R.alavanthar, CHENNAI V. ITO, Pondicherry

ITA 2259/CHNY/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 77356 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 23-04-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 26-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A S SRIRAMAN
• Keywords: Additional evidence

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHE NNAI . . . , !' , # $! % BEFORE DR. O.K. NARAYANAN, VICE PRESIDENT & SHRI VIKAS AWASTHY, JUDICIAL MEMBER . / I.T.A. NO. 2259/MDS/2013 / ASSESSMENT YEAR : 2009-10 SHRI R.ALAVANTHAR, PROP. VENKATACHALAPATHY MODERN RICE MILL, 34/2, SORAPAET VILLAGE, MANNADIPET COMMUNE, PONDICHERRY [PAN: AEYPA 3980 M] ( '& /APPELLANT) VS THE INCOME TAX OFFICER, WARD 1(1), PONDICHERRY ( '('& /RESPONDENT) / APPELLANT BY : SHRI A.S. SRIRAMAN, ADVOCATE / RESPONDENT BY : SHRI SHAJI P. JACOB, ADDL.CIT / DATE OF HEARING : 23-04-2014 ! / DATE OF PRONOUNCEMENT : 16-06-2014 $) / O R D E R PER VIKAS AWASTHY, J.M: THE APPEAL HAS BEEN FILED BY THE ASSESSEE ASSAILIN G THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-VI , CHENNAI, DATED 29-11-2013 RELEVANT TO THE ASSESSMENT YEAR (A Y) 2009-10. 2. THE ASSESSEE IS PROPRIETOR OF RICE MILL. THE AS SESSEE FILED HIS RETURN OF INCOME FOR THE AY. 2009-10 ON 03-02-2 010 DECLARING I.T.A. NO. 2259/MDS/2013 2 TAXABLE INCOME OF ` 5,00,730/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND NOTICE U/S. 143(2) OF THE INCOME TAX ACT, 1961 (HEREIN AFTER REFERRED TO AS THE ACT) WAS IS SUED TO THE ASSESSEE ON 30-09-2010. DURING THE COURSE OF ASSES SMENT PROCEEDINGS, THE ASSESSING OFFICER OBSERVED THAT TH E ASSESSEE HAS SHOWN TOTAL TURNOVER OF THE BUSINESS AS ` 5,35,37,889/-. THE ASSESSEE WAS ASKED TO PRODUCE BOOKS OF ACCOUNTS, BA NK DETAILS VOUCHERS ETC., IN SUPPORT OF HIS CLAIM TOWARDS EXPE NDITURE. DESPITE REPEATED NOTICES, THE ASSESSEE FAILED TO PR ODUCE THE BOOKS OF ACCOUNTS AND OTHER RELATED DOCUMENTS/DETAI LS AS SOUGHT BY THE ASSESSING OFFICER. THE ASSESSING OFFICER WA S CONSTRAINED TO MAKE BEST JUDGMENT ASSESSMENT U/S.144 OF THE ACT . THE ASSESSING OFFICER ESTIMATED THE INCOME OF THE ASSE SSEE AS 5% OF THE TOTAL TURNOVER. AGGRIEVED AGAINST THE ASSESSMENT ORDER DATED 29-12 -2011 PASSED U/S.144 OF THE ACT, THE ASSESSEE PREFERRED A N APPEAL BEFORE THE CIT(APPEALS). THE CIT(APPEALS) UPHELD T HE FINDINGS OF THE ASSESSING OFFICER AND CONFIRMED THE ESTIMATION MADE BY THE ASSESSING OFFICER AT 5% OF THE TURNOVER. AGGRIEVED AGAINST THE ORDER OF THE FIRST APPELLATE AUTHORITY, THE ASSESSEE HAS COME IN SECOND APPEAL BEFORE THE T RIBUNAL. I.T.A. NO. 2259/MDS/2013 3 3. SHRI A.S.SRIRAMAN, ADVOCATE APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE AUTHORITIES BELOW HAVE ERRED IN ESTIMATING THE INCOME OF THE ASSESSEE AT 5% OF THE TOTAL TURNOVER WITHOUT ASSIGNING ANY VALID REASON. THE BOOKS OF A CCOUNTS OF THE ASSESSEE WERE SEIZED BY THE CIVIL SUPPLIES DEPARTME NT, THEREFORE, THE ASSESSEE COULD NOT PRODUCE THE SAME BEFORE THE ASSESSING OFFICER. THE ASSESSEE HAD PRODUCED COMPA RATIVE STATEMENTS OF OTHER ASSESSEES IN THE SAME LINE OF B USINESS BUT THE CIT(APPEALS) DECLINED TO TAKE NOTE OF THE SAME. TH E LD.COUNSEL PRAYED FOR SETTING ASIDE OF THE IMPUGNED ORDER. 