M/s Prestigious Agri Reserch & Development Private Limited., Belagavi V. The Assistant Commissioner of Income Tax, Circle-1, Belagavi., Belagavi

ITA 2/PAN/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 7497 (ITAT-PANAJI)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 03-01-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SHIVENDRA GUPTA LD
• Assessee Lawyers: RAJENDRA B JOSHI
• Keywords: Gross profit estimation; Corroborative evidences

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI SINGLE MEMBER CASE BEFORE SHRI GEORGE MATHAN, HONBLE JUDICIAL MEMBER ITA NO. 0 2 /PAN/201 7 (ASST. YEAR : 20 07 08 ) M/S. P RESTIGIOUS A G RI RESEARCH & DEVELOPMENT PRIVATE LIMITED 636, KALMATH ROAD RAVIVAR PETH, BELGAUM V. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1 BEL A GAVI PAN NO. AACCP 9049 D (APPELLANT) (RESPONDENT) ITA NO. 0 3 /PAN/2017 (ASST. YEAR: 20 07 08 ) M/S HITECH F E RTFOODS PRIVATE LTD., 636, KALMATH ROAD RAVIVAR PETH, BELGAUM V. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1 BELGAVI PAN NO. AAACH 5115 J (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RAJENDRA B JOSHI - CA DEPARTMENT BY : SHRI SHIVENDRA GUPTA LD. DR DATE OF HEARING : 1 5 /03/ 2017 DATE OF PRONOUNCEMENT : 1 5 /0 3 /2017 . O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER 1 . THESE ARE THE TWO APPEA L S FILED BY THE ASSESS EES AGAINST THE O RDER OF THE LEARNED CIT(A) BELAGAVI IN APPEAL NO ITA.NO.482/BGM/2009 10 DATED 27.10.2016 FOR THE ASSESSMENT YEAR 2007 08 I N THE CASE OF M/S P RESTIGIOUS AGRI RESEARCH & DEVELOPMENT PRIVATE LIMITED AND ITA.NO. 0 2 & 03 /PAN/201 7 M/S PRESTIGIOUS AGRI RESEARCH & DEVELOPMENT PVT, LTD. & M/S HIGHTECH FERTIFOODS PURCHASE PVT. LTD. 2 ITA.NO.462/BGM/2009 10 DATED 27.10.2016 FOR THE ASSESSMENT YEAR 2007 08 IN THE CASE OF M/S. HITECH FERTIFOODS PVT. LTD. 2 . AS THE ISSUE IN BOTH THE APPEAL S ARE IDENTICAL AND THE ASSESSEES ARE SISTER CONCERN S THE APPEALS ARE DISPOSED OF BY THIS COMMON ORDER. 3 . SH RI RAJENDRA B JOSHI, C A REPRESENTED ON BEHALF OF THE ASSESSEE S AND SHRI SHIVENDRA GU PTA REPRESENTED ON BEHALF OF THE REVENUE. 4 . IT WAS SUBMITTED BY THE LEARNED AUTHORIZED REPRESENTATIVE OF THE ASSESSEE THAT THERE WERE TWO ISSUES IN BOTH THE APPEALS. THE FIRST ISSUE WAS AGAINST THE ACTION OF THE LEARNED CIT(A) IN CONFIRMING THE ESTIMATION OF THE GROSS PROFIT AT 6% AS AGAINST 2.63% DISCLOSED BY THE ASSESSEE M/S PRESTIGIOUS AGRI RESEARCH & DEVELOPMENT PRIVATE LIMITED AND 4.35% DISCLOSED BY M/S. HITECH FERTIFOODS PVT. LTD. LEARNED AUTHORIZED REPRESENTATIVE OF THE ASSESSEE DR EW MY ATTENTION TO THE ASSESSMENT ORDER . IT WAS SUBMISSION THAT THE BOOKS OF ACCOUNTS OF THE ASSESSEE HAS NOT BEEN REJECTED IN THE COURSE OF THE ASSESSMENT AND THE P ROVISION OF SECTION 142(2) HAS NOT BEEN INVOKED. IT WAS SUBMISSION THAT THE ASSESSING OFFICER HAS ALSO NOT GIVEN ANY REASON OR JUSTIFI CATION NOR LEARNED CIT(A) , FOR ESTIMATING THE GROSS PROFIT OF THE ASSESSEE AT 6%. IT WAS SUBMISSION THAT IN VIEW OF THE DECISION OF THE HONBLE GAUHATI HIGH COURT IN THE CASE OF THE ALUMINIUM INDUSTRI ES (P) LTD. V. COMMISSIONER OF INCOME TAX REPORTED IN ( 1995 ) 80 TAXMAN 0 184 THE ADDITION ON ACCOUNT OF THE LOWER GROSS PROFIT WAS LIABLE TO BE DELETED. IN REPLY LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND CIT(A). 