VINOD KUMAR GUPTA, JHUNJHUNU V. ITO, JHUNJHUNU

ITA 282/JPR/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5501 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 10 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 11-04-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJENDER SINGH J DHK

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JUDICIAL MEMBER VK;DJ VIHY LA-@ ITA NO. 282/JP/2014 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2009-10 SHRI VINOD KUMAR GUPTA SURAJGARH MANDI, WARD NO.4 SURAJGARH, JHUNJHUNU CUKE VS. THE ITO WARD-2 JHUNJHUNU LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: ABDPG 1123 E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI HIMANSHU GOYAL, CA JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJENDER SINGH, JCIT-DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 17/12/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 15 /02/2016 VKNS'K@ ORDER PER R.P. TOLANI, JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE LD. CIT(A)-III, JAIPUR DATED 24-01-2014 FOR THE ASSESS MENT YEAR 2009-10 THE CONCISE GROUNDS RAISED ARE AS UNDER. (I) THE LD. CIT(A) HAS ERRED IN SUSTAINING AN ADDIT ION OF RS. 3,44,858/- BY ADOPTING GROSS PROFIT RATE AT 3.3 8% AS AGAINST 2.72% SHOWN BY THE ASSESSEE. ITA NO. 282/JP/2014 SHRI VINOD KUMAR GUPTA VS. ITO WARD- 2), JHUNJHUNU . 2 (II) THE LD. CIT(A) HAS ERRED IN SUSTAINING AN ADDI TION OF RS. 23,349/-ON ACCOUNT OF DISALLOWED MADE BY THE A O OF SHOP EXPENSES AND WAGES (III) THE LD. CIT(A) HAS ERRED IN SUSTAINING AN ADD ITION OF RS. 11,350/- ON ACCOUNT OF DISALLOWANCE MADE BY TH E OF SALARY EXPENSES. (IV) THE LD. CIT(A) HAS ERRED IN SUSTAINING AN ADDI TION OF RS. 8,947/- ON ACCOUNT OF DISALLOWANCE MADE BY THE AO OF TRAVELING AND TELEPHONE EXPENSES. 2.1 DURING THE COURSE OF HEARING, LD. AR OF THE AS SESSEE CONTENDS THAT NO WORTHWHILE DEFECTS HAVE BEEN POINTED OUT BY THE AO WHILE ESTIMATING GROSS PROFIT RATE. HE FURTHER CONTENDS THAT THOUGH THE ASSESSEE HAS NOT CHALLENGED THE REJECTION OF BOOKS OF ACCOUNT YET ES TIMATION OF GROSS PROFIT IS NOT WARRANTED ONLY BECAUSE THE ASSESSEE HAS NOT MAINTAINED QUALITATIVE AND QUANTITATIVE STOCK REGISTER. THEREFORE, THE GRO SS PROFIT DECLARED BY THE ASSESSEE SHOULD BE UPHELD AND NO ADDITION SHOULD BE MADE. 2.2 APROPOS REMAINING ADDITIONS, IT IS CONTENDED TH AT ONCE THE BOOKS OF ACCOUNT ARE REJECTED THEN NO SEPARATE ADDITION CAN BE MADE BESIDES THE DISALLOWANCES ARE ON UNTENABLE GROUNDS. ITA NO. 282/JP/2014 SHRI VINOD KUMAR GUPTA VS. ITO WARD- 2), JHUNJHUNU . 3 2.3 THE LD. DR ON THE OTHER HAND CONTENDS THAT THE ASSESSEE HAS NOT MAINTAINED ANY BOOKS OF ACCOUNT AT ALL WHICH IS NOT DISPUTED BY THE ASSESSEE. HE FURTHER CONTENDS THAT THE AO HAS RIGHT LY OBSERVED THAT IN THE ABSENCE OF STOCK REGISTER IT IS NOT POSSIBLE TO VER IFY THE TRADING RESULTS. THEREFORE, THE PROFIT RATE HAS BEEN ESTIMATED BY A DOPTING AVERAGE GROSS PROFIT RATE OF PAST THREE YEARS. THIS IS A SCIENTIF IC METHOD OF ESTIMATION OF PROFIT. THE LD. DR RELIED ON THE ORDERS OF THE LD. CIT(A). 2.4 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. SINCE THE ASSESSEE HAS NOT DIS PUTED THE FACT THAT STOCK REGISTER IS NOT MAINTAINED, THEREFORE, THE REJECTIO N OF BOOKS OF ACCOUNT AND ESTIMATION OF GROSS PROFIT IS IN ORDER. THE ASSESSE E HAS NOT CHALLENGED THE GROUND ABOUT THE REJECTION OF BOOKS OF ACCOUNT. THE ADOPTION OF GROSS PROFIT RATE OF PAST THREE YEARS IS ACCEPTABLE AND R EASONABLE METHOD OF ESTIMATION. IN VIEW THEREOF, THE TRADING ADDITION R ETAINED BY THE LD. CIT(A) IS UPHELD. THUS GROUND NO. 1 OF THE ASSESSE E IS DISMISSED. 2.5 APROPOS REMAINING ADDITIONS, ONCE THE ASSESSEE' S BOOKS OF ACCOUNT IS REJECTED AND ESTIMATION OF GROSS PROFIT RATE IS APPLIED THEN THERE IS NO ITA NO. 282/JP/2014 SHRI VINOD KUMAR GUPTA VS. ITO WARD- 2), JHUNJHUNU . 4 JUSTIFICATION IN MAKING ANY FURTHER ADDITION. THERE FORE, OTHER ADDITIONS ARE DELETED. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15/02/2016 . SD/- VKJ-IH-RKSYKUH (R.P.TOLANI) U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 15/02 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI VINOD KUMAR GUPTA, JHUNJHUNU 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD-2, JHUNJHUNU 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 282JP/2014) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR