Shivaji Anandrao Powar, Kolhapur V. Income-tax Officer,

ITA 1708/PUN/2015

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 8625 (ITAT-PUNE)
• Duration Of Justice: 5 year(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 12-01-2021
• Assessment Year: 2008-2009
• Appeal Filed On: 29-12-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Section: 44AD; 133A; 148; 6; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE (THROUGH VIRTUAL COURT) BEFORE SHRI INTURI RAMA RAO , ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, J UDICIAL M EMBER . / I TA NO S . 1708 TO 1711 /PUN/20 15 / ASSESSMENT YEAR S : 2008 - 09 TO 2011 - 12 SHRI SHIVAJI ANANDRAO POWER, SUSHANT S. PHADNIS, CA, 613 , E - WARD, PHADNIS CHAMBERS, SHAHUPURI, 1 ST LANE, KOLHAPUR - 416 001 . PAN : AHZPP0195M ....... / APPELLANT / V/S. THE INCOME TAX OFFICER WARD - 1, ICHALKARANJI KOLHAPUR. / RESPONDENT A SSESSEE BY : NONE REVENUE BY : SHRI S.P. WALIMBE / DATE OF HEARING : 12 . 01 .202 1 / DATE OF PRONOUNCEMENT : 12 . 01.2021 / ORDER PER PARTHA SARATHI CHAUDHU RY, JM : THESE FOUR APPEALS PREFERRED BY THE ASSESSEE EMANATES FROM THE COMMON ORDER OF THE LD. CIT(APPEALS) - 2, KOLHAPUR DATED 30.10.2015 FOR THE ASSESSMENT YEARS 2008 - 09 TO 2011 - 12 AS PER THE GROUNDS OF APPEAL ON RECORD. 2 ITA NO S . 1708 TO 1711 /PUN/20 15 A.Y S . 2008 - 09 TO 2011 - 12 2. AT THE TIME OF HEARING, NONE APPEARED FOR AND ON BEHALF OF THE ASSESS EE. THOUGH NOTICE WAS DULY SERVED AND AS RECORDED THAT EVEN IN THE EARLIER OCCASION S ALSO, THERE WERE NON - COMPLIANCE FROM THE ASSESSEE ON THE GIVEN DATE S OF HEARING. THE LD. DR SUBMITTED THAT IN ALL THESE APPEALS, ISSUES ARE IDENTICAL AND FACTS ARE COMMON AND THEREFORE, ALL THESE CASES WERE HEARD AND DISPOSED OF TOGETHER VIDE THIS CONSOLIDATED ORDER ON MERITS AFTER RECORDING THE SUBMISSIONS OF THE LD. DR AND MATERIALS AVAILABLE ON RECORDS. 3. THE BRIEF FACTS OF THE CASE ARE THAT A SURVEY OPERATION U/S.133A OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS CONDUCTED IN BUSINESS PREMISES OF THE ASSESSEE ON 31/08/2012. IT WAS FOUND THAT ASSESSEE DID N OT MAINTAI N REGULAR BOOKS OF ACCOUNT AND DID NOT GET HIS ACCOUNTS AUDITED. TH E ASSESSEE IS A SUB - CONTRACTOR EXECUTING CIVIL WORKS. HE KEPT ONLY SELF - MADE VOUCHERS FOR EXPENSES AND FEW FILES SHOWING BILLS RAISED AND PAYMENTS RECEIVED. THESE FILES , DOCUMENTS AND VOUCHERS WERE IN VENTORIZED AND IMPOUNDED U/S. 133A OF THE ACT . THE ASSESSING OFFICER NOTED THAT AS PER SECTION 44AD OF THE ACT , IN COME OF THE ASSESSEE SHOULD BE 8% OF THE TURNOVER. HOWEVER, IN NONE OF THESE FOUR YEARS ASSESSEE HAS RETURNED INCOME AT 8% OR MORE . THEREFORE, CASES WERE TAKEN UNDER SCRUTINY BY ISSUE OF NOTICES U/S. 148 OF THE ACT . ASSESSEE DID NOT REPLY TO VARIOUS NOTICES ISSUED BY ASSESSING OFFICER WHEREUPON THE ASSESSING O FFICER HAD RESORTED TO ESTIMATE ASSESSEE'S INCOME U/S.144 OF THE ACT THROUGH BEST JUDGMENT ASSESSMENT . HE HAS FOUN D THAT IN REPLY TO QUESTION NO. 18 IN THE STATEMENT RECORDED UNDER SECTION 133A OF THE ACT , THE ASSESSEE HAS OFFERED INCOME @ 10% ON THE RECEIPTS AND HAD STATED THAT TAXES WOULD BE PAID ON THIS AMOUNT. THE ASS ESSING OFFICER ALSO NOTED THAT BOOKS OF ACCOUNT WE RE NOT 3 ITA NO S . 