5 . I HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERUSAL OF THE ASSESSMENT ORDER AS ALSO THE ORDER OF THE LEARNED CIT(A) CLEARLY SHOWS THAT THE BOOKS OF ACCOUNT HAVE NOT BEEN REJECTED AND THE GROSS PROFIT OF ITA.NO. 0 2 & 03 /PAN/201 7 M/S PRESTIGIOUS AGRI RESEARCH & DEVELOPMENT PVT, LTD. & M/S HIGHTECH FERTIFOODS PURCHASE PVT. LTD. 3 THE ASSESSEE HAS BEEN ESTIMATED BY SIMPLY MENTIONING NOT MAINTENANCE OF BOOKS OF ACCOUNTS PROPERLY . WHAT IS THE DEFECT IN THE BOOKS OF ACCOUNT MAINTAIN ED HAS NOT BEEN POINTED OUT. IN THE CIRCUMSTANCES RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE GA U HATI HIGH COURT IN THE CASE OF ALUMINIUM INDUSTRIE S (P) LTD. V. COMMISSIONER OF INCOME TAX REFER R ED (SUPRA) THE ADDITION ON ACCOUNT OF THE ESTIMATION OF THE GROSS PROFIT STANDS DELETED. 6 . IT WAS SUBMISSION OF THE LEARNED DEPARTMENTAL REPRESENTATIVE THAT THE SECOND ISSUE WAS IN RESPECT OF THE ADDITION MADE ON ACCOUNT OF THE DIFFERENCE IN THE BALANCE S IN RESPECT OF THE SOME OF THE CREDITORS. THE LEARNED AUTHORIZED REPRESENTATIVE OF THE ASSESSEE PLACED BEFORE ME COPIES OF THE RECONCILIATION ST ATEMENT WITHOUT ANY SUPPORTING EVIDENCE. ON A SPECIFIC QUESTION AS TO WHAT IS THE EVIDENCE TO SUPPORT RECONCILIATION , IT WAS SUBMITTED BY THE LEARNED AUTHORIZED REPRESENTATIVE OF THE ASSESSEE T HAT THEY HAD BEEN PRODUCED BEFORE THE ASSESSING OFFICER IN THE COURSE OF THE REMAND PROCEEDINGS. IT WAS SUBM ISSION THAT THE ADDITION MAY BE DELETED. IN REPLY LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT IN THE ORIGINAL ASSESSMENT , NOR BEFORE THE CIT(A) NOR IN THE REMAND PROCEEDINGS , ASSESSEE PRODUCE D THE EVIDENCE. IT WAS SUBMISSION THAT IN RESPECT OF THE EVIDENCE PRODUCED BY THE ASSESSEE IN THE REMAND PROCEEDINGS THE LEARNED CIT (A) HAS DELETED SOME OF THE ADDITIONS. IT WAS SUBMISSION THAT THE BALANCE OF THE ADDITIONS WHICH IS I N APPEAL BEFORE THE TRIBUNAL WAS ON ACCOUNT OF THE ADDITIONS WHICH HAS BEEN CO NFIRMED BY THE CIT(A) AS THE EXPLANATION OF THE ASSESSEE WAS NOT ACCEPTABLE AS THE APPROPRIATE PROOF FOR THE SAME WAS NOT SUBMITTED. IT WAS SUBMISSION THAT THE ADDITIONS AS CONFIRMED BY T HE LEARNED CIT(A) WAS LIABLE TO BE UPHELD. 7 . I HAVE CONSIDERED THE RIVAL SUBMISSIONS. ADMITTEDLY THOUGH ASSESSEE S HAS PRODUCED RECONCILIATION STATEMENTS BEFORE THIS TRIBUNAL THE ITA.NO. 0 2 & 03 /PAN/201 7 M/S PRESTIGIOUS AGRI RESEARCH & DEVELOPMENT PVT, LTD. & M/S HIGHTECH FERTIFOODS PURCHASE PVT. LTD. 4 SAME IS NOT SUPPORTED BY ANY EVIDENCE . IN FACT PERUSAL OF THE ORDER OF THE CIT(A) ALSO CLEARLY SHOWS THA T THE ADDITION HAVE BEEN CONFIRMED BY THE LEARNED CIT(A) SPECIFICALLY ON THE ACCOUNT THAT THE RECONCILIATION IS NOT SUPPORTED BY THE EVIDENCE. THIS BEING SO AS THE ASSESSEE S ARE UNABLE TO PRODUCE THE EVIDENCE TO SUPPORT RECONCILIATION STATEMENT , THE ADDITION ON ACCOUNT OF SECTION 41 A S CONFIRMED BY THE LEARNED CIT(A) STANDS CONFIRMED. 8 . IN THE RESULT THE APPEALS OF THE ASSESSEES ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING ON WEDNESDAY , THE 1 5 TH DAY OF MARCH , 2017 AT GOA. SD/ - (GEORGE MATHAN) JUDICIAL MEMBER DATED : 1 5 TH MARCH , 2017. VSSGB / - COPY TO: 1 . THE ASSESSEE. 2 . THE REVENUE. 3 . THE CIT 4 . THE CIT(A), 5 . THE D.R. 6 . GUARD FILE. BY ORDER ASSISTANT REGISTRAR I.T.A.T., PANAJI