Bijay Kumar Mohapatra, Bhadrak V. ITO, Bhadrak

ITA 290/CTK/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2647 (ITAT-CUTTACK)
• Duration Of Justice: 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-06-2013
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 09-05-2013
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Assessee Lawyers: B PANDA
• Keywords: Depreciation

Judgement Text

1 ITA NO. 290/CTK/2013 BIJAY KR. MOHAPATRA, AY 2010-11 IN THE INCOME TAX APPELLATE TRIBUNAL: CUTTACK BENCH : CUTTTACK (BEFORE SHRI K. K. GUPTA, AM & SHRI GEORGE MATHAN, JM) ITA NO. 290/CTK/2013 ASSESSMENT YEAR: 2010-11 BIJAY KUMAR MOHAPATRA VS. INCOME-TAX OFFICER, B HADRAK WARD, (PAN: ACHPM9398L) BHADRAK (APPELLANT) (RESPONDENT) DATE OF HEARING: 5TH JUNE, 2013 DATE OF PRONOUNCEMENT: 5TH JUNE, 2013 APPELLANT BY: SHRI B. PANDA, AR RESPONDENT BY: SHRI S. C. MOHANTY, DR ORDER PER BENCH: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF CIT(A), CUTTACK IN APPEAL NO. 0262/2012-13 DATED 30.04.2013 FOR AY 201 0-11. 2. SHRI B. PANDA APPEARED ON BEHALF OF THE ASSESSEE AND SHRI S. C. MOHANTY APPEARED ON BEHALF OF REVENUE. 3. IN ASSESSEES APPEAL THE ASSESSEE HAS RAISED FOL LOWING GROUNDS: 1. FOR THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ORDER OF ASSESSMENT PASSED ESTIMATING THE NET PROFIT @ 6 PER CENT AFTER REJECTING THE BOOKS OF AC COUNT AND THE MAJOR EXPENSES INCURRED ON PURCHASE OF MATERIALS, LABOUR CHARGES, TRANSPORTATION AND MACHINE HIRE CHARGES SHOULD HAVE BEEN APPRECIAT ED TO ADOPT LOWER AND LESSOR RATE OF PROFIT TO WHICH THE LD. CIT(A) IGNOR ED. 2. FOR THAT ON THE FACTS AND CIRCUMSTANCES OF THE C ASE THE LD. AO AS WELL AS THE LD. CIT(A) WERE NOT JUSTIFIED IN NOT ALLOWING T HE DEPRECIATION AND BANK INTEREST PAID DISCLOSED SEPARATELY AGAINST THE INCO ME ESTIMATED BY APPLYING A NET PROFIT PERCENTAGE. 3. FOR THAT THE RATES OF PROFIT DETECTED FOR ADOPTI ON AND FOUND FROM THE CASES OF THE HONBLE SECOND APPELLATE AUTHORITIES WERE IN HIGHER SIDE, DISTINGUISHABLE AND NOT APPLICABLE TO THE CASE OF T HE APPELLANT, HENCE PROFIT SHOWN BY THE APPELLANT SHOULD HAVE BEEN ACCEPTED. 4. IT WAS THE SUBMISSION BY THE LD. AR THAT THE ASS ESSEE IS IN THE BUSINESS OF ROAD WORK CONTRACT MORE SO CIVIL CONTRACTOR. IT WAS THE SUBMISSION THAT THE BOOKS OF THE 2 ITA NO. 290/CTK/2013 BIJAY KR. MOHAPATRA, AY 2010-11 ASSESSEE HAD BEEN REJECTED BY THE AO AND THE AO HAD ESTIMATED ASSESSEES INCOME AT 6% OF THE GROSS RECEIPTS. IT WAS THE SUBMISSION THAT NO COMPARATIVE CASE HAD BEEN CONSIDERED BY THE AO. IT WAS THE SUBMISSION THAT THE ASSESSEE HAS BEEN DECLARING INCOME IN THE EARLIER YEARS AT APPROXIMATELY 1.35% TO 2.5%. IT WAS THE S UBMISSION THAT THE ESTIMATION AS DONE BY AO MAY BE REDUCED. 5. IN REPLY, THE LD. DR VEHEMENTLY SUPPORTED THE OR DER OF AO. IT WAS THE SUBMISSION THAT THE ESTIMATION AT 6% WAS REASONABLE. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE ASSESSMENT ORDER CLEARLY SHOWS THAT THE AO HAS REJECTED THE ASSESSEE S BOOKS OF ACCOUNT AND HAS ESTIMATED THE INCOME AT 6%. HOWEVER, THE AO HAS NOT BEEN ABL E TO POINT OUT ANY COMPARATIVE CASE WHEN HE ESTIMATED THE INCOME OF THE ASSESSEE AT 6%. A PERUSAL OF THE P&L ACCOUNT IN THE ASSESSEES CASE FOR THE RELEVANT ASSESSMENT YEAR SH OWS A NET PROFIT MARGIN AT 1.35%. AS BOOKS OF ACCOUNT OF THE ASSESSEE HAVE BEEN REJECTED AND CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW T HAT INCOME OF THE ASSESSEE SHOULD BE ESTIMATED AT 4.5% OF THE GROSS BILLS. THE ASSESSEE GETS RELIEF OF 1.5%. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 8. ORDER IS PRONOUNCED IN THE OPEN COURT. SD/- SD/- (K. K. GUPTA) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 5TH JUNE, 2013 (JD) SR. P.S COPY FORWARDED TO :- 1. APPELLANT BIJAY KUMAR MOHAPATRA, AT/PO RANDIA, DI ST, BHADRAK 2. RESPONDENT- ITO, BHADRAK WARD, BHADRAK 3. CIT(A), CUTTACK 4. CIT,.CUTTACK 5. DR, ITAT, CUTTACK TRUE COPY BY ORDER SR. PVT. SECY. ITAT, CUTTACK