ITO, Ward-2(1), Coochbehar, Coochbehar V. Sri Dulal Chandra Saha, Kolkata

ITA 1945/KOL/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9866 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2019
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 23-07-2019
• Assessment Year: 2014-2015
• Appeal Filed On: 31-08-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOUDHUR Y
• Assessee Lawyers: P K SANGHAI
• Keywords: Peak credit
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B, BENC H KOLKATA BEFORE SHRI S.S.GODARA, JM &DR. A.L.SAINI, AM ./ITA NO.1945/KOL/2017 ( / ASSESSMENT YEAR:2014-15) ITO, WARD-2(1), COOCHBEHAR VS. SHRI DULAL CHANDRA SAHA SAHEBGANJ ROAD, DINHATA, COOCHBEHAR-736135 ./ ./PAN/GIR NO.: ATKPS 6788 C (ASSESSEE) .. (REVENUE) ASSESSEE BY : SHRI ROBIN CHOUDHURY, ADDL. CIT (DR ) RESPONDENT BY : SHRI P. K. SANGHAI, FCA / DATE OF HEARING : 23/07/2019 /DATE OF PRONOUNCEMENT : 25/09/2019 / O R D E R PER DR. A. L. SAINI: THE CAPTIONED APPEAL FILED BY THE REVENUE, PERTA INING TO ASSESSMENT YEAR 2014-15, IS DIRECTED AGAINST THE ORDER PASSED BY TH E COMMISSIONER OF INCOME TAX (APPEAL)-JALPAIGURI, WHICH IN TURN ARISES OUT OF AN ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME TAX ACT , 1961 (IN SHORT THE ACT) DATED 16/12/2016. 2. GROUNDS OF APPEAL RAISED BY THE REVENUE ARE AS FOLLOWS: 1. WHETHER, THE LD. CIT(A), JALPAIGURI HAS JUSTIFIED L IMITING THE ADDITION TO RS. 13,10,000/- DESPITE ACKNOWLEDGING THE UNDISCLOSED B ANK ACCOUNT WITH PEAK CREDIT OF RS. 15,09,200/-. SHRI DULAL CHANDRA S AHA ITA NO.1945/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 2 22 2 2. WHETHER THE LD. CIT(A), JALPAIGURI HAS JUSTIFIED IN DELETING THE ADDITION OF RS. 78,31,582/- ON ACCOUNT OF UNDISCLOSED PURCHASE IN C ONTRADICTION WITH DECISION OF THE JUDICIAL ITAT IN THE CASE OF DEBASISH BANERJ EE VS. ITO, (IT APPEAL NO. 124 & 125/KOL/2014) HONBLE ITAT KOLKATA BENCH A (3 RD FEBRUARY, 2015) 3. WHETHER THE LD. CIT(A), JALPAIGURI HAS JUSTIFIED IN DELETING THE ADDITION OF RS. 5,50,000/- ON ACCOUNT OF BOGUS ADVANCE ON THE BASIS OF THE FRESH EVIDENCES ADMITTED DURING THE APPELLATE PROCEDURE WITHOUT GIV ING OPPORTUNITY TO THE A.O. 4. THAT WHETHER THE LD. CIT(A), JALPAIGURI HAS JUSTIFI ED IN TELESCOPING OF UNDISCLOSED PROFIT OF RS. 2,71,460/- AND BOGUS ADV ANCE OF RS. 4,00,000/- WITH THE G.P. ADDITION DESPITE THE FACT THAT UNDISCLOSED CASH CREDIT IS NOT PART OF REGULAR BUSINESS TRANSACTION. 5. WHETHER, THE LD. CIT(A), JALPAIGURI HAS JUSTIFIED I N CONSIDERING THE ASSESSMENT ORDER U/S 143(3) IN THIS CASE AS THE ASSESSMENT MAD E ON ESTIMATE BASIS BY REJECTING THE BOOKS OF ACCOUNTS OF THE ASSESSEE [PA RA 5 OF CIT(A)S ORDER DATED 12.06.2017]. THE ORDER OF THE A.O. WAS NOT ON ESTIMATE BASIS. 6. THAT THE APPELLANT MAY PLEASE BE ALLOWED TO ADD AND /OR ALTER THE GROUNDS OF APPEAL, IF ANY. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. WE NOTE THAT LD. CIT(A) AFTER REJECTING THE BOOKS OF ACCOUNTS HAVE MADE ESTIMATE ADDITION AT THE RATE OF 1% OF RS. 13.1031 CRORES, W HICH CAME TO RS. 13,10,000/-. THE DETAILED FINDING OF THE LD. CIT(A) IS GIVEN BEL OW: I HAVE PERUSED THE ASSESSMENT ORDER AND THE SUBMIS SION OF THE A/R OF THE APPELLANT. I HAVE ALSO SEEN THAT M/S GUDDU AGENCY A ND M/S GITA SAHA HAVE CONFIRMED THE AMOUNT OUTSTANDING. THEREFORE, THESE TWO ADDITIONS STAND DELETED. HOWEVER, THE EXPLANATION OF THE APPELLANT REGARDING DUTTA AGENCY AND R. DUTTTA CANNOT BE ACCEPTED SINCE THESE PARTIES HAVE NOT ACK NOWLEDGED PAYMENT OF ADVANCE TO THE APPELLANT. THEREFORE, ADDITION OF RS . 