4. ON THE OTHER HAND, SHRI SHAJI P. JACOB, APPEARIN G ON BEHALF OF THE REVENUE VEHEMENTLY SUPPORTED THE IMPUGNED OR DER AND SUBMITTED THAT DESPITE SEVERAL OPPORTUNITIES THE AS SESSEE FAILED TO PRODUCE BOOKS OF ACCOUNTS AND OTHER RELEVANT DOCUME NTS/DETAILS BEFORE THE ASSESSING OFFICER OR EVEN BEFORE THE FIR ST APPELLATE AUTHORITY. NO REASON WHAT-SO-EVER WAS GIVEN AS TO WHY THE BOOKS WERE SEIZED BY THE CIVIL SUPPLIES DEPARTMENT. THE ASSESSEE NEVER MADE ANY FORMAL APPLICATION BEFORE CIT(APPEAL S) FOR PLACING ON RECORD ADDITIONAL EVIDENCE IN THE FORM OF COMPAR ATIVE FIGURES OF PROFIT AND LOSS WITH THE OTHER PLAYERS IN THE TRADE . THE LD.DR PRAYED FOR THE DISMISSAL OF THE APPEAL OF THE ASSES SEE. I.T.A. NO. 2259/MDS/2013 4 5. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTATIVES OF BOTH THE SIDES AND HAVE ALSO PER USED THE ORDERS OF THE AUTHORITIES BELOW. IT IS AN UNDISPUTED FACT THAT THE ASSESSEE HAS NOT BROUGHT ON RECORD THE BOOKS OF ACCOUNTS, BA NK STATEMENT, BILLS AND VOUCHERS ETC., TO SUPPORT THE FIGURES STA TED IN THE RETURN OF INCOME. IN THE ABSENCE OF RELEVANT RECORD, THE ASS ESSING OFFICER WAS CONSTRAINED TO MAKE BEST JUDGMENT ASSESSMENT U/ S.144 OF THE ACT, WHEREBY, HE ESTIMATED THE INCOME OF THE ASSESS EE AS 5% OF THE TOTAL TURNOVER. THE TOTAL TURNOVER AS ADMITTED BY THE ASSESSEE IS MORE THAN ` 5.35 CRORES. IN HIS RETURN OF INCOME, THE ASSESSEE HAD ADMITTED TAXABLE INCOME AS ` 5.00 LAKHS ONLY. THE CONTENTION OF THE ASSESSEE IS THAT NO BASIS OF ESTIMATION HAS BEEN GIVEN AND THE COMPARATIVE FIGURES OF PROFIT AND LOSS SUBMITTE D BY THE ASSESSEE BEFORE THE CIT(APPEALS) WERE NOT CONSIDERE D. WE FIND THAT THE ASSESSEE HAD NOT BROUGHT ON RECORD COMPARA TIVE ANALYSIS OF PROFIT AND LOSS OF THE ASSESSEE WITH OTHER PERSO NS IN THE SAME LINE OF BUSINESS, AS WELL AS THE PROFIT AND LOSS OF THE ASSESSEE IN THE EARLIER AYS. IN THE INTEREST OF JUSTICE, WE REMIT THE FILE BACK TO THE ASSESSING OFFICER WITH A DIRECTION TO THE ASSESSEE TO PLACE ON RECORD THE BOOKS OF ACCOUNTS, BANK STATEMENT, BILLS , VOUCHERS ETC., FOR THE RELEVANT AY BEFORE ASSESSING OFFICER. IN C ASE THE I.T.A. NO. 2259/MDS/2013 5 ASSESSEE IS UNABLE TO PRODUCE THE SAME, HE SHALL GI VE REASONS IN WRITING FOR NOT PRODUCING THE AFORESAID DOCUMENTS A ND DETAILS TO THE ASSESSING OFFICER. IN THE ABSENCE OF SUCH RECO RDS, THE ASSESSEE SHALL PROVIDE THE ASSESSING OFFICER WITH C OMPARABLES WITHIN THE INDUSTRY/TRADE, AS WELL AS HIS OWN FINAN CIAL RECORDS FOR THE IMMEDIATE PAST FIVE YEARS. THE ASSESSING OFFIC ER AFTER ANALYZING THE SAME SHALL MAKE ESTIMATION AND PASS O RDER IN ACCORDANCE WITH LAW. THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON MONDAY, THE 16 TH JUNE, 2014 AT CHENNAI. SD/- SD/- ( . . . ) ( !' ) (DR. O.K. NARAYANAN) (VIKAS AWAS THY) '#$ / VICE PRESIDENT % &' / JUDICIAL MEMBER (% /CHENNAI, )& /DATED: 16 TH JUNE, 2014 TNMM &* +,-, /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. ./0 /CIT(A) 4. . /CIT 5. ,12 3 /DR 6. 245 /GF