1708 TO 1711 /PUN/20 15 A.Y S . 2008 - 09 TO 2011 - 12 MAIN TAINED AND AUDITED. THEREFORE, ASSESSING OFFICER HAS ADOPTED A RATE OF 10% IN ALL THESE YEARS AND ASSESSED THE INCOME ACCORDINGLY. 4. THAT IN THE APPELLATE PROCEEDINGS BEFORE THE LD. CIT(APPEALS ), IT WAS CONTENDED BY THE ASSESSEE THAT THE ASSESSING OFFICER HAS NOT POINTED OUT ANY DISCREPANCIES IN THE SEIZED MATERIAL ON THE BASIS OF WHICH HE REJECTED ASSESSEES BUSINESS RESULT. THE ASSESSING OFFICER ALSO DID NOT PROVIDE ANY REASON FOR ESTIMATING INCOME @10% BESIDES WHAT THE ASSESSEE HAS STATED IN HIS STATEMENT. THE ASSESSING OFFICER HAS ASKED THE ASSESSEE TO EXPLAIN CERTAIN QUERIES REGARDING COMPUTATION OF HIS INCOME; HOWEVER, THE SEIZED MATERIALS WERE IN THE POSSESSION OF DEPARTMENT. UNDER SUCH CIRCUMSTANCES, THE ASSESSEE COULD NOT PREPARE THE REQUIRED DETAILS. THAT FURTHER, THE ASSESSEE SUBMITTED BEFORE THE LD. CIT(APPEALS) THAT THE ASSESSING OFFICER HAS ALSO NOT PROVIDE D COPY OF STATEMENT OF THE ASSESSEE. THE ASSESSEE HAD CONTENDED THAT DURING THE SURVEY, HE WAS MADE TO SIGN THE STATEMENT WITHOUT PROVIDING A COPY OF THE SAME. FROM THESE FACTS, IT WAS OPINED BY THE LD. CIT(APPEALS) THAT IF THE ASSESSEE WAS NOT PROVIDED WITH COPY OF SEIZED MATERIAL AND STATEMENT, MUCH RELIANCE CANNOT BE PLACED ON THE FIGURE OF 10% ADOPTED BY THE ASSESSING OFFICER. 4.1 THE LD. CIT(APPEALS) FURTHER OBSERVED THAT THE ASSESSING OFFICER HAS NOT BROUGHT ON RECORD WHAT ARE THE EXPENSES CLAIMED BY THE ASSESSEE AGAINST THE TURNOVER AND WHICH OF THESE EXPENSES ARE UNRELIA BLE. ON THE OTHER HAND, FIGURES OF INCOME RETURNED BY THE ASSESSEE ARE ALSO NOT SACROSANCT AS HIS BOOKS OF ACCOUNTS ARE NOT AUDITED. AS PER SECTION 44AD, THE PRESCRIBED RATE AS A THUMB RULE IN ASSESSEES LINE OF BUSINESS IS 8% OF TURNOVER. IN CASE AN ASSES SEE CLAIMS THAT HIS PROFITS ARE BELOW 8%, HE MUST MAINTAIN BOOKS OF ACCOUNT AND GET THE M AUDITED AND THESE CONDITIONS, THE ASSESSEE HAS TO 4 ITA NO S . 1708 TO 1711 /PUN/20 15 A.Y S . 2008 - 09 TO 2011 - 12 COMPLY WITH. IN THE PRESENT CASE, THE ASSESSEE DID NOT COMPLY WITH THE SAME. THEREFORE, THE PROFIT BELOW 8% WAS NOT A CCEPTED BY THE LD. CIT(APPEALS). ON THE OTHER HAND, HE OPINED THAT THERE WA S NO JUSTIFICATION FOR TAKING THE PROFIT RATE OF 10% ON THE BASIS OF STATEMENT U/S.133A OF THE ACT WHICH HAS NO EVIDENTIARY VALUE. THE ASSESSING OFFICER SHOULD HAVE USED THIS STATEM ENT AS A STARTING POINT AND MARSHALED FURTHER FACTS FROM IMPOUNDED MATERIALS TO JUSTIFY THE RATE OF 10%. THAT IN ORDER TO BALANCE BETWEEN THE INTERESTS OF ASSESSEE AS WELL AS THAT OF REVENUE, THE LD. CIT(APPEALS) ADOPTED A RATE OF 8% AS PER SECTION 44AD OF THE ACT IN CONSONANCE WITH THE LINE OF BUSINESS OF THE ASSESSEE. 