Dulichand Hanuman Prasad Shah, Jharsuguda V. ITO-Ward-2, Jharsuguda

ITA 185/CTK/2022

AI Insights

The case involves an appeal by M/s Dulichand Hanuman Prasad Shah against the order of the CIT(A)-2, Bhubaneswar, which was passed in relation to the assessment year 2014-2015. The primary contention was regarding the GP rate adopted by the AO, which was 2%, contrary to the 1.8% disclosed by the assessee. The assessee argued that the books of accounts were not rejected, and thus, the income should not have been estimated. The revenue contended that the assessee had not disclosed the turnover of the Rajgangpur Branch, leading to an estimation of income. The Tribunal, after reviewing the submissions and the assessment order, concluded that the AO's estimation without rejecting the books was incorrect and directed the adoption of the GP rate as disclosed by the assessee.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 127050 (ITAT-CUTTACK)
• Duration Of Justice: 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 19-02-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 04-12-2022
• Other Referred Cases: Ramchandra Ramnivas Vs. State of Orissa
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside

Judgement Text

आयकर अऩीऱीय अधधकरण, कटक न्यायऩीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK श्री जाजज माथन, न्याययक सदस्य एवं श्री अरुण खोड़पऩया ऱेखा सदस्य के समक्ष । BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER आयकर अऩीऱ सं/ITA No.185/C TK/2022 (ननधाारण वषा / Asses s m ent Year : 2014-2 015) M/s Dulichand Hanuman Prasad Shah Jhanda Chowk, Jharsuguda Vs ITO Ward-2, Jharsuguda PAN No. :AADFD 9273 B (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) ननधााररती की ओर से /Assessee by : Shri Rahul Agrawal, Advocate राजस्व की ओर से /Revenue by : Shri S.C.Mohanty, Sr-DR स ु नवाई की तारीख / Date of Hearing : 20/02/2023 घोषणा की तारीख/Date of Pronouncement : 20/02/2023 आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the order of the ld.CIT(A)-2, Bhubaneswar, dated 28.10.2022 passed in I.T.Appeal No.SBP/10267/2016-17, for the assessment year 2014-2015. 2. It was submitted by the ld. AR that the assessee had filed his return of income and the assessment came to be completed u/s.143(3) of the Act, wherein the AO has adopted 2% as GP as against 1.8% disclosed by the assessee. It was the submission that the AO has not rejected the books of accounts. It was submitted that before the ld. CIT(A) though the assessee has made his submission, however, the same was not considered. It was the submission that without rejecting assessee’s books of accounts the income of the assessee should not be estimated. He relied upon the decision of Hon’ble Jurisdictional High Court of Orissa in ITA No.185/CTK/2022 2 the case of Ramchandra Ramnivas Vs. State of Orissa, reported in [1970] 25 STC 501 (Orissa). 3. In reply, ld. Sr. DR submitted that the assessee as not disclosed the turnover of Rajgangpur Branch of the assessee. It was his submission that consequently the AO has estimated the assessee’s income. He placed reliance on the order of ld. CIT(A) at page 3. He vehemently supported the order of the ld. AO and ld. CIT(A). 4. We have considered the rival submissions. A perusal of the assessment order clearly shows that the AO has estimated the income of the assessee at 2% of the Rajgangpur Branch. Admittedly, the claim of the Sr. DR that the assessee has not disclosed the turnover of the Rajgangpur Branch does not find any mention in the assessment order or the order of the ld. CIT(A). A perusal of the assessment order also shows that the AO has mentioned that he has enquired the similar business of petrol pump and determined GP at 2%, however, the assessment order does not talk of any comparative case. A perusal of the assessment order also shows that the books of accounts of the assessee have not been rejected. This being so, we are of the view that the estimation of the income of the assessee as done by the AO without rejecting the books of accounts of the assessee is unsustainable and consequently the order of the ld. CIT(A) upholding the assessment done by the AO stands set aside and the AO is directed to adopt the GP rate as disclosed by the assessee. ITA No.185/CTK/2022 3 5. In the result, appeal of the assessee stands allowed. Order dictated and pronounced in the open court on 20/02/2023. Sd/- (अरुण खोड़पऩया) (ARUN KHODPIA) Sd/- (जाजज माथन) (GEORGE MATHAN) ऱेखा सदस्य/ ACCOUNTANT MEMBER न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनाांक Dated 20/02/2023 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनतलऱपऩ अग्रेपषत/Copy of the Order forwarded to : आदेशान ु सार/ BY ORDER, (Assistant Registrar) आयकर अऩीऱीय अधधकरण, कटक/ITAT, Cuttack 1. अऩीऱाथी / The Appellant- M/s Dulichand Hanuman Prasad Shah Jhanda Chowk, Jharsuguda 2. प्रत्यथी / The Respondent- ITO Ward-2, Jharsuguda 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. पवभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, कटक / DR, ITAT, Cuttack 6. गार्ज पाईऱ / Guard file. सत्यापऩत प्रयत //True Copy//