Babuni Kumar Prusty, Angul V. ITO, Ward-1, Dhenkanal, Dhenkanal

ITA 338/CTK/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81442 (ITAT-CUTTACK)
• Duration Of Justice: 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 17-10-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 20-08-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Assessee Lawyers: S K SHETHMOHIT SHET

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH , CUTTACK BEFORE S/SHRI S.V.MEHROTRA (AM) AND GEORGE MATHAN (JM) I.T.A. NO. 338/CTK/2014 ASSESSMENT YEAR: 2010-2011 BABUNI KUMAR PRUSTY, PRUSTY EMPORIUM, SASAN BAZAR, BADAKERA, ANGUL-759001 PAN NO.ACPPP 0052 L ITO, WARD - 1, DHENKANAL. APPELLANT RESPONDENT FOR THE APPELLANT: SRI S.K.SHETH/MOHIT SHET FOR THE RESPONDENT: SHRI S.,C.MOHANTY DATE OF HEARING: 13/10/.2014 DATE OF PRONOUNCEMENT: 16 /10/2014 ORDER PER S.V.MEHROTRA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST ORDER DATED 11.6.2014 OF LD CIT(A)-1, BHUBANESWAR FOR THE ASSESSMENT YEAR 2010- 11. 2. IN THE GROUNDS OF APPEAL, THE ASSESSEE HAS CHALL ENGED THAT THE NET INCOME FROM BUSINESS AS ESTIMATED AT 1.25% BY WAY OF REJECTION OF BOOKS RESULTS IS UNREASONABLE AND EXCESSIVE. 3. FACTS IN BRIEF ARE THAT THE ASSESSEE, IN THE REL EVANT ASSESSMENT YEAR, DERIVED INCOME FROM SALE OF IMFL & BEER. HE FILED RETURN OF INCOM E ON 27.9.2010 SHOWING TOTAL INCOME OF RS.7,39,930/-. IN THE COURSE OF ASSESSMENT PROCEED INGS, THE AO REQUIRED THE ASSESSEE TO FURNISH THE VOUCHERS AND BILLS FOR VERIFICATION. H OWEVER, THE ASSESSEE SUBMITTED THAT VOUCHERS AND BILLS FOR EXPENSES HAD NOT BEEN MAINTAINED PROP ERLY FOR WHICH, HE WAS UNABLE TO FURNISH THE SAME FOR VERIFICATION. IT WAS IN THIS BACKDROP THA T THE ASSESSING OFFICER REJECTED THE BOOKS OF ACCOUNT AND ESTIMATED THE NET PROFIT BY TAKING RECO URSE TO THE PROVISIONS OF SECTION 145(3) OF 2 I.T.A. NO. 338/CTK/2014 ASSESSMENT YEAR: 2010-2011 THE ACT AND ESTIMATED THE NET PROFIT @ 1.25% OF THE GROSS RECEIPTS. BEING AGGRIEVED, ASSESSEE FILED APPEAL BEFORE LD CIT(A). 4. BEFORE LD CIT(A), IT WAS SUBMITTED BY THE ASSESS EE THAT THE ESTIMATE OF 1.25% IS ON THE HIGHER SIDE. THE ABOVE CONTENTION OF THE ASSESSEE WAS NOT ACCEPTABLE TO THE CIT(A) AND, ACCORDINGLY, HE CONFIRMED THE AOS ACTION, INTER AL IA, OBSERVING THAT THE ASSESSEE HAD NOT SUBMITTED ANY DETAILS FOR VERIFICATION; THAT ASSESS EE HAD SHOWN GROSS PROFIT AT 6.5%, THE NET PROFIT SHOWN WAS VERY LOW AT 0.71%. HE OBSERVED TH AT IN LIQUOR BUSINESS, THE ESTIMATION OF NET PROFIT @ 1.25% IS REASONABLE. BEING AGGRIEVED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 5. LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE P AST RECORD OF THE ASSESSEE WAS AS UNDER: ASSESSMENT YEAR SALES NET PROFIT 2009-10 8,83,56,554/- 0.73% 2008-09 6,96,01,539/- 0.75% 6. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH PARTI ES AND PERUSED THE RECORD OF THE CASE. IN THE COURSE OF HEARING, IT WAS POINTED OUT BY LD COUNSEL FOR THE ASSESSEE THAT ASSESSMENTS FOR ASSESSMENT YEARS 2009-10 AND 2008-09 WERE COMPLETED UNDER SECTION 143(1) AND, THEREFORE, SAME CANNOT BE ACCEPTED PARTICULARLY IN VIEW OF THE FACT THAT IN THE CURRENT ASSESSMENT YEAR ALSO, ASSESSEE HAS DISCLOSED NET PROFIT IN THE SAME RANGE AT 0.71%, WHICH WAS NOT VERIFIABLE WITH BILLS AND VOUCHERS. THEREFORE, CONSIDERING TH E ENTIRE CONSPECTUS OF THE CASE, WE ARE OF THE CONSIDERED VIEW THAT THE ESTIMATE OF NET PROFIT AT 1% OF THE GROSS RECEIPTS WOULD BE FAIR AND REASONABLE. WE ORDER ACCORDINGLY. 7. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS P ARTLY ALLOWED. SD/- SD/- ( GEORGE MATHAN) (S.V.MEHROTRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED, CUTTACK 16 /10/2014 B.K.PARIDA,SR. PS 3 I.T.A. NO. 338/CTK/2014 ASSESSMENT YEAR: 2010-2011 COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT: BABUNI KUMAR PRUSTY, PRUSTY EMPORIU M, SASAN BAZAR, BADAKERA, ANGUL-759001 2. THE RESPONDENT: ITO, WARD -1,DHENKANAL. 1. THE CIT, BHUBANESWAR 2. THE CIT(A), BHUBANESWAR 3. DR, CUTTACK BENCH 4. GUARD FILE. TRUE COPY// BY ORDER ASST. REGISTRAR, ITAT, CUTTACK