B.V.Ravindra Reddy, Kurnool, Kurnool V. DCIT, Circle-1, Kurnool, Kurnool

ITA 326/HYD/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6403 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-06-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 18-03-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K J RAO
• Keywords: Cost of acquisition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ITA.NO.326/HYD/2016 ASSESSMENT YEAR 2011-2012 MR. B.V.RAVINDRA REDDY, KURNOOL. PAN AOOPR8277A VS. DCIT, CIRCLE - 1, KURNOOL. (APPELLANT) (RESPONDENT) FOR ASSESSEE : - NONE - FOR REVENUE : MR. K.J. RAO DATE OF HEARING : 21.06.2016 DATE OF PRONOUNCEMENT : 21.06.2016 ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A), KURNOOL AND IT PERT AINS TO THE A.Y. 2011-2012. 2. AT THE OUTSET, IT MAY BE NOTICED THAT THE ASSESSEE FILED ELABORATE GROUNDS ALONG WITH STATEME NT OF FACTS AND CASE LAW WHICH IS CONTRARY TO RULE-8 OF T HE APPELLATE TRIBUNAL RULES SINCE THE GROUNDS OF APPEA L SHOULD BE CONCISE AND THERE IS NO PROVISION FOR FIL ING STATEMENT OF FACTS BEFORE THE APPELLATE TRIBUNAL. 3. IN FORM-36, IN THE COLUMN ADDRESS TO WHICH NOTICE MAY BE SENT TO THE APPELLANT THE ASSESSEE H AS FURNISHED THE FOLLOWING ADDRESS : 2 ITA.NO.326/HYD/2016 MR. B.V. RAVINDRA REDDY, HYDERABAD. D.NO.40/581-A, S.V. COMPLEX, KURNOOL. 3.1. IN THE GROUNDS OF APPEAL, THE ASSESSEE CHOSE TO FURNISH A DIFFERENT ADDRESS I.E., DOOR NO.40/389, D VR COMPLEX, R.S. ROAD, KURNOOL. AS PER THE PROCEDURE PRESCRIBED UNDER I.T. RULES, THE NOTICE HAS TO BE S ENT TO THE ASSESSEE AT THE ADDRESS GIVEN IN FORM-36 AND ACCORDINGLY, NOTICE WAS SENT TO THE ASSESSEE AT D.NO.40/581-A, S.V. COMPLEX, KURNOOL WHICH WAS RETURNED UN-SERVED WITH THE POSTAL REMARK INSUFFIC IENT ADDRESS. SINCE THE ASSESSEE DID NOT CHOSE TO FURNI SH THE CORRECT ADDRESS, WE PROCEED TO DISPOSE OF THE APPEA L EX- PARTE, QUA THE ASSESSEE. 4. THE ASSESSEE IS RUNNING A WINE SHOP AND FOR THE YEAR UNDER CONSIDERATION, HE FILED TOTAL INCOME OF RS.35,11,390 WHEREAS THE ASSESSMENT WAS COMPLETED B Y ESTIMATING THE INCOME OF THE ASSESSEE AT 5% OF THE PURCHASE COST. THUS, THE A.O. COMPUTED THE INCOME A T RS.83,17,764. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE PRODUCED BOOKS OF ACCOUNT WHERE A.O. NOTICED THAT SALES ARE NOT SUPPORTED BY BILLS THOUGH PURCHASES ARE FROM A.P. BEVERAGES CORPORATIO N LTD., BY FOLLOWING THE DECISION OF ITAT B BENCH, HYDERABAD IN THE CASE OF MAYURI WINES AND OTHERS (ITA.NOS.148 TO 177/HYD/2012) DATED 07.05.2012), HE ESTIMATED THE NET PROFIT OF 5% OF THE PURCHASE COST BY CLEARLY MENTIONING THAT THOUGH THE SAME WAS PUT TO THE 3 ITA.NO.326/HYD/2016 MR. B.V. RAVINDRA REDDY, HYDERABAD. ASSESSEE THE A.R. OF THE ASSESSEE WAS SILENT; HE NE ITHER ACCEPTED NOR OBJECTED TO THE A.OS. PROPOSAL. 5. BEFORE THE CIT(A), IT WAS CONTENDED THAT THE ESTIMATION OF INCOME BY THE A.O. IS UNFAIR AND THEY ARE NOT MATERIALLY CONNECTED TO THE FACTS OF THE CASE. IT WAS ALSO CONTENDED THAT THE ASSESSEE IS A WHOLESALE DEA LER IN LIQUORS AND MAJORITY OF THE SALES ARE TO BE WHOLESA LE CONSUMERS WHEREIN PROFIT MARGIN IS 2% ONLY AND HENC E, THE A.O. IS NOT JUSTIFIED IN ESTIMATING THE INCOME/ PROFIT AT 5%. 6. THE ASSESSEE HAS NOT PLACED GROUNDS AND STATEMENT OF FACTS FILED BEFORE THE CIT(A) AND EVEN IN FORM-36 THE ADDRESS TO WHICH THE NOTICE MAY BE SENT TO THE RESPONDENT WAS ALSO WRONGLY MENTIONED AS COMMISSIONER OF INCOME TAX INSTEAD OF FURNISHING CORRECT ADDRESS OF THE RESPONDENT. 7. WITH REGARD TO ISSUE OF ESTIMATION OF INCOME, THE LD. CIT(A) OBSERVED THAT NO CONTRARY DECISIONS WERE PLACED ON RECORD AND THEREFORE, THE LD. CIT(A) FOLL OWED THE DECISION OF ITAT IN THE CASE OF ITO, WARANGAL VS. S HRI P. RAMAIAH AND OTHERS (ITA.NO.1739/HYD/2012 DATED 21.03.2013). THOUGH THE ASSESSEE PREFERRED AN APPEA L BEFORE THE TRIBUNAL NO REPORTED DECISION WAS PLACED BEFORE US AND NO MATERIAL WHATSOEVER WAS FURNISHED TO CONTRADICT THE FINDINGS OF THE A.O. AS WELL AS CIT( A). UNDER THESE CIRCUMSTANCES, WE DO NOT FIND ANY INFIRMITY I N THE 4 ITA.NO.326/HYD/2016 MR. B.V. RAVINDRA REDDY, HYDERABAD. ORDER PASSED BY THE CIT(A) AND THEREFORE, DISMISS T HE APPEAL FILED BY THE ASSESSEE. ORDER PRONOUNCED IN THE OPEN COURT ON 21.06. 2016. SD/- SD/- (PRADIP KUMAR KEDIA) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT HYDERABAD DATED 21 ST JUNE, 2016 VBP/- COPY TO 1. MR. B.V. RAVINDRA REDDY, D.NO.40/581 - A, S.V. COMPLEX, KURNOOL. 3. THE DCIT, CIRCLE - 1, KURNOOL. 4. CIT(A), KURNOOL. 5. PR. CIT, KURNOOL. 5. D.R. ITAT B BENCH, HYDERABAD. 6. GUARD FILE