Shri Anand M Kannur, Bijapur V. ITO, Bijapur

ITA 20/BANG/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 5136 (ITAT-BANGALORE)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-07-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 16-06-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 07-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JACINTA ZIMIK VASHAI
• Assessee Lawyers: NITYA
• Keywords: Presumptive income; TDS
• Section: 44AD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO.20/BANG/2010 ASSESSMENT YEAR : 2005-06 SHRI ANAND M. KANNUR, CIVIL & GOVT. CONTRACTOR, AT POST : ATHARGA TALUKA : INDI. DIST. BIJAPUR. : APPELLANT VS. THE INCOME TAX OFFICER, WARD II, BIJAPUR. : RESPONDENT APPELLANT BY : SMT. NITYA, ADVOCATE RESPONDENT BY : SMT. JACINTA ZIMIK VASHAI, ADDL. C IT(DR) O R D E R PER A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER THIS APPEAL OF THE ASSESSEE, AN INDIVIDUAL, IS DIRE CTED AGAINST THE ORDER OF THE CIT (A), BELGAUM, IN ITA NO: 70/BJP/06 -07 DATED 20.10.2009 FOR THE ASSESSMENT YEAR 2005-06. 2. THE ASSESSEE HAS RAISED THREE GROUNDS, OUT OF W HICH, GROUND NOS: 1 AND 3 BEING GENERAL AND NO SPECIFIC ISSUES I NVOLVED, THEY HAVE BECOME NON-CONSEQUENTIAL. IN THE REMAINING GROUND, THE ESSENCE OF THE ISSUE WAS THAT THE AUTHORITIES BELOW HAVE ERRED IN CALCULATING TH E ITA NO.20/BANG/10 PAGE 2 OF 3 PROFIT/INCOME U/S 44AD ON THE ENTIRE CONTRACT WORKS INCLUDING A POTION OF WHICH WAS SUB-LET TO SUB-CONTRACTORS. 3. BRIEFLY STATED, THE ASSESSEE CIVIL CONTRACTOR HAD SHOWN GROSS RECEIPTS FROM CIVIL CONTRACT BUSINESS AT RS.2 3.93 LAKHS INCLUSIVE OF RS.14 LAKHS OF CONTRACT WORKS SUB-LET TO SUB-CONTRA CTORS FOR EXECUTION. THE ASSESSEE HAD ADMITTED A NET PROFIT U/S 44AD OF THE ACT (EXCLUSIVE OF CONTRACT SUB-LET TO THE SUB-CONTRACTORS) AT 8% PLUS NET PROFIT AT 2% BEING SUB-CONTRACT PAYMENTS MADE. 4. ACCORDING TO THE AO, AS PER THE TDS CERTIFICATE , THE ENTIRE GROSS CONTRACT RECEIPTS WERE PAID TO THE ASSESSEE W HICH WAS LESS THAN RS.40 LAKHS. IN VIEW OF THE ABOVE, THE AO TOOK A D IVERGENT VIEW THAT, IF THE ASSESSEES CLAIM THAT THE NET PROFIT WAS BELOW THE PRESUMPTIVE INCOME AS PER S.44AD(1), HE COULD HAVE COMPLIED WITH THE PROV ISIONS OF S.44AD(6) OF THE ACT. IN THE ABSENCE OF ANY BOOKS OF ACCOUNT MA INTAINED AND ALSO NON- COMPLIANCE OF THE PROVISIONS OF S.44AD(6) OF THE AC T AND IN VIEW OF NET PROFIT WAS LESS THAN THE PRESUMPTIVE INCOME AS LAI D DOWN U/S 44AD(1) OF THE ACT, THE AO REJECTED THE NET PROFIT ARRIVED AT BY THE ASSESSEE REJECTED AND WENT AHEAD WITH IN ADOPTING THE NET PROFIT AT 8 % U/S 44AD (1) OF THE ACT ON THE ENTIRE GROSS RECEIPTS OF RS.23.93 LAKHS AND CONCLUDED THE ASSESSMENT ACCORDINGLY. 5. AGGRIEVED, THE ASSESSEE TOOK UP THE ISSUE WITH THE CIT(A) FOR RELIEF. HOWEVER, ON A PERUSAL OF THE IMPUGNED ORDE R OF THE CIT(A) WHICH IS UNDER DISPUTE, WE FIND THAT IN SPITE OF AFFORDING S EVERAL OPPORTUNITIES (MORE THAN NINE HEARINGS), PERHAPS, THE ASSESSEE HAD CHOS EN NOT TO RESPOND TO ITA NO.20/BANG/10 PAGE 3 OF 3 ANY OF SUCH HEARING NOTICES WHICH CULMINATED IN DIS MISSING HIS APPEAL IN LIMINE BY THE LD. CIT (A) WITHOUT GOING INTO THE MERITS O F THE CASE. IN THIS CIRCUMSTANCE WE ARE OF THE VIEW THAT THE CASE NEEDS TO BE REMITTED BACK ON THE FILES OF CIT(A) FOR A PROPER EXAMINATION OF THE FACTS AND LEGAL ISSUES INVOLVED ON MERITS AND TO TAKE APPROPRIATE ACTION I N ACCORDANCE WITH THE PROVISIONS OF THE ACT BY RECORDING A SPEAKING ORDER . IT IS ORDERED ACCORDINGLY. THE ASSESSEE IS ALSO DIRECTED TO CO-OPERATE IN THE PROCEEDINGS BEFORE THE CIT(A). 8. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. PRONOUNCED IN THE OPEN COURT ON THIS 23 RD DAY OF JULY, 2010. SD/- SD/- ( SMT. P. MADHAVI DEVI ) (A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 23 RD JULY, 2010. DS/- COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.