M/S ARHAM JEWELLERS, Jaipur V. ITO, Jaipur

ITA 167/JPR/2012

• Counselvise Citation: 16723114 RSA 2012
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 23-02-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D K MEENA

Judgement Text

ITA 167-12 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH : SMC JAIPUR (BEFORE SHRI R.K.GUPTA) ITA NO.167/JP/2012 ASSTT. YEAR : 2007-08 M/S.ARHAM JEWELLERS, VS. THE INCOME TAX OFFICER (HQRS.) JAIPUR. JAIPUR. (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI D.K.MEENA DATE OF HEARING : 26.06.2012 DATE OF PRONOUNCEMENT : 28.06.2012 ORDER DATE OF ORDER : 28.06.2012 PER R.K.GUPTA, J.M. THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF LD.CIT(A) RELATING TO ASSESSMENT YEAR 2007-08. 2. THE ASSESSEE IS OBJECTING IN CONFIRMING THE REJE CTION OF BOOKS OF ACCOUNTS AND CONFIRMING THE ADHOC TRADING ADDITION OF RS.50,000/ -. 3. DURING THE ASSESSMENT PROCEEDING THE A.O. NOTED THAT THERE ARE UNVERIFIABLE PURCHASES OF RS. 12,92,951/- MADE FROM THREE PARTIE S. THOUGH ALL THE CONFIRMATION & ALL OTHER DETAILS ALONGWITH PURCHASE VOUCHERS, COMPLETE NAME AND ADDRESS WERE FILED. HOWEVER THESE PARTIES COULD NOT BE PRODUCED, THEREF ORE, AO MADE AN ADDITION OF RS.3,23,237/- BEING 25% OF UNVERIFIABLE PURCHASES B Y REJECTING THE BOOKS OF ACCOUNTS U/S 145(3) OF THE ACT. RELIANCE WAS ALSO PLACED BY THE AO IN CASE OF SANJAY OIL CAKE - 2 - PRODUCT AND VIJAY PROTEINS. DETAILED SUBMISSION WER E FILED BEFORE CIT(A). IT WAS FURTHER SUBMITTED THAT GROSS PROFIT RATE IS BETTER AS COMPA RE TO EARLIER YEARS. ALL THE REQUIRED DETAILS WERE FILED THEREFORE ADDITION MADE BY AO WA S NOT JUSTIFIED. RELIANCE WAS ALSO PLACED ON VARIOUS CASE LAWS. THE LD.CIT(A) AFTER CO NSIDERING THE SUBMISSIONS AND VARIOUS DECISIONS OF TRIBUNAL RESTRICTED THE ADDITI ON TO RS.50,000/- TO COVER POSSIBLE LEAKAGE OF THE PROFIT. 4. NONE APPEARED BEHALF OF ASSESSEE LD.D/R PLACED O N RELIANCE ON THE ORDER OF LD.CIT(A). 5. AFTER CONSIDERING THE ORDER OF AO & CIT(A). I FO UND THAT ASSESSEE DESERVED TO SUCCEED IN ITS APPEAL IN PART. THE TRIBUNAL IS TAKI NG A CONSISTENT VIEW THAT WHERE CERTAINED PURCHASES REMAIN UNVERIFIED THEN INVOCATION OF PROV ISION U/S 145(3) IS JUSTIFIED. ACCORDINGLY I CONFIRMED THE INVOCATION OF PROVISION U/S 145(3). THE TRIBUNAL IS ALSO TAKING A CONSISTENT VIEW THAT WHERE CERTAINED PURCHASE REMAIN UNVERIFIABLE THEY ADDITION SHOULD BE MADE ON THE BASIS OF PAST HISTORY AND TAKING INTO CONSIDERATION THE CURRENT EVENT OF THE CASE IN STEAD OF MAKING ADDITION 25% OR ANY PERCENTAGE OF UNVERIFIABLE PURCHASES. 6. IN THE PRESENT CASE THE G.P. RATE IS BETTER AS C OMPARE TO EARLIER YEAR. G.P. RATE IS SHOWN AT 27.42% IN COMAPRE TO THE EARLIER YEAR SHOW N AT 25.68%. SINCE CERTAINED PURCHASES REMAIN UNVERIFIABLE, THEREFORE, I FEEL TH AT IF AN ADDITION OF RS.25,000/- IS SUSTAINED THAT WILL MEET THE END OF JUSTICE. I ORDE R ACCORDINGLY. - 3 - 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART. 8. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 28. 06.2012. SD/- (R.K.GUPTA) JUDICIAL MEMBER JAIPUR, *BASANT* COPY FORWARDED TO :- M/S.ARHAM JEWELLERS, JAIPUR. THE INCOME TAX OFFICER(HQRS.) O/O COMMISSIONER OF I NCOME TAX-1, JAIPUR. THE CIT(A) THE CIT THE D/R GUARD FILE (ITA NO.167/JP/12) BY ORDER AR, ITAT, JAIPUR.