M/s. Prashant Generator Co., Bahadurgarh V. ITO, Rohtak

ITA 2109/DEL/2012

• Counselvise Citation: 210920114 RSA 2012
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2009-2010
• Appeal Filed On: 04-05-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Assessee Lawyers: J P PASRIC HA
• Keywords: Rejection of books of accounts

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F: NEW DELHI BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER I.T.A.NO.2109/DEL/2012 ASSESSMENT YEAR : 2009-10 M/S. PRASHANT GENERATOR CO, INCOME-TAX OFFICER, 1401, SECTOR-06, BAHADURGARH. VS. WARD-3, ROHTAK. PAN: AQCPS6289B. I.T.A. NO.2135/DEL/2012 ASSESSMENT YEAR : 2009-10 INCOME-TAX OFFICER, SHRI PARSHANT SAINI, WARD-3, ROHTAK. VS. SHOP NO.47, 2 ND FLOOR, PACHIM VIHAR, DELHI. PAN : AQCPS6289B (APPELLANTS) (RESPONDENTS) ASSESSEE BY : SHRI J.P. PASRIC HA, CA. DEPARTMENT BY : SHRI SATPAL SINGH, SR. DR. DATE OF HEARING : 10.12.2012 DATE OF PRONOUNCEMENT : 1 0.12.2012 O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER THE ASSESSEE AS WELL AS THE REVENUE ARE AGGRIEVED B Y THE ORDER DATED 16 TH FEBRUARY, 2012, OF THE LEARNED FIRST APPELLATE AUT HORITY, ROHTAK, CONSEQUENTLY, ARE IN APPEAL BEFORE THIS TRIBUNAL FO R ASSESSMENT YEAR 2009- ITA NOS.2109 & 2135/DEL/2012 2 10. THE ASSESSEE HAS CHALLENGED THE APPLICATION OF 30% OF PROFIT OF THE RENTAL RECEIPTS WHEREAS THE REVENUE SUPPORTED THE A DOPTION OF 70% FROM GENERATOR SETS. 2. DURING HEARING OF THESE APPEALS WE HAVE HEARD SH RI I.P. PASRICHA, LEARNED COUNSEL OF THE ASSESSEE AND SHRI SATPAL SIN GH, LEARNED SR. DR. BOTH SIDES ARE AGGRIEVED FROM ADOPTION OF GROSS PROFIT R ATE. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS HIGH RATE OF ADOPTION I.E. 30% OF THE TOTAL RENTAL RECEIPTS WHEREAS THE REVENUE IS AGGRIE VED IN REDUCTION OF THE PROFIT FROM 70% ADOPTED BY THE LEARNED ASSESSING OF FICER. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON RECORD. SINCE THE ISSUE INVOLVED IN B OTH THE APPEALS IS IDENTICAL, THE APPEALS WERE HEARD TOGETHER, THEREFORE, THESE A RE BEING DISPOSED OF BY THIS COMMON ORDER, FOR THE SAKE OF CONVENIENCE. TH E FACTS IN BRIEF ARE THAT THE ASSESSEE SHRI PARSHANT SAINI IS THE PROPRIETOR OF M/S. PRASHANT GENERATOR COMPANY AND IS ENGAGED IN THE BUSINESS OF HIRING OF GENERATORS/GENERATOR PARTS TO INDIVIDUALS/OTHER COMPANIES. THE ASSESSEE IN THE IMPUGNED YEAR DECLARED GROSS TOTAL INCOME OF RS.7,92,228/- AND CL AIMED TDS THEREUPON. THE CASE OF THE ASSESSEE WAS TAKEN UP FOR SCRUTINY. FROM THE ASSESSMENT STAGE ITSELF THE ASSESSEE CLAIMED THAT THERE WAS A DISPUTE BETWEEN THE CHARTERED ACCOUNTANT AND THE ASSESSEE. TO CUT SHOR T THE MATTER THE AO ITA NOS.2109 & 2135/DEL/2012 3 MADE CERTAIN ADDITIONS/DISALLOWANCES TO THE EXTENT OF 70% OF THE RENTAL RECEIPTS IGNORING THE SUBMISSIONS OF THE ASSESSEE. ON APPEAL, THE LEARNED CIT(A) ADOPTED THE ESTIMATION OF PROFIT AT 30% OF S UCH GROSS RECEIPTS AND THUS PARTLY ALLOWED THE APPEAL. THE ASSESSEE AS WE LL AS THE REVENUE ARE AGGRIEVED FROM SUCH ADOPTION. BEFORE US THE LEARNE D COUNSEL FOR THE ASSESSEE ASSERTED THAT FOR EARLIER ASSESSMENT YEAR (2007-08) THE ASSESSMENT WAS FRAMED AT THE PROFIT OF 7% OF THE GROSS RECEIPT S. TO SUBSTANTIATE ITS CLAIM THE LEARNED COUNSEL PROVIDED THE COPY OF THE ASSESSMENT ORDER. WE FIND THAT VIDE ORDER DATED 24 TH DECEMBER, 2009 FOR A.Y. 2007-08 THE ASSESSING OFFICER ADOPTED THE NET PROFIT @ 7% OF TH E GROSS RECEIPTS OF RS.1,22,38,911/-. HOWEVER, THE BOOKS OF ACCOUNTS I N THE PRESENT ASSESSMENT YEAR WERE REJECTED BY THE ASSESSING OFFICER BEING N OT RELIABLE. BOTH SIDES BEFORE US FAIRLY AGREED THAT A REASONABLE PERCENTAG E OF PROFIT MAY BE ADOPTED. KEEPING IN VIEW THE PAST HISTORY, MATERIA L AVAILABLE ON RECORD, REJECTION OF BOOKS OF ACCOUNTS, WE HAVE NO OPTION B UT TO ESTIMATE THE NET PROFIT AS BOTH THE AUTHORITIES HAVE ALSO ADOPTED TH E NET PROFIT RATE. THEREFORE, WE ADOPT THE NET PROFIT @ 12% INCLUDING NET OF DEPR ECIATION TO WHICH BOTH PARTIES AGREED. WE ARE MAKING IT CLEAR THAT THIS ADOPTION IS APPLICABLE TO THE PECULIAR FACTS OF THE PRESENT ASSESSMENT YEAR O NLY. EVEN OTHERWISE, EACH ITA NOS.2109 & 2135/DEL/2012 4 YEAR IS INDEPENDENT. FINALLY, BOTH THE APPEALS ARE DISPOSED OF IN THE AFORESAID MANNER. 4. CONSEQUENTLY BOTH THE APPEALS ARE PARTLY ALLOWED . 5. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN T HE PRESENCE OF THE LEARNED REPRESENTATIVES FROM BOTH SIDES AT THE CONC LUSION OF THE HEARING ON 10 TH DECEMBER, 2012. SD/- SD/- ( B.C. MEENA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 10 TH DECEMBER, 2012. COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR, ITAT.