4,04,135/ - UNACCOUNTED STOCK RS.16,14,31 4/ - THE ASSESSEE ADJUSTED THE ABOVE DISCLOSURE AGAINST THE NET LOSS AS PER THE PROFIT AND LOSS ACCOUNT AND NET INCOME OF RS.16,91,260/ - WAS DECLARED IN TH E RETURN OF INCOME. DURING THE COURSE OF ASSESSMENT, THE ASSESSEE SUBMITTED TWO SETS OF PROFIT AND LO SS ACCOUNT PRE SURVEY AND POST SURVEY. THE PRE SURVEY P & L A/C SHOWED NET LOSS OF RS.22,19,575/ - , WHE REAS THERE WAS A PROFIT OF RS.66,77,370/ - AS ON THE DATE OF SURVEY. THE AO CONSIDERED THE TRADING AND P & L A/C FILED UPTO THE DATE OF SURVEY AS WELL AS AFTER THE DATE OF SURVEY. P & L ACCOUNT S O FILED BY THE ASSESSEE WAS RECASTED BY THE A O WHEREIN PROFIT WAS ARRIVED AT RS.11,96,589/ - AS AGAINST LOSS OF RS.22,90,575/ - SHOWN BY THE ASSESSEE. I T WAS CONTENDED BY THE ASSESSEE THAT THE A.O. HAS NOT CONSIDERED THE PURCHASES MADE AMOUNTING TO RS.35,93,912/ - . THE CASE WAS REMITTED BACK BY THE CIT(A) TO THE A.O. I N THE REMAND REPORT, THE A O FOUND THAT THE PURCHASES WAS SHOWN FROM A SISTER CONCERN AND WHICH WAS NOT DISCLOSED AT THE TIME OF SURVEY AND IT WAS ONLY ME ANT TO REDUCE THE PROFIT SO ARRIVED AT. ACCORDINGLY , HE REJECTED THE ASSESSEES CONTENTION AND AFTER CONSIDER ING THE DISCLOSURE SO MADE ASSESSED INCOME AT RS.49,51,480/ - . THUS, AN ADDITION OF RS.35,93,912/ - WAS MADE BY THE AO AND CONFIRMED BY CIT(A) . THE A SSESSEE IS IN FURTHER APPEAL BEFORE US. 3. WE HAVE CONSIDERED THE RIVAL CON T E N TIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM THE RECORD THAT WITHOUT SHOWING ANY GENUINE AND COGENT REASON , THE ASSESSEE HAS SHOWN LOSS DU RING THE YEAR UNDER CONSIDERATION AND WORKED OUT THE GROSS LOSS AT RS.15,76,195/ - . THUS THE GP AS PER THE CALCULATION FURNISHED BEFORE US WORKS OUT AT NEGATIVE OF 3.53% AS AGAINST GP OF 3.32% TO 5.97% IN THE EARLIER YEARS. HOWEVER, THE A.O. HAS NOWHERE REJ ECTED THE BOOKS OF ACCOUNT, THEREFORE, CONSIDERING THE TOTALITY AND FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO 3 ITA NO. 1628/MUM/2012 (A.Y. 2006 - 07) ASHWIN KHEMKA VS. DY. CIT KEEPING IN VIEW THE GP RATE SHOWN BY THE ASSESSEE IN THE EARLIER YEAR, WE DIRECT T H E A.O. TO RECOMPUTE THE INCOME BY TAKING GROSS PROFIT RATE O F 3.23% AS AGAINST NEGATIVE GP RATE SHOWN BY THE ASS ESSEE AT 3.52%. THUS, THE A.O. HA S TO RECOMPUTE THE NET PROFIT AFTER APPLYING GP RATE OF 3.32%. WE DIRECT ACCORDINGLY. 4. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED IN PART. ORDER PRONOUNCED IN THE OPEN COURT ON J UNE 23, 201 6 SD/ - SD/ - ( PAWAN SINGH ) ( R. C. SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / MUMBAI ; / DATED : 23 . 0 6 .201 6 . . ./ ROSHANI , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI