ITO, JODHPUR V. Shri Niyaz Mohammed, JODHPUR

ITA 358/JODH/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8016 (ITAT-JODHPUR)
• Duration Of Justice: 1 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 26-11-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 21-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R KOKANIDR
• Assessee Lawyers: N O N E
• Keywords: Rejection of books of accounts; Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K.SAINI, ACCOUNTANT MEMBER ITA NO. 358/JU/2011 [ASSESSMENT YEAR 2008-09] INCOME-TAX OFFICER, VS. SH. NIYAZ MOHAMMED, WARD-3(3), PROP. SANA CONSTRUCTION COM. JODHPUR. SUKURAM MANJIL, MOHALLA LAYKAN, JODHPUR. PAN NO. A DKPM3798E (APPELLANT) (RESPONDENT) ASSESSEE BY : N O N E DEPARTMENT BY : SHRI G.R. KOKANI(DR) DATE OF HEARING : 26.11.2012 DATE OF PRONOUNCEMENT : 11.12.2012 ORDER PER HARI OM MARATHA, J.M. THIS APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 2008 -09 IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A) DAT ED 12/08/2011. DESPITE BEING DULY SERVED, NOBODY CAME TO 2 REPRESENT THE CASE OF THE ASSESSEE/RESPONDENT, THER EFORE, WE HEARD THE APPEAL EX-PARTE. 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE WAS ENGAGED IN A CIVIL CONSTRUCTION WORK A ND EXECUTED CIVIL WORK THROUGH ITS PROPRIETARY CONCERN NAMELY M/S. SANA CONSTRUCTION CO. THE ASSESSEE HAS SHOWN A NET PROFIT RATE OF 1.57% AFTER ALLOWANCE OF EXPENSES AN D DEPRECIATION. THE ASSESSEE HAS NOT MAINTAINED DAY-T O-DAY STOCK REGISTER FOR THE MATERIAL AND FOR OTHER CONSU MABLES, INCLUDING PROPER-VOUCHERS, ET AL. AS A RESULT, THE A.O. HAS REJECTED THE BOOKS OF ACCOUNTS BY APPLYING PROVISIO NS OF SECTION 145(3) OF THE ACT AND HAS ADOPTED A NET PRO FIT RATE OF 12.5% AND HAS, THUS, COMPUTED TOTAL TAXABLE INCOME AT RS. 37,08,110/-, AFTER ALLOWING DEPRECIATION OF RS.5,35 ,056/- 3. AGGRIEVED, THE ASSESSEE FILED FIRST APPEAL AND L D. CIT(A) HAS ACCEPTED THE DECLARED RESULT AND HAS DELETED TH E ENTIRE ADDITION, SO MADE. NOW, THE REVENUE IS AGGRIEVED. F OLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL. 3 1. WHETHER OF THE FACTS AND CIRCUMSTANCES OF THE C ASE THE LD. CIT(A) HAS PERVERSELY DELETED THE ADDITION OF RS. 32,72,599/- MADE ON APPLYING N.P. RATE OF 12.5% BY THE A.O. IGNORING VITAL DISCREPANCIES AND OMISSIONS FOU ND AND THAT THE N.P. RATE OF 12.5% APPLIED BY THE A.O. IS VERY REASONABLE I THE LINE OF BUSINESS OF THE ASSES SEE. 2. THE LD. CIT(A), OUGHT TO HAVE UPHELD THE ORDER O F THE A.O. IN THE FACTS AND CIRCUMSTANCES OF THE CASE S. 4. AFTER HEARING LD. D.R. AT LENGTH IN THE LIGHT OF THE FACTS OF THIS CASE WE ARE OF THE CONSIDERED OPINION THAT NO INTERFERENCE IS WARRANTED AT OUR END IN THE FINDING GIVEN BY LD. CIT(A). CLEARLY, NO DEFECT, MUCH LESS ANY MATER IAL DEFECT, HAS BEEN PINPOINTED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. WITHOUT THERE BEING ANY MATERIAL DEFECT IN THE BOOK S, THE A.O. CANNOT REJECT THEM. THE RECORDS TO WHICH A.O. HAS REFERRED TO ARE NOT POSSIBLE TO MAINTAIN IN THE LIN E OF ASSESSEES BUSINESS. MERE NON-MAINTENANCE OF STOCK REGISTER OF PURCHASE AND CONSUMPTION OF RAW MATERIAL CANNOT BE MADE A GROUND FOR INVOKING SECTION 145(2). AGAIN, SELF-M ADE VOUCHERS CANNOT BE EASILY THROWN. THESE ARE ALSO V OUCHERS AND IN CERTAIN CIRCUMSTANCES THESE ARE NECESSARY, A ND HAVE 4 TO BE RELIED UNLESS CONTRARY IS PROVED. THE A.O HA S TO FIND OUT SPECIFIC DEFECT IN THEM AND EXPRESS AS TO WHY T HESE VOUCHERS ARE NOT BELIEVABLE. THE A.O. HAS ADOPTED A MAGIC FIGURE OF 12.5% AS N.P. RATE WHICH IS TOTALLY BASEL ESS. ACCORDINGLY, WE UPHOLD THE FINDING OF LD. CIT(A) AN D DONT FIND ANY MERIT IN THE GROUND TAKEN. THE FINDING OF CIT(A) IS NOT PERVERSE BUT IS WELL REASONED. ACCORDINGLY, WE CANNOT ALLOW THIS APPEAL. 5. IN THE RESULT, THIS APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE COURT ON 11 TH DECEMBER, 2012 SD/- SD/- (N.K.SAINI) [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 11 TH DECEMBER , 2012 VL/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) BY ORDER 5. THE DR ASSISTANT REGISTRAR ITAT, JODHPUR