Shri Raj Kumar, Gurgaon V. ITO, Gurgaon

ITA 1681/DEL/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4146 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2012-2013
• Appeal Filed On: 21-03-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SATISH KUMAR GUPTA SENIOR
• Keywords: Depreciation; Additional evidence; Agreed addition; Set aside
• Section: 32; 68; 145; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F : NEW DELHI) BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.1681/DEL./2017 (ASSESSMENT YEAR : 2012-13) SHRI RAJ KUMAR, VS. ITO, WARD 3 (3), C/O KUNAL AGGARWAL & ASSOCIATES, GURGAON (HARYANA) . 226, JMD MEGAPOLIS, 2 ND FLOOR, SECTOR 48, SOHNA ROAD, GURGAON 122 001 (HARYANA). (PAN : AWDPK3434D) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI SATISH KUMAR GUPTA, SENIOR DR DATE OF HEARING : 17.02.2020 DATE OF ORDER : 20.02.2020 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, SHRI RAJ KUMAR (HEREINAFTER REFERRED TO AS THE ASSESSEE) BY FILING THE PRESENT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 09.02.2017 PASSED BY THE COMMI SSIONER OF INCOME - TAX (APPEALS)-1, GURGAON QUA THE ASSESSME NT YEAR 2012-13 ON THE GROUNDS INTER ALIA THAT :- 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WHE THER THE LD CIT(A)-L GURGAON, WAS JUSTIFIED IN CONFIRMING THE E STIMATION OF NET PROFIT @12% OF THE TURNOVER IGNORING THE GUIDEL INES ITA NO.1681/DEL./2017 2 PRESCRIBED BY HON'BLE PUNJAB AND HARYANA HIGH COURT IN THE CASE OF TELELINKS V. CIT 377 ITR 158? 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WHET HER THE LD. CIT(A)-L GURGAON, WAS JUSTIFIED IN CONFIRMING T HE ADDITION OF OUTSTANDING SUNDRY OF RS.2,13,58,136/- AS ON 31. 03.2012 U/S 68 OF THE INCOME TAX ACT, 1961? 3. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WHET HER THE LD. CIT(A)-L GURGAON, WAS JUSTIFIED IN NOT ALLOWING THE DEPRECIATION U/S 32 OF THE INCOME TAX ACT,1961 AND IN IGNORING THE CIRCUMSTANTIALLY AVAILABLE FIXED ASSET BILL AND REGISTRATION CERTIFICATES IN SUPPORT OF PURCHASE OF FIXED ASSETS COMPLETELY? 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE ISSUE AT HAND ARE : ASSESSEE FILED RETURN OF INCOME AT RS.6,58,220/- WHICH WAS PUT TO SCRUTINY PROCEEDINGS. ON FAILURE OF THE ASSESSEE TO PROVE THE BOOKS OF ACCOUNTS IN THE SHAPE OF LEDG ER, CASH BOOK, BANK BOOK, ETC. ALONG WITH SUPPORTING BILLS AND VOU CHERS, ASSESSING OFFICER (AO) INVOKED THE PROVISIONS OF SE CTION 145 (3) OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT) AND REJECTED THE BOOKS OF ACCOUNT. 3. ASSESSEE DECLARED GROSS RECEIPTS OF RS.5,95,63,0 00/- AND CLAIMED EXPENSES OF RS.5,88,55,182/- UNDER VARIOUS HEADS AND HAS DECLARED THE NET PROFIT OF RS.7,07,818/- IN THE PRO FIT & LOSS ACCOUNT WHICH COMES TO 1.15%. HOWEVER, AO ESTIMATED THE NE T PROFIT @ 12% KEEPING IN VIEW THE AVERAGE NET PROFIT RATE IN THE SIMILAR SECTOR OF BUSINESS AND THEREBY MADE AN ADDITION OF RS.71,47,560/- - RS.7,07,818/- (ALREADY SHOWN THE PROFIT & LOSS ACCO UNT) = RS.64,39,742/-. AO ALSO MADE ADDITION OFRS.2,13,58 ,136/- U/S 68 ITA NO.1681/DEL./2017 3 OF THE ACT ON FAILURE OF THE ASSESSEE TO FILE REPLY /CONFIRMATIONS FROM ITS CREDITORS. 4. ASSESSEE CARRIED THE MATTER BY WAY OF AN APPEAL BEFORE THE LD. CIT (A) WHO HAS CONFIRMED THE ADDITION BY DISMI SSING THE APPEAL. FEELING AGGRIEVED, THE ASSESSEE HAS COME U P BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT APPEAL. 