Sri Allu Srinu, Srikakulam V. The ITO, Srikakulam

ITA 417/VIZ/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8954 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 6 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-05-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 10-10-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M K SETHI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM SMC BENCH, VISAKHAPATNAM BEFORE SHRI D. MANMOHAN, HONBLE VICE-PRESIDENT ITA NO. 417/VIZ/2016 (ASST. YEAR : 2011-12) SRI ALLU SRINU, S/O CHINNA APPALA NAIDU, VANDRANGI VILLAGE, G. SIGADAM, SRIKAKULAM DISTRICT. VS. ITO, WARD-1, SRIKAKULAM. PAN NO. ATMPA 9246 K (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE. DEPARTMENT BY : SHRI M.K. SETHI SR. DR DATE OF HEARING : 03/05/2017. DATE OF PRONOUNCEMENT : 03/05/2017. O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. CIT(A)-2, GUNTUR AND IT PERTAINS TO ASSESSMENT YEAR 2011-12. 2. THOUGH NOTICE WAS SENT TO THE ASSESSEE BY RPAD, THE SAME WAS RETURNED BY THE POSTAL DEPARTMENT WITH THE REMARKS THAT THERE IS NO SUCH PERSON AVAILABLE AT THE SAID ADDRESS, THE ASSESSEE DID NOT CHOSE TO FURNISH CORRECT ADDRESS TO THE REGISTRY. UNDER THESE FACTS AND CIRCUMSTANCES OF THE CASE, I HAVE NO OTHER ALTERNATIVE EXCEPT TO DISPOSE OF THE APPEAL EXPARTE , QUA THE ASSESSEE. 2 ITA NO. 417/VIZ/2016 (ALLU SRINU) 3. I HAVE CONSIDERED THE SUBMISSIONS OF DEPARTMENTAL REPRESENTATIVE IN THIS REGARD AND CAREFULLY PERUSED THE RECORD. 4. THE ASSESSEE RAISED AS MANY AS 05 GROUNDS OF APPEAL, WHICH CAN BE DIVIDED INTO TWO ISSUES I.E. ESTIMATION OF INCOME FROM IMFL AND THE CORRECTNESS OF THE ADDITIONS MADE, REFERABLE TO UNEXPLAINED LOANS TAKEN BY THE ASSESSEE. 5. AS REGARDS THE FIRST ISSUE, IT IS NOT IN DISPUTE THAT THE ASSESSEE CARRIED ON BUSINESS OF PURCHASE AND SALE OF IMFL WITHIN THE ZONE OF SRIKAKULAM. THE ASSESSEE PURCHASED LIQUOR VALUED AT 94,95,035/- AND ADMITTED SALES OF 1,33,68,850/-. HE DECLARED INCOME OF 2,75,410/-, WHEREAS THE ASSESSING OFFICER ESTIMATED THE NET PROFIT AT 20% OF THE STOCK. 6. LEARNED DEPARTMENTAL REPRESENTATIVE HAS NOT DISPUTED THAT THE FACTS AND CIRCUMSTANCES IN THE INSTANT CASE ARE IDENTICAL TO THE CASE OF SRI PANDAVA RAMA RAO (ITA NO. 118/VIZ/2015). CONSISTENT WITH THE VIEW TAKEN THEREIN, I HOLD THAT ESTIMATE OF NET PROFIT AT 5%, CLEAR OF ALL DEDUCTIONS, AS AGAINST THE ESTIMATE OF 10% MADE BY THE LD. CIT(A) WOULD MEET THE ENDS OF JUSTICE AND I DIRECT THE ASSESSING OFFICER ACCORDINGLY. 7. WITH REGARD TO SOURCE OF CREDIT, THE ASSESSING OFFICER OBSERVED THAT THERE WAS A FRESH CREDIT OF 11,14,466/-. THE ASSESSEE CLAIMED THAT HE RECEIVED ADVANCES FROM PROSPECTIVE BUYERS. THE ASSESSING OFFICER REJECTED THE EXPLANATION ON THE GROUND THAT THE ASSESSEE HAS 3 ITA NO. 417/VIZ/2016 (ALLU SRINU) STARTED THIS BUSINESS FOR THE FIRST TIME AND IN THIS LINE OF BUSINESS, STOCK HAS TO BE BOOKED IN ADVANCE. THE ASSESSEE HIMSELF COULD NOT QUANTIFY THE AMOUNT OF ADVANCE RECEIVED AND THE NUMBER OF PERSONS FROM WHOM THE AMOUNT WAS RECEIVED. HE, THEREFORE, MADE AN ADDITION OF 11,14,466/- UNDER THE HEAD INCOME FROM OTHER SOURCES. MORE OR LESS ON SIMILAR GROUNDS, THE ASSESSING OFFICER MADE ADDITION OF 1,10,000/- AND 96,710/-, MORE PARTICULARLY FOR WANT OF DETAILS. 8. BEFORE THE LD. CIT(A), ASSESSEE FURNISHED SOME ADDITIONAL MATERIAL IN THE FORM OF CONFIRMATION LETTERS AND THE LD. CIT(A) CALLED FOR THE REMAND REPORT AND UPON APPRECIATION OF THE FACTS AND CIRCUMSTANCES, HE AFFIRMED THE ACTION OF THE ASSESSING OFFICER. 9. FURTHER AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. NO MATERIAL WHATSOEVER WAS FILED BEFORE THE TRIBUNAL TO CONTRADICT THE FINDINGS OF THE LD. CIT(A). UNDER THESE CIRCUMSTANCES, I DO NOT FIND ANY INFIRMITY IN THE ORDER PASSED BY THE LD. CIT(A) AND, THEREFORE, I REJECT GROUND NOS. 3 TO 5. 10. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED ACCORDINGLY IN THE OPEN COURT TODAY I.E. 03 RD DAY OF MAY, 2017. SD/- (D. MANMOHAN) VICE-PRESIDENT DATED : 03 RD MAY, 2017. VR/- 4 ITA NO. 417/VIZ/2016 (ALLU SRINU) COPY TO: 1. THE ASSESSEE SRI ALLU SRINU, S/O CHINNA APPALA NAIDU, VANDRANGI VILLAGE, G. SIGADAM, SRIKAKULAM DISTRICT. 2. THE REVENUE ITO, WARD-1, SRIKAKULAM. 3. THE PCIT-2, VISAKHAPATNAM. 4. THE CIT(A)-2, VISAKHAPATNAM. 5. THE D.R., VISAKHAPATNAM. 6. GUARD FILE. BY ORDER