M/s Kuldeep Singh Controctor, Etawah V. Dy.C.I.T.-5, Firozabad

ITA 360/AGR/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0286 (ITAT-AGRA)
• Duration Of Justice: 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 11-01-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 23-07-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KK MISHRA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 360/AGRA/2012 ASSTT. YEAR : 2006-07 M/S. KULDEEP SINGH CONTRACTOR, VS. DY. C.I.T., C IRCLE-5, JAWAHAR ROAD, BHARTHANA, FIROZABAD. ETAWAH. (PAN : AAFFK 6665 G) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANURAG SINHA, ADVOCATE RESPONDENT BY : SHRI K.K. MISHRA, JR. D.R. DATE OF HEARING : 11.01.2013 DATE OF PRONOUNCEMENT OF ORDER : 18.01.2013 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A)-II, AGRA DATED 22.03.2012 FOR THE ASSESSMENT YEAR 2006- 07. 2. THE LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS G ROUND NO. 1 OF APPEAL OF THE ASSESSEE. THE SAME IS ACCORDINGLY DISMISSED. 3. ON THE REMAINING GROUND NO. 2 TO 4, THE ASSESSEE CHALLENGED ADDITION OF RS.7,50,000/- ON ACCOUNT OF DISALLOWANCE OUT OF VAR IOUS EXPENSES. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE WAS CARRYIN G ON THE BUSINESS OF CIVIL ITA NO. 360/AGRA/2012 2 CONTRACTOR. THE ASSESSEE DID NOT PRODUCE SINGLE BIL L AND VOUCHER FOR PURCHASE OF MATERIAL AND EXPENSES FOR VERIFICATION BEFORE THE A O. THUS, VERIFICATION OF THE PURCHASE OF MATERIAL AND EXPENDITURE INCURRED COULD NOT HAVE BEEN POSSIBLE. THE ASSESSEE DID NOT PRODUCE MATERIAL BEFORE THE AO TO SUPPORT THE INCOME DECLARED IN THE RETURN OF INCOME. THE ASSESSEE ONLY PRODUCED PR INTOUT OF CASH BOOK AND LEDGER. ACCORDINGLY, BOOK RESULTS OF THE ASSESSEE WERE REJE CTED. THE AO FOUND THAT THE ASSESSEE HAS EXECUTED FIVE CONTRACTS WITH THE GOVER NMENT DEPARTMENTS AND ON GOING THROUGH THE DETAILS OF WORK EXECUTED BY THE A SSESSEE, THERE WERE DIFFERENCE IN THE RECEIPTS. SUBSTANTIAL AMOUNTS WERE SPENT ON ACCOUNT OF CONSTRUCTION. SINCE, NO BILLS OF PURCHASE OF MATERIAL, SERVICE AND LABOU R WERE PRODUCED, THEREFORE, NO EXPENDITURE WAS SUBJECT TO VERIFICATION. THE AO ALS O FOUND THAT THE ASSESSEE HAS CLAIMED JCB RENT OF RS.4,80,930/-, WHICH IS USED FO R DIGGING EARTH WORK. THEREFORE, IN THE ABSENCE OF ANY EVIDENCE OR MATERI AL, RS.1,00,000/- WAS DISALLOWED. FURTHER, UNDER THE LABOUR EXPENSES, IN THE ABSENCE OF ANY EVIDENCE ON RECORD, RS.3,00,000/- WAS DISALLOWED OUT OF LABOUR EXPENSES AND SIMILARLY, IT WAS FOUND THAT THE ASSESSEE HAS MAINLY EXECUTED WORK OF SUPPLY OF STONE GRIT AND STONE BALLAST FOR WHICH NO EVIDENCES HAVE BEEN PRODUCED A ND THE ASSESSEE HAS EXECUTED WORK OF RS.79,61,398/-. THEREFORE, RS.3,50,000/- WA S DISALLOWED. ACCORDINGLY, RS.7,50,000/- WAS DISALLOWED OUT OF EXPENSES ABOVE. THE ASSESSEE DID NOT APPEAR BEFORE THE LD. CIT(A) DESPITE VARIOUS OPPORTUNITIES OF BEING HEARD, THEREFORE, THE ITA NO. 360/AGRA/2012 3 APPEAL OF THE ASSESSEE WAS DISMISSED BECAUSE THE AS SESSEE WAS NOT ABLE TO SUBSTANTIATE ANY GROUND OF APPEAL. 