TMR Projects P.Ltd, New Delhi V. ACIT, Central circle-13, New Delhi

ITA 2344/DEL/2019

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 5505 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: G
• Assessment Year: 2014-2015
• Appeal Filed On: 17-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 153A; 13; 145(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘G’, NEW DELHI BEFORE SH. N. K. BILLAIYA, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER ITA No.2344/Del/2019 Assessment Year: 2014-15 TMR Projects P. Ltd. 16-D, Basant Lok Community Centre, New Delhi-110057 PAN No.AADCT7013J Vs ACIT Central Circle – 13 New Delhi (APPELLANT) (RESPONDENT) Appellant by Sh. V. K. Bindal, Advocate Ms. Rinki Sharma, Advocate Respondent by Sh. H. K. Chaudhary, CIT (DR) Date of hearing: 31/03/2022 Date of Pronouncement: 31/03/2022 ORDER PER N. K. BILLAIYA, AM: This appeal filed by the assessee is preferred against the order of the CIT(A)-26, New Delhi dated 14.01.2019 for A.Y.2014-15. 2. The substantive grievance of the assesee read as under :- 1. The learned CIT(A) erred in law and on facts in confirming the addition of Rs.15,47,030/- made on 2 estimated basis @1 % of the sale value ignoring the facts and submissions placed on record. Thus, the additions so made on estimated basis should be deleted. 2. The Learned CIT(A) erred in law and on facts in expense of Rs.6,72,389/- incurred for running the business of the assessee and duly recorded in the books of account a) ignoring the details of expenses placed on record and without pointing out any discrepancy in them. b) ignoring that no incriminating material was found to show that the said expenses were not incurred for business and c) without recording any finding in this regard in the appellate order. 3. At the very outset the counsel for the assessee stated that a similar quarrel was considered by this Tribunal in assesse’s own case in A.Y.2013-14 and 2015-16 in ITA Nos. 5771 and 5772/Del/2018. The DR fairly conceded to this. 4. We have carefully perused the orders of the authorities below and have also considered the order of this Tribunal in ITA Nos. 5771 and 5772 /Del/2018. The relevant findings of the coordinate Bench read as under :- “14. The fact shows that assessee filed it's return of income on.13.10.2015. The assessment u/s 153A pursuant to search dated 23.07.2015 was completed on 28.12.2017 wherein, total income of the assessee was computed @ 1% total sales of Rs, 1,87,17,200/- applying rate of earning ratio @1%. Consequently, total income was assessed at Rs. 1,87,180/-. 15. The assessee challenged it before the Id CIT(A) who in fact reduced the net profit to 0.5% instead of 1% determined by the assessee. Before the Id 3 CIT(A) the assessee submitted that even if it is considered that assessee is acting as a conduit and providing accommodation entry, that is the business of the assessee. Therefore, those expenses incurred by the assessee for carrying out such business are also allowable to the assessee as deduction. It was stated that the assessee has incurred total expenditure of Rs. 7,41,179/- which was shown in profit and loss account of the assessee, same should be allowed as deduction and only net loss of Rs. 6,22,256/- should be considered for the purpose of the taxation. 16. In respect of income of Rs. 1,87,180/- we find that the Id CIT(A) has Educed the margin of the assessee @0.5% instead of 1% for same reason that the assessee has apparently booked certain expenditure therefore, the Id CIT(A) has reduced the quantum to 1% to 0.5% . XXXXXX 19. We have carefully considered the rival contentions and perused the orders of the lower authorities. In fact on reading of the assessment order it is apparent that the income of the assessee was arrived at by rejecting books of accounts of assessee in terms of provision of section 145(3) of the act. He has determined profit of the assessee at 1% of the total bogus saies issued by the assessee. Such determination of the profit at the rate of 1% which was reduced by the learned CIT - A2 0.5% has resulted in deriving at the net profit of the assessee after deduction of ail the expenses incurred by the assessee. Therefore, there is no room for allowance of any expenditure to the assessee where net profit is determined. Even otherwise the Id CIT(A) has reduced the quantum of percentage from 1% to 0.5% for allowing the expenditure to the assessee. In view of the above facts we do not find any infirmity in the order of the lower authorities.” 5. Since in the immediately preceding year and the succeeding assessment year the profit margin has been accepted as 0.5% respectfully following the same we direct the AO to re-compute the addition by taking the margin of the assessee at 0.5%. 6. Since after accepting the margin at 0.5% the coordinate Bench has held that there is no room for allowance of any expenditure of the assessee. Respectfully following the same we hold accordingly. 4 7. In the result, the appeal filed by the assessee is partly allowed. 8. Decision announced in the open court in the presence of both the parties. Sd/- Sd/- (ASTHA CHANDRA) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER *NEHA* Date:-31.03.2022 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Date of dictation 31.03.2022 Date on which the typed draft is placed before the dictating Member 31.03.2022 Date on which the typed draft is placed before the Other member 31.03.2022 Date on which the approved draft comes to the Sr.PS/PS 31.03.2022 Date on which the fair order is placed before the Dictating Member for Pronouncement 31.03.2022 Date on which the fair order comes back to the Sr. PS/ PS 31.03.2022 Date on which the final order is uploaded on the website of ITAT 31.03.2022 Date on which the file goes to the Bench Clerk Date on which file goes to the Head Clerk. The date on which file goes to the Assistant Registrar for signature on the order Date of dispatch of the Order