4.00 LAKHS CAN BE CONFIRMED. HOWEVER THE SAME WOULD BE TELESCOPED WITH THE GP AD DITION I AM PROPOSING IN PARA 5. 5. DURING THE COURSE OF HEARING IT WAS POINTED OUT TO THE APPELLANT THAT THERE ARE NUMEROUS DIFFERENCE IN BOOKS OF ACCOUNTS OF THE APP ELLANT. THESE ARE (I) PRESENCE OF UNACCOUNTED BANK ACCOUNTS; (II) SUPPRESSION OF PURCHASE/TRANSACTION FROM M/S DIVYA JYOTI DISTRIBUTORS PVT. LTD AND M/S WEST BENGAL LOTTERY STOCKIST SYNDI CATE PVT. LTD.; AND (III) BOGUS ADVANCE SHOWN AGAINST THE NAME OF M/S DUTTA AGENCIES AND R DUTTA IN VIEW OF THIS DISCREPANCY IT WAS PROPOSED TO REJE CT THE BOOKS OF ACCOUNTS OF THE APPELLANT AND ESTIMATE THE PROFIT OF THE APPELLANT (THE A.O HAS ALSO REJECTED THE BOOKS OF' ACCOUNTS AND ESTIMATED THE PROFIT OF THE APPELLANT. HOWEVER IN MY SHRI DULAL CHANDRA S AHA ITA NO.1945/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 3 33 3 OPINION THE ESTIMATION IS AT THE VERY LOW FIGURE. ) THE AIR WAS ASKED ABOUT THIS VIDE ORDER SHEET NOTING DATED 08.06.2017. THE SAME IS REPRODUCED BELOW: SHRI MIHIR BANERJEE, A.R APPEARED, MADE WRITTEN SUB MISSION, ASKED TO GIVE COMPARABLE CASES OF LOTTERY BUSINESS. EXPRESSED HIS INABILITY TO GIVE ANY SUCH CASE. IT IS PROPOSED TO REJECT THE BOOKS OF ACCOUNT S AND ESTIMATED THE GROSS PROFIT AT 1% OF GROSS TURNOVER PLUS WHATEVER DECLARED BY A SSESSEE IN RETURN I.E. PROFIT WOULD BE ESTIMATED AT 1% OF (12.32 CRORE + 78.31 L AKH) + 8,51,300. THE A.R AGREED/OR THE ADDITION. CASE DISCUSSED AND HEARD. IN VIEW OF THE ABOVE THE NET PROFIT OF THE APPELLAN T WOULD INCREASE BY 1 % OF RS.12.32 CRORES PLUS RS.78.31 LAKHS I.E. 1% OF RS.1 3.10 CRORES WHICH COMES TO RS.13,10,000/-. THE ADDITION OF RS.2,71,460/- AND R S. 4.00 LAKHS BEING ADDITION ON ACCOUNT OF BOGUS ADVANCE AGAINST SALES GETS TELESCO PED WITH THIS G.P ADDITION. THEREFORE, THE TOTAL ADDITION OF THE APPELLANT WOUL D BE AS UNDER: TOTAL RETURNED INCOME RS. 3,09,240/- ADD: ADDITION ON ACCOUNT OF REJECTION OF BOOKS OF A CCOUNTS AND ESTIMATION OF GP RS. 13, 10,000/- TOTAL INCOME RS. 16,19,240/- 4. BEFORE US, THE LD. D.R. FOR THE REVENUE SUBMITTE D THAT ESTIMATED ADDITION AT THE RATE OF 1% WHICH IS DONE BY LD. CIT(A) IN HIS ORDER , AS NOTED ABOVE, IS VERY LOWER SIDE AND IT SHOULD BE 3.5% OF THE TURNOVER CONSIDER ING THE ASSESSEES FACTS AND CIRCUMSTANCES AND THE BUSINESS PRACTICES. THE LD. C OUNSEL FOR THE ASSESSEE HAS ALSO FAIRLY AGREED WITH THE PROPOSITIONS CANVASSED BY TH E LD. D.R. FOR THE REVENUE AND AGREED FAIRLY THAT THERE SHOULD BE 3.5% ESTIMATION ON THE TURNOVER. THEREFORE, CONSIDERING THE FACTS AND CIRCUMSTANCES, WE DIRECT THE ASSESSING OFFICER TO ESTIMATE 3.5% OF THE TURNOVER OF RS. 13.1031 CRORES WHICH COMES TO RS. 45,86,085/-. ACCORDINGLY, GROUND OF APPEAL RAISED B Y THE REVENUE IS PARTLY ALLOWED. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON 25.09.2019 SD/- ( S.S.GODARA ) SD/- (A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / DATE: 25/09/2019 ( SB, SR.PS ) SHRI DULAL CHANDRA S AHA ITA NO.1945/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 4 44 4 COPY OF THE ORDER FORWARDED TO: 1. ITO, WARD-2(1), COOCHBEHAR 2. SHRI DULAL CHANDRA SAHA 3. C.I.T(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 6. GUARD FILE. TRUE COPY BY ORDER ASSIST ANT REGISTRAR ITAT, KOLKA TA BENCHES