4. THE LD. COUNSEL FOR THE ASSESSEE SOLELY ARGUED T HAT THE ASSESSEE HAS IN FACT SHOWN HIGHER NET PROFIT RATE OF 7.48% AS AGAINST 6. 37% AS COMPARED TO THE PRECEDING ASSESSMENT YEAR. THEREFORE, ADDITIONS ARE UNJUSTIFIED. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDERS OF THE AUTHORITIE S BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IT IS NOT IN DISPUTE THAT THE ASSESSEE DID NOT PRODUCE ORIGINAL BOOKS OF ACCOUNT BEFORE THE AO AND NO SINGLE BILL OR VOUCHERS FOR PURCHASE OF MATERIAL OR EXPENS ES WERE PRODUCED BEFORE THE AO FOR VERIFICATION. THEREFORE, BOOK RESULTS OF THE AS SESSEE HAVE BEEN RIGHTLY REJECTED. NOTHING WAS PRODUCED BEFORE THE LD. CIT(A) AND EVEN BEFORE US AND NO MATERIAL IS PRODUCED TO CONTRADICT THE FINDINGS OF THE AUTHORIT IES BELOW. THE AO DISALLOWED RS.1,00,000/- OUT OF THE AMOUNT DEBITED TO THE JCB RENT OUT OF TOTAL CLAIM OF RS.4,80,930/-. IN THE ABSENCE OF ANY MATERIAL ON RE CORD, WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDERS OF THE A UTHORITIES BELOW AND ACCORDINGLY, ADDITION OF RS.1,00,000/- IS CONFIRMED. HOWEVER, AS REGARDS THE REMAINING ADDITION OF RS.6,50,000/- ON ACCOUNT OF DISALLOWANCE OF LABO UR EXPENSES AND EXPENDITURE INCURRED FOR PURCHASE OF MATERIAL, WE FIND THAT THO UGH THE ASSESSEE HAS NOT PRODUCED ANY MATERIAL BEFORE THE AUTHORITIES BELOW, BUT IT IS A FACT THAT THE ASSESSEE ITA NO. 360/AGRA/2012 4 EXECUTED THE CONTRACT WORK WITH VARIOUS GOVERNMENT DEPARTMENTS AND IN THE WORK DONE FOR THE GOVERNMENT DEPARTMENTS, THE PROFIT MAR GIN IS NOT SO HIGHER AS COMPARED TO THE OTHER CONTRACTS. THE ASSESSEE HAS S HOWN THAT HE HAS ALREADY SHOWN BETTER NET PROFIT RATE IN THE ASSESSMENT YEAR UNDER APPEAL AS COMPARED TO THE EARLIER YEARS, WHICH IS NOT DISPUTED BY THE LD. DR. THEREFO RE, WE ARE OF THE VIEW THAT EXCESSIVE DISALLOWANCE HAVE BEEN MADE IN A SUM OF R S.6,50,000/-. THE SAME ADDITION IS MODIFIED TO THE EXTENT OF RS.4,00,000/- AS AGAINST THE ADDITION OF RS.6,50,000/-. THE ORDERS OF THE AUTHORITIES BELOW ARE ACCORDINGLY MODIFIED TO THAT EXTENT AND THE AO IS DIRECTED TO MAKE ADDITION OF R S.4,00,000/- OUT OF ADDITION OF RS.6,50,000/-. IN VIEW OF THE ABOVE DISCUSSION, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 6. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY