N.M. & PARTY(BALAJI WINES), Jaipur V. ACIT, Jaipur

ITA 309/JPR/1999

• Counselvise Citation: 30923114 RSA 1999
• Duration Of Justice: 14 year(s) 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 1995-1996
• Appeal Filed On: 05-06-1999
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D C SHARMA
• Section: 143(3); 145; 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH, JAIPUR (BEFORE SHRI RAJ PAL YADAV AND SHRI R.C. SHARMA) ITA NO. 309/JP/1999 ASSESSMENT YEAR :1995-96 M/S. N.M. & PARTY (BALAJI WINES) VS. THE DCIT JAIPUR S.R.1, JAIPUR (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI P.C. PARWAL DEPARTMENT BY: SHRI D.C. SHARMA DATE OF HEARING: 23-05-2014 DATE OF PRONOUNCEMENT: 30-05-2014 ORDER PER R.C. SHARMA, AM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST O RDER OF THE LD. CIT(A) DATED 05-04-1999 FOR THE ASSESSMENT YEAR 1995-96, I N THE MATTER OF ORDER PASSED U/S 143(3) READ WITH SECTION 148 OF THE I.T. ACT, 1961. 2.1 AT THE OUTSET, IT IS BEING BROUGHT ON RECORD TH AT THIS APPEAL WAS DECIDED BY THE TRIBUNAL VIDE ITS ORDER DATED 22-11- 2004. AGAINST THE ORDER OF THE TRIBUNAL, ASSESSEE APPROACHED THE HON'BLE H IGH COURT, AND THE HON'BLE HIGH COURT VIDE ITS ORDER DATED 21-01-2014 SET ASIDE THE ORDER OF THE 2 TRIBUNAL FOR DECIDING AFRESH AND DENOVO THE ISSUE O F TRADING ADDITION MADE AFTER INVOKING THE PROVISION OF SECTION 145(3) OF T HE ACT IN ACCORDANCE WITH LAW. THE HON'BLE HIGH COURT HAS ALSO DIRECTED ITAT TO DECIDE THESE APPEALS EXPEDITIOUSLY NOT LATER THAN 06 MONTHS FROM THE DAT E PARTIES ARE CALLED TO PUT THEIR APPEARANCE BEFORE ITAT. IN ACCORDANCE WITH DI RECTION OF HON'BLE HIGH COURT, THIS APPEAL WAS AGAIN FIXED AND HEARD ON MER IT AND ARE DECIDED AFRESH IN THE FOLLOWING MANNER. 2.2 THE RIVAL CONTENTIONS HAVE BEEN HEARD AND RECOR DS PERUSED. THE FACTS IN BRIEF ARE THAT THE ASSESSEE AOP IS A LIQUOR CONT RACTOR AND HAS OBTAINED CONTRACT FOR SELLING IMFL ON WHOLESALE BASIS, COUNT RY LIQUOR, BEER ETC. RETURN OF INCOME WAS FILED AT RS. 2.43 CRORES. ON G OING THROUGH THE BOOKS OF ACCOUNT, THE AO NOTICED THAT THE PRIMARY SALES R ECORDS AND THE CASH MEMOS WERE NOT MAINTAINED BY THE ASSESSEE. IT WAS S UBMITTED BY THE ASSESSEE THAT IN THIS LINE OF BUSINESS IT WAS NOT POSSIBLE TO ISSUE CASH MEMOS AND THAT CASH MEMOS HAD NEVER BEEN ISSUED BY ANY LI QUOR CONTRACTOR AT ANY OF THE SHOP DUE TO PECULIAR NATURE OF THE TRADE. HO WEVER, THE AO DID NOT AGREE AND HAD INVOKED THE PROVISION OF SECTION 145 OF THE ACT. ON CONSIDERATION OF THE PROVISION OF SECTION 44AC AND SOME COMPARABLE CASES, A TRADING ADDITION OF RS. 15.00 LACS HAD BEEN MADE. 3 2.3 BY THE IMPUGNED ORDER, THE LD. CIT(A) CONFIRMED THE TRADING ADDITION AND AGAINST WHICH THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 2.4 WE HAVE CONSIDERED THE RIVAL CONTENTIONS, GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND THAT THE ASSESSEE H AS DECLARED THE GROSS PROFIT RATE OF 72.40% ON COUNTRY LIQUOR AND GROSS P ROFIT RATE OF 23.32% ON IMFL/BEER AGAINST GROSS PROFIT RATE OF 5.70% IN THE IMMEDIATELY PRECEDING YEAR. WE ALSO FOUND THAT THE ASSESSEE HAD PAID SHOR T LICENSE FEE OF RS. 17.56 CRORES IN CASE OF COUNTRY LIQUOR AND RS. 14.15 CROR ES IN CASE OF IMFL/BEER. THUS EVEN AFTER PAYMENT OF SHORT LICENSE FEE, THERE REMAINS GROSS PROFIT RATE OF 10.45% IN CASE OF COUNTRY LIQUOR AND 2.24% IN CA SE OF IMFL/BEER. WE FOUND THAT THE GROSS PROFIT RATE SHOWN BY THE ASSES SEE IN IMFL/BEER IS COMPARATIVELY BETTER DURING THE YEAR AS COMPARED TO PRECEDING YEAR. HOWEVER, IN CASE OF COUNTRY LIQUOR, EVEN THOUGH THE GROSS PROFIT RATE WAS SLIGHTLY DECLINED, WE FOUND THAT IN OTHER CASES AL SO AS REFERRED TO BY THE AO IN HIS ORDER THE GROSS PROFIT RATE BEEN DECLINED. T HUS THE ASSESSEE'S GROSS PROFIT RATE IS BETTER AS COMPARED TO OTHER CASES DI SCUSSED BY THE AO. HOWEVER, KEEPING IN VIEW DEFECT IN ACCOUNTS AS PO INTED OUT BY THE AO WITH REGARD TO NON-MAINTENANCE OF SALE BILLS AND ALSO KE EPING IN VIEW THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE DEEM IT APPROPRIATE TO SUSTAIN 4 THE ADDITION TO RS. 5.00 LACS OUT OF TOTAL ADDITION OF RS. 15.00 LACS MADE BY THE AO TO COVER UP ANY LEAKAGE OF REVENUE DUE TO AB SENCE OF SALE BILLS. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED IN PART ORDER PRONOUNCED IN THE OPEN COURT ON 30 -05-2014 . SD/- SD/- (RAJ PAL YADAV) (R.C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR DATED: 30 TH MAY, 2014 *MISHRA COPY FORWARDED TO:- 1. M/S. N.M. & PARTY, (BALAJI WINES) JAIPUR BY ORDER 2. THE DCIT, S.R.1, JAIPUR 3. THE LD. CIT 4. THE LD. CIT(A), JAIPUR 5..THE LD. DR 6.THE GUARD FILE (IT NO.309/JP/1999) AR ITAT, JAI PUR 5