5. THAT BEFORE US, IN ALL THESE APPEALS ONLY GROUND TAKEN BY THE ASSESSEE IS THE ESTIMATION OF THE ASSESSEES INCOME AT THE RATE OF 8% BY THE LD. CIT(APPEALS). WE HAVE PERUSED THE CASE REC ORDS, ANALYZED THE FACTS AND CIRCUMSTANCES IN THESE CASES AND RECORDED THE SUBMISSIONS OF THE LD. DR. WE HAVE ALSO PERUSED THE MATERIALS AVAILABLE ON RECORDS. IT IS VERY MUCH EVIDENT STARTING FROM THE STAGE OF ASSESSMENT THAT SEVERAL OPPORTUNITIES WERE PRO VIDED TO THE ASSESSEE BY THE ASSESSING OFFICER IN ORDER TO REPRESENT HIS CASE ON MERITS. HOWEVER, THE ASSESSEE HAS EVADED THE ENTIRE ASSESSMENT PROCEEDINGS. THEREFORE, THERE WAS NO ALTERNATIVE LEFT BEFORE THE ASSESSING OFFICER BUT TO RESORT TO BEST JUDGMENT ASSESSMENT U/S.144 OF THE ACT CONSIDERING THE MATERIALS AVAILABLE ON RECORD. THE ASSESSING OFFICER HAS ESTIMATED ASSESSED INCOME OF THE ASSESSEE AT THE RATE OF 10%. THE LD. CIT(APPEALS) IN HIS FINDINGS HAS VERY JUDICIOUSLY ANALYZED THE ENTIR E FACTS AND CIRCUMSTANCES OF THE CASE CONSIDERING PRACTICALITIES OF LINE OF BUSINESS IN WHICH THE ASSESSEE WAS INVOLVED AND HAD, THEREAFTER, HELD THE ASSESSEES INCOME ESTIMATING AT THE RATE OF 8% AS PER SECTION 44AD OF THE ACT. 5 ITA NO S . 1708 TO 1711 /PUN/20 15 A.Y S . 2008 - 09 TO 2011 - 12 6. THE LD. CIT(APPEALS) H AD OBSERVED THAT THE ASSESSING OFFICER HAS NOT POINTED OUT ANY DISCREPANCIES IN THE SEIZED MATERIAL WHILE REJECTING THE ASSESSEES BUSINESS RESULT. THE ASSESSING OFFICER HAS ALSO NOT GIVEN ANY SPECIFIC REASON FOR ESTIMATING INCOME AT THE RATE OF 1 0%. THAT FURTHER, THE ASSESSEE W AS ALSO NOT GIVEN COPY OF THE STATEMENT RECORDED IN THE COURSE OF SURVEY AND NEITHER, THE COPY OF SEIZED MATERIALS WAS PROVIDED TO THE ASSESSEE. THAT SIMILARLY, THE LD. CIT(APPEALS) HAS ALSO OBSERVED THAT THE FIGURES OF I NCOME RETURN ED BY THE ASSESSEE WE RE ALSO NOT SACROSANCT AS HIS BOOKS OF ACCOUNT S WE RE NOT AUDITED. THAT AS PER SECTION 44AD OF THE ACT, THE PRESCRIBED RATE AS A THUMB RULE IN ASSESSEES LINE OF BUSINESS IS 8% OF TURNOVER. IN CASE AN ASSESSEE CLAIMS THAT HIS PROFITS A RE BELOW 8%, HE MUST MAINTAIN BOOKS OF ACCOUNT AND GET THE M AUDITED. THESE EXERCISES WE RE NOT DONE BY THE ASSESSEE. 7. THEREFORE, IN THE INTEREST OF JUSTICE, THE LD. CIT(APPEALS) HAD APPLIED THE RATE OF 8% AS PER SECTION 44AD OF THE ACT TO THE INCOME OF T HE ASSESSEE CONSIDERING HIS AREA OF BUSINESS. THUS, WE ARE OF THE CONSIDERED VIEW THAT THE FINDINGS OF THE LD. CIT(APPEALS) ARE ABSOLUTELY REASONABLE AND A S PER LAW . THEREFORE, THE SAME DOES NOT CALL FOR ANY INTERFERENCE. HENCE, THE FINDINGS OF THE LD. CIT (APPEALS) ARE UPHELD. 8. IN THE RESULT, ALL THE FOUR APPEALS OF THE ASSESSEE ARE DISMISSED. ORDER PRO NOUNCED ON 12 TH DAY OF JANUARY , 20 2 1 . SD/ - SD/ - INTURI RAMA RAO PARTHA SARATHI CHAUDHURY ACCOUNTANT MEMBER JUDICIAL MEMBER / PUNE; / DATED : 12 TH JANUARY , 202 1 SB 6 ITA NO S . 1708 TO 1711 /PUN/20 15 A.Y S . 2008 - 09 TO 2011 - 12 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(APPEALS) - 2, KOLHAPUR. 4. THE CIT - II, KOLHAPUR. 5 . , , , / DR, ITAT, A BENCH, PUNE. 6 . / GUARD FILE. / BY ORDER, // TRUE COPY // / PRIVATE SECRETARY , / ITAT, PUNE . 7 ITA NO S . 1708 TO 1711 /PUN/20 15 A.Y S . 2008 - 09 TO 2011 - 12 DATE 1 DRAFT DICTATED ON 12 . 01 .202 1 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 12 . 01 .202 1 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER