S VENKATESWARI, PERUNDURAI V. ACIT, CIRCLE-2, ERODE

ITA 3206/CHNY/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8191 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2015-2016
• Appeal Filed On: 26-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M. SUBASHRI
• Keywords: Principle of natural justice
• Section: 44AD

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: CHENNAI . . . , ! ' # , $ #% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ./ ITA NO.3206/CHNY/2018 & '& /ASSESSMENT YEAR: 2015-16 SMT. S. VENKATESWARI, PROP: SRI BALAMURUGAN AGENCIES, 18, NEW BUS STAND COMPLEX, KOVALI MAIN ROAD, PERUNDURAI 638 052. VS. ASST. COMMISSIONER OF INCOME TAX, CIRCLE-2, ERODE. [PAN: AEBPV 2163E] ( () /APPELLANT) ( *+() /RESPONDENT) () , - / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE *+() , - /RESPONDENT BY : MS. M. SUBASHRI, JCIT . , /$ /DATE OF HEARING : 04.03.2019 01' , /$ / DATE OF PRONOUNCEMENT : 27.03.2019 / O R D E R PER INTURI RAMA RAO, ACCOUNTANT MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AG AINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -3, COIMBATORE (HEREINAFTER CALLED AS CIT(A)) DATED 30.10.2018 F OR THE ASSESSMENT YEAR (AY) 2015-16. 2. THE APPELLANT RAISED THE FOLLOWING GROUNDS OF AP PEAL: 1) THE ORDER OF THE LEARNED CIT(A) IS ERRONEOUS IN LAW AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE. ITA NO.3206/CHNY/2018 (AY: 2015-16) :- 2 -: 2) THE LEARNED CIT (A) AS WELL AS THE ASSESSING OFF ICER ERRED IN TAKING SEC.44AD OF THE IT ACT AS THE BASIS FOR DETE RMINING THE INCOME, WITHOUT CONSIDERING THE FACT THAT ONCE THE TOTAL TURNOVER EXCEEDS THE PRESCRIBED LIMIT THEREIN, SEC.444AD CAN NOT BE APPLIED AT ALL. 3) THE LEARNED CIT (A) SIMPLY ENDORSED THE VIES OF THE ASSESSING OFFICER WITHOUT CONSIDERING THE DIFFERENCE IN THE B USINESS ACTIVITIES CARRIED ON BY THE APPELLANT, NAMELY TRADING IN MANG ANESE ORE, BUSINESS OF PLYING BUSES AND GETTING INCOME FROM LO RRY, ETC., AND FOR OTHER REASONS THAT MAY BE ADDUCED AT THE TI ME OF HEARING, YOUR APPELLANT PRAYS THAT THE APPEAL BE ADMITTED, C ONSIDERED AND JUSTICE BE RENDERED. 3. THE BRIEF FACTS OF THE CASE ARE AS UNDER: THE APPELLANT IS AN INDIVIDUAL ENGAGED IN THE BUSI NESS OF TRADING IN IRON ORE AND TRAVEL AGENCY AND COMMISSION AGENT. T HE RETURN OF INCOME FOR THE AY 2015-16 WAS FILED ON 31.03.2017 DISCLOSI NG TOTAL INCOME OF RS. 8,70,200/-. AGAINST THE SAID RETURN OF INCOME, THE ASSESSMENT WAS COMPLETED BY THE ASST. CIT, CIRCLE-2, ERODE VIDE OR DER DATED 26.12.2017 ASSESSING THE TOTAL INCOME @ 8% OF THE TOTAL TURNOV ER OF RS. 8,70,20,458/-. 4. BEING AGGRIEVED BY THE ABOVE ADDITION, AN APPEAL WAS PREFERRED BEFORE LD. CIT(A), WHO VIDE IMPUGNED ORDER DISMISSE D THE APPEAL. BEING AGGRIEVED, THE APPELLANT IS IN APPEAL BEFORE US IN THE PRESENT APPEAL. 5. WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE M ATERIAL ON RECORD. ADMITTEDLY NO BOOKS OF ACCOUNT HAVE BEEN MAINTAINED BY THE ASSESSEE IN THE ABSENCE OF BOOKS OF ACCOUNTS THE AO HAD TO RESORT ITA NO.3206/CHNY/2018 (AY: 2015-16) :- 3 -: ESTIMATION OF PROFIT @ 8% OF THE TURNOVER. THERE IS NO DISPUTE AS TO THE AMOUNT OF THE TURNOVER. IT IS STATED BEFORE US THA T DURING THE YEAR UNDER CONSIDERATION, MOST OF THE TURNOVER IS FROM THE BUS INESS OF COMMISSION EARNED FROM HIRING OF LORRIES AND THE ASSESSEE OWNS ONLY 5 LORRIES AND THEREFORE, THE AO WAS NOT JUSTIFIED IN ESTIMATING P ROFIT @ 8% OF THE TOTAL TURNOVER. THE PROVISIONS OF S. 44AD ARE NOT APPLIC ABLE AS THE TURNOVER OF THE ASSESSEE IS ABOVE RS. 2 CRORES. THEREFORE, WE ARE OF THE CONSIDERED OPINION THAT THE AO WAS NOT JUSTIFIED IN ESTIMATING PROFIT @ 8% OF THE TOTAL TURNOVER, WE REMIT BACK THIS ISSUE TO THE FILE OF T HE AO WITH A DIRECTION THAT TO FRAME THE ASSESSMENT ORDER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE THAT THE BUSINESS IS MOSTLY FROM TH E COMMISSION EARNED ON THE HIRING OF LORRIES. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THE 27 TH DAY OF MARCH, 2019 IN CHENNAI. SD/- SD/- ( . . . ) (N.R.S. GANESAN) /JUDICIAL MEMBER ( ! ' # ) (INTURI RAMA RAO) $ /ACCOUNTANT MEMBER /CHENNAI, 2 /DATED: 27 TH MARCH, 2019. EDN, SR. P.S , */34 54'/ /COPY TO: 1. () /APPELLANT 2. *+() /RESPONDENT 3. . 6/ ( )/CIT(A) 4. . 6/ /CIT 5. 47 */ /DR 6. & 8 /GF