M/S NEW ERA TRAVEL & CARGO AGENCIES, CHENNAI V. ACIT NON CORPORATE CIRCLE 3, CHENNAI

ITA 2555/CHNY/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 7194 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 2 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 24-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: D ANAND
• Keywords: Set aside; FORM 26AS

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , C B ENCH, CHENNAI . . , . , $ BEFORE SHRI JUSTICE P.P.BHATT, PRESIDENT AND SHRI G.MANJUNATHA, ACCOUNTANT MEMBER I.T.A.NO.2555/CHNY/2017 ( / ASSESSMENT YEAR: 2014-15) M/S. NEW ERA TRAVEL & CARGO AGENCIES, 627, MOUNT ROAD, CHENNAI-600 006. VS THE ASSISTANT COMMISSIONER OF INCOME TAX, NON-CORPORATE CIRCLE-3, CHENNAI. PAN: AAAFN2423Q ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. D.ANAND, ADVOCATE /RESPONDENT BY : MR. ABANI KANTA NAYAK, CIT /DATE OF VIRTUAL HEARING : 09.12.2020 /DATE OF PRONOUNCEMENT : 20.01.2021 / O R D E R PER G.MANJUNATHA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -4, CHENNAI DATED 30.08.2017 AND PERTAINS TO ASSESSMENT YEAR 20 14-15. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THE ORDER PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 4 IS AGAINST THE FACTS OF TH E CASE AND PRINCIPLES OF NATURE JUSTICE. 2. THE CONTENTION OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS NOT TOTALLY CORRECT. 3. THERE WERE TOTAL TWO APPEALS FOR TWO DIFFERENT ASSESSMENT YEARS. 2 ITA NO.2555/CHNY/2017 4. THE APPELLANT HAD APPEARED FOR THE HEARING, BUT DETAILS FOR OTHER YEAR UNDER APPEAL WAS ONLY CALLED FOR. 5, THE APPELLANT WAS OF THE IMPRESSION THAT ONLY ON E YEAR WAS TAKEN AT A TIME AND HENCE DID NOT PROVIDE ANY WRITTEN SUBMISSIONS FOR THE RELEVANT YEAR UNDER APPEAL. 6. THIS WAS UNINTENTIONAL AND PURELY COINCIDENTAL. 7. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FAILED TO APPRECIATE THE FACT THAT AN AGE NT IS RAVEL INDUSTRY CAN NEVER MAKE A NET PROFIT OF 5% OF HIS TURNOVER, 8. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ORDER WITHOUT APPLICATION OF MIND. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PARTNERSHIP FIRM, FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2014-15 ON 30.11.2014 DECLARING TOTAL INCOME OF ` 23,75,250/-. THE CASE WAS SELECTED FOR SCRUTINY AND DURING THE COURSE OF ASSE SSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE RE IS MISMATCH BETWEEN TURNOVER REPORTED IN RETURN OF INCOME FILED FOR THE RELEVANT ASSESSMENT YEAR AND GROSS RECEIPTS AS PER FORM 26AS , THEREFORE, CALLED UPON THE ASSESSEE TO FURNISH NECESSARY EVIDE NCES INCLUDING RECONCILIATION BETWEEN THE TURNOVER REPORTED IN BOO KS OF ACCOUNT AND TURNOVER AS PER FORM 26AS. IN RESPONSE, THE ASSESSE E SUBMITTED 3 ITA NO.2555/CHNY/2017 THAT TURNOVER REPORTED AS PER FORM 26AS, INCLUDES AMOUNT PAID BY CUSTOMERS TOWARDS REIMBURSEMENT OF EXPENSES, WHEREA S TURNOVER REPORTED IN FINANCIAL STATEMENTS IS EXCLUDING REIMB URSEMENT OF EXPENSES AND HENCE THERE IS A DIFFERENCE IN TURNOVE R AS PER BOOKS OF ACCOUNT AND RECEIPTS AS PER AS PER FORM 26AS. T HE ASSESSING OFFICER, IN ORDER TO VERIFY CLAIM OF THE ASSESSEE CALLED UPON THE ASSESSEE TO PRODUCE BOOKS OF ACCOUNT, BUT THE ASSES SEE FAILED TO PRODUCE BOOKS OF ACCOUNT INCLUDING DETAILS OF REIMB URSEMENT OF EXPENSES. THEREFORE, THE ASSESSING OFFICER PROCEEDE D TO PASS EX- PARTE BEST JUDGMENT ASSESSMENT U/S.144 R.W.S. 145(3 ) AND ESTIMATED NET PROFIT OF 5% ON TOTAL RECEIPTS AS PER FORM 26AS AND MADE ADDITION OF ` 21,27,182/-. 