5. ASSESSEE HAS NOT PREFERRED TO PUT IN APPEARANCE DESPITE ISSUANCE OF THE NOTICE AND CONSEQUENTLY, WE PROCEED ED TO DECIDE THE PRESENT APPEAL WITH THE ASSISTANCE OF THE LD. D R AS WELL AS ON THE BASIS OF DOCUMENTS AVAILABLE ON THE FILE. 6. WE HAVE HEARD THE LD. SENIOR DEPARTMENTAL REPRES ENTATIVE FOR THE REVENUE TO THE APPEAL, GONE THROUGH THE DOC UMENTS RELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES B ELOW IN THE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 7. UNDISPUTEDLY, ASSESSEE HAS FAILED TO PRODUCE THE BOOKS OF ACCOUNT IN THE SHAPE OF LEDGER, BANK BOOK, CASH BOO K, ETC. ALONG WITH SUPPORTING BILLS AND VOUCHERS BEFORE THE AO. EVEN DURING THE APPELLATE PROCEEDINGS BEFORE THE LD. CIT (A), ASSES SEE HAS FAILED TO PRODUCE THE BOOKS OF ACCOUNT RATHER CHALLENGED THE ESTIMATION OF PROFIT RATES ON THE GROUND THAT AS COMPARED TO EARL IER YEARS PROFIT RATES, THE RATE OF 12% IS NOT JUSTIFIED. ASSESSEE HAS ALSO FAILED TO PROVE THE LIABILITY OF RS.2,13,58,136/- BY PRODUCIN G CONFIRMATION ITA NO.1681/DEL./2017 4 FROM HIS SUNDRY CREDITORS. WHEN THE ASSESSEE HAS C ATEGORICALLY ADMITTED BEFORE THE LD. CIT (A) THAT HE IS UNABLE T O PRODUCE BOOKS OF ACCOUNT AND SUPPORTING VOUCHERS, WE SEE NO SCOPE TO INTERFERE INTO THE ESTIMATION OF NET PROFIT @ 12% BY THE AO A ND CONFIRMED BY THE LD. CIT (A). 8. SO FAR AS QUESTION OF MAKING AN ADDITION OF RS.2 ,13,58,136/- ON ACCOUNT OF NON-CONFIRMATION BY THE SUNDRY CREDIT ORS TO PROVE THE LIABILITY CLAIMED BY THE ASSESSEE IS CONCERNED, DURING APPELLATE PROCEEDINGS ASSESSEE FILED CONFIRMATIONS WITH REGAR D TO 4 SUNDRY CREDITORS, NAMELY, KONARK SALES CORPORATION, GANPAT I TRADERS, S.R. INDUSTRIES GASES & SHREE RAMA TYRE OF RS.11,23,437. 50, RS.33,48,780/-, RS.4,52,792.28 & RS.5,88,904.08 RES PECTIVELY QUA WHICH ADDITIONAL EVIDENCE WAS ADMITTED BY CALLING T HE REMAND REPORT FROM THE AO. HOWEVER, LD. CIT (A) PROCEEDED ON THE PREMISE THAT THE ASSESSEE ADMITTED BEFORE THE AO TH AT ADDITION ON ACCOUNT OF SUNDRY CREDITORS WAS AN AGREED ADDITION. HOWEVER, LD. CIT (A) ALSO PROCEEDED TO EXAMINE THE CONFIRMATIONS OF ONLY 4 CREDITORS OUT OF THE SUNDRY CREDITORS ON MERITS AND PROCEEDED TO CONFIRM THE ADDITION ON THE GROUND THAT THE ASSESSE E HAS FAILED TO FURNISH THE EVIDENCE TO PROVE THE GENUINENESS OF TH E SUNDRY CREDITORS. SO, WE FIND NO SCOPE TO INTERFERE INTO THE FINDINGS ITA NO.1681/DEL./2017 5 RETURNED BY THE LD. CIT (A) WHEN THE ASSESSEE HAS H IMSELF NOT BROUGHT ON RECORD THE EVIDENCE TO SUPPORT HIS CLAIM . 9. SO FAR AS QUESTION OF DISALLOWING THE DEPRECIATI ON U/S 32 OF THE ACT ON VEHICLES I.E. TRUCKS AND CARS BY THE AO AS WELL AS LD. CIT (A) IS CONCERNED, WE ARE OF THE CONSIDERED VIEW THAT WHEN THE ASSESSEE HAS FAILED TO PRODUCE THE PURCHASE BILLS W ITH REGARD TO VEHICLES ON WHICH THE DEPRECIATION WAS CLAIMED AND HAS ALSO FAILED TO PRODUCE THE FABRICATION COST OF RS.10 LACS PER T RUCK INCLUDED IN THE COST, THE DEPRECIATION HAS BEEN RIGHTLY DISALLO WED BY THE AO AND CONFIRMED BY THE LD. CIT (A). MOREOVER, THE AS SESSEE HAS NOT MADE ANY SUCH CLAIM OF DEPRECIATION ON VEHICLES IN THE RETURN OF INCOME FILED. SO, AGAIN WE FIND NO SCOPE TO INTERF ERE WITH THE FINDINGS RETURNED BY THE LD. CIT (A). 10. RESULTANTLY, THE APPEAL FILED BY THE ASSESSEE I S DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THIS 20 TH DAY OF FEBRUARY , 2020. SD- SD/- (O.P. KANT) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 20 TH DAY OF FEBRUARY, 2019 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-7, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.