Mani Ram Verma, Faizabad V. Asstt.Commissioner of Income Tax, Faizabad

ITA 286/LKW/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1649 (ITAT-LUCKNOW)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 04-02-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 18-05-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RANU BISWAS
• Assessee Lawyers: M P MISHRA
• Keywords: Depreciation
• Section: 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B , LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER AND SHRI J SUDHAKAR REDDY , ACCOUNTANT MEMBER ITA NO. 286/LKW/2012 ASSESSMENT YEAR: 2006 - 07 MANI RAM VERMA S/O SHRI. RAJ KISHORE VERMA KAT RA, GOSAIGANJ, FAIZABAD V. ACIT CIRCLE, FAIZABAD PAN: ABCPV1619E (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI. M. P. MISHRA, ADVOCATE RESPONDENT BY: SMT. RANU BISWAS, D.R. DATE OF HEARING: 12.03.13 DATE OF PRONOUNCEMENT: 15.03.13 O R D E R PE R S UNIL KUMAR YADAV : THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) ON A SOLITARY GROUND THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ASSESSMENT ON THE GROUND THAT THE ASSESSEES CASE IS NOT QUITE SIMILAR TO THE CASE OF S HRI. TILAK RAM VERMA (REAL BROTHER) AND UPHOLDING THE NET PROFIT RATE OF 8% AS AGAINST ASSESSEES DISCLOSED NET PROFIT RATE OF 5.17%, WHEREAS IN THE CASE OF SHRI. TILAK RAM VERMA, THE CIT, FAIZABAD HAS ALLOWED RELIEF UNDER SECTION 264 OF THE INCOME - TAX ACT , 1961 (HEREINAFTER CALLED IN SHORT THE ACT') AND SUSTAINED THE NET PROFIT RATE OF 1.4%. 2 . THE FACTS IN BRIEF ARE THAT THE ASSESSING OFFICER ESTIMATED THE NET PROFIT RATE IN RESPECT OF THE BRICK KILN BUSINESS OF THE ASSESSEE @ 10% OF THE TOTAL TURNOVER AFTE R REJECTING THE BOOKS OF ACCOUNT. THE ASSESSEE : - 2 - : PREFERRED AN APPEAL BEFORE THE LD. CIT(A) AND THE LD. CIT(A) HAS ESTIMATED THE NET PROFIT RATE AT 8%. THE ASSESSEE FURTHER CARRIED THE MATTER BEFORE THE TRIBUNAL WHICH SET ASIDE THE MATTER AND RESTORED TO TH E FILE OF THE ASSESSING OFFICER FOR FRESH EXAMINATION IN THE LIGHT OF THE DECISION TAKEN BY THE CIT, FAIZABAD UNDER SECTION 264 OF THE ACT IN THE CASE OF SHRI. TILAK RAM VERMA. CONSEQUENT THERETO THE ASSESSING OFFICER PASSED THE IMPUGNED ASSESSMENT AND AD OPTED THE NET PROFIT RATE AT 8%. DEPRECIATION CLAIMED BY THE ASSESSEE WAS ALSO DISALLOWED BY THE ASSESSING OFFICER. AGAIN AN APPEAL WAS PREFERRED BEFORE THE LD. CIT(A), BUT THE ASSESSEE DID NOT FIND FAVOUR WITH HIM. NOW THE ASSESSEE IS BEFORE US. 3 . DURIN G THE COURSE OF HEARING OF THE APPEAL, OUR ATTENTION WAS INVITED TO THE ORDER OF THE TRIBUNAL DATED 21.1.2009 IN ITA NO. 870/LUC/2008, IN WHICH THE TRIBUNAL HAS GIVEN A SPECIFIC DIRECTION WHILE RESTORING THE MATTER TO THE FILE OF THE ASSESSING OFFICER THAT FRESH ASSESSMENT BE MADE IN THE LIGHT OF THE DECISION TAKEN BY THE CIT, FAIZABAD UNDER SECTION 264 OF THE ACT IN THE CASE OF SHRI. TILAK RAM VERMA AFTER COMPILING THE FACTS IN THE PRESENT CASE WITH THE CASE OF SHRI. TILAK RAM VERMA AND I F THE FACTS IN THE CASE OF SHRI. TILAK RAM VERMA ARE SIMILAR TO THE FACTS OF THE CASE OF THE ASSESSEE, THEN THERE SHOULD NOT BE ANY REASON NOT TO ACCEPT THE RESULTS SHOWN BY THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER CONTENDED THAT THE FACTS OF THE ASSESSEE S CASE ARE QUITE SIMILAR TO THE FACTS OF THE CASE OF SHRI. TILAK RAM VERMA, BUT THE ASSESSING OFFICER HAS NOT ACCEPTED THE RESULTS SHOWN BY THE ASSESSEE WHICH IN FACT ARE HIGHER THAN THE NET PROFIT RATE ESTIMATED IN THE CASE OF SHRI. TILAK RAM VERMA. 4 . THE LD. D.R., ON THE OTHER HAND, HAS DISPUTED THE CONTENTIONS OF THE LD. COUNSEL FOR THE ASSESSEE WITH THE SUBMISSION THAT THE FACTS OF BOTH THE CASES ARE NOT SIMILAR AS IN THE CASE OF SHRI. TILAK RAM VERMA THE BOOK RESULTS WERE NOT REJECTED AND THE TURNOVER I N THAT CASE WAS HIGHER THAN THE TURNOVER OF THE ASSESSEE. THEREFORE, THE ASSESSING OFFICER HAS RIGHTLY : - 3 - : EXAMINED THE FACTS OF THE CASE INDEPENDENTLY AND ESTIMATE D THE NET PROFIT RATE. 5 . WE HAVE CAREFULLY EXAMINED THE FACTS OF BOTH THE CASES IN THE LIGHT OF R IVAL SUBMISSIONS AND WE FIND THAT THE FACTS IN BOTH THE CASES ARE NOT SIMILAR, THEREFORE, THE NET PROFIT RATE ESTIMATED BY THE CIT, FAIZABAD UNDER SECTION 264 OF THE ACT IN THE CASE OF SHRI. TILAK RAM VERMA CANNOT BE APPLIED IN THE INSTANT CASE. THEREFORE , NET PROFIT RATE IS TO BE ESTIMATED INDEPENDENTLY WITHOUT BEING INFLUENCED BY THE NET PROFIT RATE ESTIMATED IN THE CASE OF SHRI. TILAK RAM VERMA. DURING THE COURSE OF HEARING BOTH THE PARTIES HAVE AGREED FOR ESTIMATE OF NET PROFIT RATE AT 6%. WE ACCORDI NGLY ESTIMATE THE NET PROFIT RATE AT 6% OF THE TOTAL TURNOVER AND DIRECT THE ASSESSING OFFICER TO ADOPT THE SAME AND CALCULATE THE NET PROFIT OF THE ASSESSEE. 6 . SO FAR AS THE ISSUE OF DEPRECIATION IS CONCERNED, THE TRIBUNAL VIDE ITS ORDER DATED 21.12.2009 H AS DIRECTED THE ASSESSING OFFICER TO ALLOW DEPRECIATION. THEREFORE, THIS ISSUE DOES NOT REQUIRE ANY ADJUDICATION AT THIS STAGE. 7 . ACCORDINGLY, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15.3.2013. SD/ - SD/ - [ J SUD HAKAR REDDY ] [ S UNIL KUMAR Y ADAV ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 15.3.2013 JJ: 1303 : - 4 - : COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR