M/s. Konark Fruits, Jeypore V. ITO, Ward-1, Jeypore, Jeypore

ITA 396/CTK/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 8813 (ITAT-CUTTACK)
• Duration Of Justice: 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 16-10-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: P C SETHI
• Keywords: Business income

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH, CUTTACK BEFORE SHRI P. K. BABNSAL, HONBLE ACCOUNTANT MEMBER AND SHRI D.T. GARASIA, HONBLE JUDICIAL MEMBER ITA NO. 396 / CTK /201 4 (ASST. YEAR : 2011 - 1 2 ) M/S. KONARK FRUITS, DAILY MARKET, JEYPORE, DIST. KORAPUT, ODISHA VS. ITO, WARD - 1, JEYPORE. PAN NO. AAEFK 5789 N (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI P.C. SETHI A . R . DEPARTMENT BY : SHRI ANIL SHARMA - D.R. DATE OF HEARING : 04 / 0 2 /2015 . DATE OF PRONOUNCEMENT : 0 4 / 0 2 /201 5 . O R D E R PER D.T. GARASIA , J .M THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT (A), BERHAMPUR DATED 0 2/0 7 /201 4 FOR THE A.Y. 20 11 - 12 . 2. THE FOLLOWING GROUNDS ARE RAISED BY THE ASSESSEE : 1. FOR THAT WITHOUT KEEPING ANY MATERIAL ON RECORD TO SHOW TAHT THE APPELLANT HAD INFLATED THE PURCHASES AND EXPENSES, ESTIMATING THE GROSS PROFIT @ 8% ON GROSS SALES BY THE ASSESSING OFFICER AND CONFIRMING THE SAME BY CIT(A) IS WITHOUT ANY BASIS, ARBITRARY A ND HIGH IN THE CIRCUMSTANCES OF THE CASE. 2. FOR SUCH OTHER GROUNDS TO BE ARGUED AT THE TIME OF HEARING, THE ADDITION MADE TO THE RETURNED INCOME MAY KINDLY BE ANNULLED. 2 3. SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE HAS FILED THE RETURN OF INCOME ON 14/08/2011 . THE ASSESSEE DERIVES INCOME FROM WHOLESALE TRADING IN BANANA BUSINESS. THE ASSESSEE HAS PRODUCED THE BOOKS OF ACCOUNTS AND THEY WERE EXAMINED WITH REFERENCE TO THE AUDITED STATEMENT OF ACCOUNT, BANK ACCOUNT ETC. AND HE WAS HEARD. THE ASSESSE E HAS EFFECTED TOTAL SALES AT RS. 2,31,69,458/ - AND AFTER DEBITING EXPENSES AND INTEREST ON CAPITAL TO THE TUNE OF RS. 3,03,330/ - AND REMUNERATION AT RS. 2,97,600/ - , THE NET PROFIT HAS BEEN ARRIVED AT RS. 48,948/ - . THE ASSESSEE HAS PRODUCED PURCHASE AND SALES REGISTER, CASH BOOK AND VOUCHERS IN SUPPORT OF EXPENSES . THE ASSESSEE PURCHASED FROM THE FARMERS OF DIFFERENT PARTS OF ANDHRA PRADESH AND PRODUCED THE VOUCHERS WHICH WERE UNABLE TO VERIFY . THEREFORE , THE ASSESSING OFFICER REJECTED THE BOOK RESULTS AND ESTIMATED THE GROSS PROFIT @ 8% ON THE SALES. 4 . MATTER WAS CARRIED TO THE LD. CIT(A) AND THE LD. CIT(A) HAS DISMISSED THE APPEAL. 5. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PARTIES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT THE ASSESSEE FIRM IS A WHOLESALE DEALER DEALS IN PERISHABLE GOODS AND SINCE THE BUSINESS IS SEASONABLE, PURCHASES ARE MADE FROM FARMERS DIRECTLY . IN THOSE CIRCUMSTANCES, THE ASSESSEE PREPARED SELF MADE VOUCHERS AND TOOK 3 ACKNOWLEDGMENTS FROM THE FARMERS. THE ASSESSEE HAS SUBMITTED THE BILLS AND VOUCHERS BEFORE THE ASSESSING OFFICER BESIDES THAT THE ASSESSEE HAS SUBMITTED BOOKS OF ACCOUNTS, STOCK REGISTER ALONG WITH POSTAL ADDRESSES OF THE CREDITORS FOR VERIFICATI ON. WE FIND THAT THE ASSESSEE HAS SUBMITTED ALL THE DETAILS, BUT THE ASSESSING OFFICER WAS NOT SATISFIED WITH THE CORRECTNESS OF THE BOOK RESULTS. WE UPHELD THE ACTION OF THE ASSESSING OFFICER AS WELL AS LD. CIT(A) FOR REJECTING THE BOOK RESULTS, BUT THE ASSESSING OFFICER HAS ESTIMATED THE GROSS PROFIT @8% IS ON HIGHER SIDE, THEREFORE WE ESTIMATE IT @ 7%. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS PART L Y ALLOWED. ( ORDER PRONOUNCED IN THE OPEN COURT ON 0 4 T H FEBRUARY , 201 5 ). S D / - S D / - (P.K. BANSAL) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 0 4 T H FEBRUARY , 201 5 . VR/ - COPY TO: 1 . THE APPELLANT 2 . THE RESPONDENT 3 . THE LD. CIT 4 . THE CIT(A) 5 . THE D.R 6 . GUARD FILE. BY ORDER ASSISTANT REGISTRAR I.T.A.T., CUTTACK.