DCIT, Sonepat V. M/s. Haryana Conductors Pvt. Ltd., Sonepat

ITA 3016/DEL/2014

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6433 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-03-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 06-03-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 16-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AMRIT LAL
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 143(3); 92; 145(3)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER I.T.A. NO. 3016/DEL/2014 A.Y. : 2010-11 DCIT, SONEPAT CIRCLE, SONEPAT HARYANA VS. M/S HARYANA CONDUCTORS PVT. LTD., 17 TH MILE STONE, NARELA ROAD, KUNDLI, SONEPAT (PAN: AAACH3125N) (APPELLANT) (RESPONDENT) DEPARTMENT BY : SH. AMRIT LAL, SR. DR ASSESSEE BY : SH. SANJIV SAPRA, CA ORDER PER H.S. SIDHU : JM THE REVENUE HAS FILED THIS APPEAL AGAINST THE IMP UGNED ORDER DATED 14.3.2014 PASSED BY THE LD. CIT(A), ROHTAK RE LEVANT TO ASSESSMENT YEAR 2010-11. 2. THE GROUNDS RAISED IN THE REVENUES APPEAL READ AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN DELETING THE ADDITION OF RS. 1,06,59,187/- MADE BY THE AO BY APPLYING THE GP RAT E @10.19% AS DECLARED BY THE ASSESSEE FOR THE AY 2008 -09 BY INVOKING THE PROVISIONS OF SECTION 145(3) OF THE I. T. ACT AND 2 REJECTING THE BOOKS OF ACCOUNT WITHOUT APPRECIATING THE FACTS OF THE CASE. 2. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER, MODIFY, DELETE AND OR CHANGE ANY OF THE ABOVE GROUNDS ON OR BEFOR E AT THE TIME OF HEARING. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E WAS ENGAGED IN THE BUSINESS OF MANUFACTURING OF ACSR AND AAC ALUMI NUM CONDUCTORS. THE RETURN FOR THE YEAR UNDER CONSIDE RATION WAS FILED ON 15.10.2010 DECLARING AN INCOME OF RS. 80,07,471/-. THE SAME WAS SELECTED FOR SCRUTINY U/S. 143(3) AND THE AO VIDE ITS ASSESSMENT ORDER DATED 28.3.2013 MADE AN ADDITION FOR A SUM OF RS. 1 ,06,59,187/- ASSESSING THE INCOME AT RS. 1,86,66,660/- BY ADOPTI NG THE GROSS PROFIT RATE AT 10.19%. 4. AGAINST THE SAID ORDER OF THE LD. AO, ASSESSEE APPEALED BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 14.3. 2014 HAS ALLOWED THE APPEAL OF THE ASSESSEE. 5. AGGRIEVED WITH THE AFORESAID ORDER OF THE LD. CIT(A), REVENUE IS IN APPEAL BEFORE THE TRIBUNAL 6. LD. DR RELIED UPON THE ORDER OF THE AO AND REITE RATED THE CONTENTIONS RAISED IN THE GROUNDS OF APPEAL AND STA TED THAT THE LD. CIT(A) HAS WRONGLY DELETED THE ADDITION. 3 7. ON THE CONTRARY, LD. COUNSEL OF THE ASSESSEE RE LIED UPON THE ORDER OF THE LD. CIT(A). 8. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDERS OF THE REV ENUE AUTHORITIES. WE FIND THAT LD. CIT(A) HAS ELABORATELY DISCUSSED THE ISSUE IN DISPUTE VIDE PARA NO. 3 AT PAGE NO. 8 OF THE IMPUGNED ORDER WHI CH READS AS UNDER:- 3. I HAVE EXAMINED THE SUBMISSIONS MADE BY THE APP ELLANT AND THE FACTS ON RECORD. THE AO HAS NOT BROUGHT ANY COHESIVE MATERIAL ON RECORD FOR REJECTING THE BOOKS OF ACCOUNT. MOREOVER, HE DID NOT MAKE COMPARISON, FOR THE PURPOSE OF CALCULATING THE GP, WITH THE IMMEDIATELY PRECEDING YEAR WHICH WOULD HAVE BEEN THE LOGICAL TH ING TO DO GIVEN THE FACT THAT THE GP FOR THIS YEAR HAS INC REASED TO 6.97% AS COMPARED TO 6.85% IN AY 2009-10. THE AO H AS NOT TAKEN A LOGISTIC VIEW OF THE ACCOUNTS; HE HAS N OT CONSIDERED THE TRENDS IN THE COST OF PRODUCTION VIS --VIS SALES REALIZATION. ALL DETAILS WERE PRODUCED BEFOR E THE AO AND NO SPECIFIC DEFECT OR DISCREPANCY IN THE BOOKS HAS BEEN POINTED OUT BY HIM. NOR WAS THE ASSESSEE CONFRONTE D WITH THE FACT THAT ITS BOOKS OF ACCOUNTS WERE BEING REJE CTED. THE 4 APPELLANT HAS SUBMITTED NUMEROUS CASE LAWS IN SUPPO RT OF ITS CLAIM. THEREFORE, THE GP RATE OF 6.97% IS ACCEP TED. IN VIEW OF THESE FACTS, I DELETE THE ADDITION OF RS . 1,06,59,187/- ON ACCOUNT OF GP RATE. 8.1 ON PERUSING THE ABOVE FINDING OF THE LD. CIT(A) , WE FIND THAT THE AO HAS NOT BROUGHT ANY COHESIVE MATERIAL ON RECORD FOR REJECTING THE BOOKS OF ACCOUNT. WE FURTHER NOTE THAT EVEN HE DI D NOT MAKE COMPARISON, FOR THE PURPOSE OF CALCULATING THE GP, WITH THE IMMEDIATELY PRECEDING YEAR WHICH WOULD HAVE BEEN TH E LOGICAL THING TO DO GIVEN THE FACT THAT THE GP FOR THIS YEAR HAS INC REASED TO 6.97% AS COMPARED TO 6.85% IN AY 2009-10. EVEN THE AO HAS NO T TAKEN A LOGISTIC VIEW OF THE ACCOUNTS; HE HAS NOT CONSIDERE D THE TRENDS IN THE COST OF PRODUCTION VIS--VIS SALES REALIZATION. AL L DETAILS WERE PRODUCED BEFORE THE AO AND NO SPECIFIC DEFECT OR DISCREPANCY IN THE BOOKS HAS BEEN POINTED OUT BY HIM. NOR WAS THE ASSESSEE CONF RONTED WITH THE FACT THAT ITS BOOKS OF ACCOUNTS WERE BEING REJECTED . WE FURTHER FIND THAT THE ASSESSEE HAS SUBMITTED NUMEROUS CASE LAWS IN SUPPORT OF ITS CLAIM. THEREFORE, THE LD. CIT(A) HAS RIGHTLY ACCEPT ED THE GP RATE OF 6.97% AND ACCORDINGLY, DELETED THE ADDITION OF RS. 1,06,59,187/- ON ACCOUNT OF GP RATE, WHICH DOES NOT NEED ANY INTERF ERENCE ON OUR PART, THEREFORE, WE UPHOLD THE ORDER OF THE LD. CIT(A) ON THE ISSUE IN DISPUTE AND ACCORDINGLY, DISMISS THE APPEAL OF THE REVENUE. 5 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/03/2017. SD/- SD/- [O.P. KANT] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICI AL MEMBER DATE 24/3/2017 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES