M/s Mohan Diary, Bulandshahr V. ITO, Bulandshahr

ITA 2041/DEL/2010

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 6526 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 10 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 08-03-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 04-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R C D AN UN JAY
• Keywords: Bonafide belief; Condonation of delay
• Section: 44AD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F , NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SH. LALIT KUMAR , JUDICIAL MEMBER ITA NO. 2041 / DEL/20 1 0 AY: 20 05 - 06 MOHAN DIARY VS. ITO, WARD 2 SYANA ROAD BULANDHSAHR BULANDSHAHR 203 001 PAN: AAIFM 5414 C (APPELLANT) (RESPONDENT) APPELLANT BY : SH. R.C.DANUNJAY, SR. D.R. RESPONDENT BY : SH. RK GUPTA, C.A. ORDER PER J. SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD.CIT(A), MEERUT DT. 25.6.2009 PERTAINING TO THE A.Y. 2005 - 06. THERE IS A DELAY OF 253 DAYS IN FILING THE APPEAL. 2. AFTER PERUSING THE APPLICATION FILED BY THE ASSESSEE FOR CONDONATION OF DELAY AS WELL AS THE AFFIDAVIT, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM FI LING THIS APPEAL WITHIN THE TIME. BEFORE THE LD.CIT(A) THE ASSESSEE HAS TAKEN A GROUND NOW AGAINST THE ADDITION MADE BY ESTIMATING THE NET PROFIT AT 1% OF THE TURNOVER. THE LD.CIT(A) HAS AT PAGE 21 PARA 37 STATED THAT HE IS ALLOWING GROUND NO.4 OF THE A SSESSEE. AT THE SAME TIME HE HAS WRITTEN WITHIN BRACKETS THAT THE APPLICATION OF NET PROFIT @ 1% IS CONFIRMED. GROUND NO.4 OF THE ASSESSEE S APPEAL WAS SPECIFICALLY DIRECTED AGAINST THE ADDITION MADE O F NET PROFIT @ 1% ON SALES. HENCE THE CLAIM OF THE A SSESSEE THAT HE WAS UNDER A GENUINE AND BONAFIDE BELIEF THAT THIS ADDITION WAS DELETED BY THE LD.CIT(A) AND HENCE THERE WAS NO REQUIREMENT OF FILING OF THE APPEAL IS A REASONABLE EXPLANATION ITA NO. 2 0 41 /DEL/20 10 A.Y. 2 005 - 06 M/S MOHAN DAIRY, BULANDSHAHR (UP) 2 AND SATISFACTORY. WHEN THE REVENUE HAS FILED AN APPEAL, AND THE ASSESSEE RECEIVED THE APPEAL PAPERS AND WHEN IT HAD TAKEN THE APPEAL PAPERS TO ITS COUNSEL, WHO, ON GOING THROUGH THE APPELLATE ORDER ADVISED THE ASSESSEE TO FILE THIS APPEAL. THE ASSESSEE HAS FILED ITS APPEAL WITHIN 21 DAYS OF RECEIVING THE APPEAL MEM O IN THE REVENUE S APPEAL. HENCE THE EXPLANATION GIVEN BY THE ASSESSEE FOR THE DELAY IS REASONABLE. IN T HE RESULT THE DELAY IS CONDONED AND THE APPEAL IS ADMITTED. 3. COMING TO THE ADDITION OF 1% ON SALES AS NET PROFIT, WE FIND THAT THE ASSESSING OFFICE R HAS RELIED ON THE ASSESSEE S OWN CASE FOR THE A.Y. 1998 - 99. THE AO HELD THAT THE ITAT HAS SUSTAINED SUCH AN ADDITION. BEFORE US THE ASSESSEE FILED A COPY OF THE ORDER OF THE F BENCH OF ITAT IN THE ASSESSEE S OWN CASE IN ITA NO.4979/DEL/2004 AND ITA 493 4/DEL/04 ORDER DT. 30.10.2015 FOR A.Y. 1998 - 99 . A PERUSAL OF THE SAME SHOWS THAT THE ENTIRE ASSESSMENT ORDER WAS QUASHED ON THE GROUND OF JURISDICTION I.E. NON SERVICE OF NOTICE U/S 143(2) OF THE INCOME TAX ACT, 1961 (THE ACT). THUS THIS FACTUAL FINDING OF THE AO THAT THE TRIBUNAL HAS SUSTAINED THE ORDER OF THE A.O. FOR THE A.Y. 1998 - 99 IS INCORRECT . THE LD.CIT(A) HAS RECORDED AT PAGE 21 OF HIS RODER THAT THE A.O. IS JUSTIFIED IN HIS ACTION IN THE LIGHT OF THE DECISION IN ITA 1865/DEL/2002 IN THE CASE O F RAJ KAMAL MILK P.LTD. , BULANDSHAHR. A COPY OF SUCH ORDER IS NOT PLACED BEFORE US. THE A.O. DID NOT RELY ON ANY SUCH ORDER. HENCE THIS DECISION CANNOT BE CONSIDERED. IN ANY EVENT, THIS APPEAL IS FOR THE A.Y. 2005 - 06 AND THE FACTS OF A DIFFERENT ASSES SEE AND THAT TOO OF A YEAR WHICH IS MORE THAN 7 YEARS A PART , C ANNOT BE APPLIED UNLESS A FACTUAL SIMILARITY IS ESTABLISHED. THE LD.D.R. SUBMITTED THAT, THE ALTERNATIVE CONTENTION OF THE ASSESSEE WAS ACCEPTED BY THE LD.CIT(A) AND HENCE HE SHOULD NOT HAVE A NY GRIEVANCE. WE DO NOT AGREE WITH THIS SUBMISSION FOR THE REASON THAT, THE MAIN CONTENTION OF THE ASSESSEE HAS MERITS. THE BOOKS OF ACCOUNTS OF THE ASSESSEE HAVE BEEN VERIFIED BY THE A.O. DURING THE REMAND PROCEEDINGS AND NO INFIRMITIES WERE FOUND IN TH E SAME. THESE BOOKS ARE AUDITED U/S 44AD OF THE ACT. THE NET PROFIT OF THE ASSESSEE FOR THE EARLIER TWO A.YS IS 0.04% AND 0.07% RESPECTIVELY. UNDER THESE ITA NO. 2 0 41 /DEL/20 10 A.Y. 2 005 - 06 M/S MOHAN DAIRY, BULANDSHAHR (UP) 3 CIRCUMSTANCES THE NET PROFIT OF 0.05% AS DECLARED BY THE ASSESSEE CANNOT BE DISTURBED BY DETERMINI NG NET PROFIT @ 1% ON SALES. 4. FOR THESE REASONS WE DELETE THE ADDITION AND ALLOW THE APPEAL OF THE ASSESSEE. 5 . IN THE RESULT APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 08 TH MARCH, 2016 . SD/ - SD/ - ( LALIT KUMAR ) (J. SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: THE 08 TH MARCH, 2016 M ANGA COPY FORWARDED TO: - 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR, ITAT - TRUE COPY - BY ORDER, ASSISTANT REGISTRAR