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASS ESSEE PREFERRED AN APPEAL BEFORE THE LEARNED CIT(A) . BEF ORE THE LEARNED CIT(A), THE ASSESSEE NEITHER APPEARED NOR FILED AN Y DETAILS DESPITE VARIOUS OPPORTUNITY OF HEARING WAS PROVIDED. THEREF ORE, THE LEARNED CIT(A) LEFT WITH NO OPTION DISPOSED OFF THE APPEAL FILED BY THE ASSESSEE EX-PARTE AND CONFIRMED THE ADDITIONS MADE BY THE ASSESSING OFFICER TOWARDS ESTIMATION OF PROFIT ON T URNOVER REPORTED 4 ITA NO.2555/CHNY/2017 AS PER FORM 26AS. AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US. 5. THE LEARNED AR FOR THE ASSESSEE SUBMITTED THAT T HE ASSESSEE COULD NOT APPEAR BEFORE THE LOWER AUTHORITIES TO EX PLAIN DIFFERENCE BETWEEN TURNOVER REPORTED IN BOOKS OF ACCOUNT AND G ROSS RECEIPTS AS PER FORM 26AS AND HENCE, APPEAL MAY BE SET ASIDE TO THE ASSESSING OFFICER TO GIVE ONE MORE OPPORTUNITY OF H EARING TO THE ASSESSEE TO EXPLAIN DIFFERENCE IN TURNOVER WITH NEC ESSARY RECONCILIATION. 6. THE LEARNED DR ON THE OTHER HAND, SUBMITTED THAT ASSESSEE HAS FAILED TO FILE NECESSARY RECONCILIATION EXPLAIN ING THE REASONS FOR DIFFERENCE IN TURNOVER AS PER BOOKS OF ACCOUNT AND GROSS RECEIPTS AS PER FORM 26AS AND HENCE, THERE IS NO NEED TO GIVE ANOTHER OPPORTUNITY TO THE ASSESSEE TO GO BEFORE THE ASSESS ING OFFICER . 7. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIE S BELOW. IT IS AN ADMITTED FACT THAT ASSESSING OFFICER HAS PASSED AS SESSMENT ORDER IN THE ABSENCE OF BOOKS OF ACCOUNT AND ESTIMATED P ROFIT ON THE 5 ITA NO.2555/CHNY/2017 BASIS OF TURNOVER REPORTED IN FORM 26AS. EVEN BEF ORE THE LEARNED CIT(A), THE ASSESSEE COULD NOT APPEAR AND FILE N ECESSARY DETAILS TO EXPLAIN THE DIFFERENCE BETWEEN TURNOVER REPORTED IN BOOKS OF ACCOUNT AND IN FORM 26AS. NO DOUBT, IT IS THE OBLIG ATION OF THE ASSESSEE TO APPEAR BEFORE THE AUTHORITIES AND EXPLA IN ITS CAW WITH NECESSARY EVIDENCE. IN CASE, THE ASSESSEE FAILS TO APPEAR AND FILE NECESSARY DETAILS, THEN THE AUTHORITIES LEFT WITH N O OPTION HAS TO COMPLETE THE ASSESSMENT ON THE BASIS OF THE MATERIA LS AVAILABLE ON RECORD. IN THIS CASE, THE ASSESSEE HAS FILED EXPLAN ATION BEFORE THE ASSESSING OFFICER REGARDING DIFFERENCE IN TURNOVE R REPORTED IN BOOKS OF ACCOUNT AND TURNOVER AS PER FORM 26AS, B UT COULD NOT PRODUCE BOOKS OF ACCOUNT TO JUSTIFY ITS CLAIM. IT IS NOT THE CASE OF THE ASSESSING OFFICER THAT ASSESSEE HAS NOT FILE D EXPLANATION TO EXPLAIN DIFFERENCE IN TURNOVER REPORTED IN BOOKS OF ACCOUNT AND FORM 26AS . THE ONLY REASON FOR REJECTION OF EXPLAN ATION FURNISHED BY THE ASSESSEE IS NON-FURNISHING OF BOOKS OF ACCOU NT. MOREOVER, THE LEARNED AR FOR THE ASSESSEE PLEADED BEFORE US THAT ASSESSEE IS READY TO FILE NECESSARY DETAILS TO EXPLAIN DIFFER ENCE BETWEEN TURNOVER REPORTED IN BOOKS OF ACCOUNT AND FORM 2 6AS. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT IN ORDER TO GI VE ONE MORE 6 ITA NO.2555/CHNY/2017 OPPORTUNITY OF HEARING TO THE ASSESSEE, THE APPEAL IS SET ASIDE TO THE FILE OF THE ASSESSING OFFICER AND DIRECT HI M TO REDO THE ASSESSMENT, AFTER CONSIDERING NECESSARY EVIDENCE F ILED BY THE ASSESSEE INCLUDING RECONCILIATION EXPLAINING THE DIFFERENCE BETWEEN TURNOVER REPORTED IN BOOKS OF ACCOUNT AND FORM 26AS . NEEDLESS TO SAY, THE ASSESSEE SHALL APPEAR BEFORE THE ASSESS ING OFFICER WITHOUT SEEKING ANY ADJOURNMENT AND FILE NECESSARY DETAILS FOR SPEEDY COMPLETION OF ASSESSMENT PROCEEDINGS. 8. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH JANUARY, 2021 SD/- SD/- ( . . ) ( . ) (JUSTICE P.P.BHATT ) (G. MANJUNATHA) / PRESIDENT ' / ACCOUNTANT MEMBER $ /CHENNAI, % /DATED 20 TH JANUARY, 2021 DS )* +* /COPY TO: 1. APPELLANT 2. RESPONDENT 3. , ( ) /CIT(A) 4. , /CIT 5. * 1 /DR 6. /GF .