ITO- 1(4), Rudrapur V. Jai Mahalaxmi Traders, Udham Singh Nagar

ITA 466/DEL/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 2441 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-11-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2013-2014
• Appeal Filed On: 18-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Keywords: Rejection of books of accounts
• Section: 145; 144

Judgement Text

ITA NO. 466/DEL/2018 A.Y. 2013-14 JAI MAHALAXMI TRADERS 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: F, NEW DELHI BEFORE SMT. BEENA A PILLAI, JUDICIAL ME MBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBE R ITA NO. 466/DEL/2018 AY: 2013-14 ITO WARD 1(4) RUDRAPUR VS . JAI MAHALAXMI TRADERS BAGWARA, MANDI SAMITI PARISAR, KICHHA ROAD, UDHAM SINGH NAGAR, UTTARAKHAND. AAIFJ1460B (APPELLANT) (RESPONDE NT) REVENUE BY : SH. SURENDER PAL, SR. DR ASSESSEE BY : NONE DATE OF HEARING : 06/11/2018 DATE OF PRONOUNCEMENT : 14/11/2018 ORDER PER BEENA A PILLAI, JUDICIAL MEMBER PRESENT APPEAL HAS BEEN FILED BY REVENUE AGAINST OR DER DATED 16/10/17 PASSED BY LD. CIT (A) HALDWANI FOR A SSESSMENT YEAR 2013-14 ON FOLLOWING GROUNDS OF APPEAL: 1. THAT THE UNDERSIGNED EXAMINED THE BOOKS OF ACCOUNT S DURING THE REMAND PROCEEDINGS AND SUBMITTED REMAND REPORT STATING THAT THE ASSESSEE COULD NOT PRODUCE COMPLETE BILLS AND VOUCHERS, TRADING RESULTS DECLAR ED BY THE ASSESSEE WERE NOT VERIFIABLE AND LD. CIT(A) HAS NOT CONSIDERED THE WHOLE REMAND AND ACCEPTED THE PART O F THE REMAND REPORT. THEREFORE, THE LD. CIT(A) HAS ERRED IN THE EYES OF LAW IN DELETING THE ADDITION TO THE TUNE OF RS. 68,65,399/-. ITA NO. 466/DEL/2018 A.Y. 2013-14 JAI MAHALAXMI TRADERS 2 2. THAT THE APPELLANT CRAVES, LEAVES TO ADD, ALTER, AM END OR VARY FROM THE ABOVE GROUNDS OF APPEAL. 2. BRIEF FACTS OF THE CASE ARE AS UNDER : ASSESSEE FILED ITS RETURN OF INCOME ON 01/10/13 IS DECLARING TOTAL INCOME OF RS. 1,17,950/-. THE CASE WAS SELECTED FO R SCRUTINY AND NOTICE UNDER SECTION 143 (2) OF THE ACT WAS ISSUED. IN RESPONSE TO STATUTORY NOTICES, REPRESENTATIVE OF ASSESSEE APPEA RED BEFORE LD. AO AND FILED REQUISITE DETAILS AS CALLED FOR. 2.1 LD. AO OBSERVED THAT ASSESSEE IS ENGAGED IN BUS INESS OF TRADING OF WHEAT, MADUA RAGI, MAIZE, SOYABEAN AND B RAN. LD. AO DURING COURSE OF ASSESSMENT PROCEEDINGS CALLED FOR LEDGER, CASHBOOK, WATCHERS ETC. FOR VERIFICATION OF TRADING RESULT. IT HAS BEEN OBSERVED BY LD. AO THAT AMPLE OPPORTUNITIES WE RE PROVIDED, AND ASSESSEE COULD NOT PRODUCE DOCUMENTS TO SATISFA CTION OF LD. AO. LD. AO REJECTED BOOKS OF ACCOUNTS AS PER PROVI SIONS OF SECTION 145 (3) OF THE ACT AND COMPLETED ASSESSMENT UNDER SECTION 144 OF ACT. LD.AO OBSERVED THAT ASSESSEE HA S SHOWN TOTAL TURNOVER OF RS.36,41,67,314/- FROM HIS TRADING BUSI NESS. IN THE ABSENCE OF VERIFICATION OF BOOKS OF ACCOUNTS HE EST IMATED RATE OF NET PROFITS OF TURNOVER AND APPLIED 2%. HE, THUS, COMPUTED AN ADDITIONAL PROFIT OF RS.71,65,399/- AND ADDED IT IN THE HANDS OF ASSESSEE. 2.2 AGGRIEVED BY ORDER OF LD.AO, ASSESSEE PREFERRED APPEAL BEFORE LD.CIT (A), WHO DELETED THE ADDITION. 2.3 AGGRIEVED BY ORDER OF LD. CIT (A) REVENUE IS IN APPEAL BEFORE US NOW. ITA NO. 466/DEL/2018 A.Y. 2013-14 JAI MAHALAXMI TRADERS 3 3. NONE HAS APPEARED ON BEHALF OF ASSESSEE BEFORE U S TODAY. CONSIDERING SMALLNESS OF CASE, WE DO NOT DEEM IT FI T TO KEEP IT PENDING. WE ARE, THEREFORE, INCLINED TO DISPOSE OF THIS APPEAL BASED UPON DOCUMENTS AVAILABLE WITH US ON RECORD, E X PARTE ASSESSEE. 4. LD. SR. DR PLACED RELIANCE UPON THE ORDER OF LD. AO. 5. WE HAVE GONE THROUGH ORDER PASSED BY AUTHORITIES BELOW. 6. ON PERUSAL OF ORDER PASSED BY LD. CIT (A), IT IS OBSERVED THAT ASSESSEE HAD ALLEGED OF NOT HAVING RECEIVED SUFFICI ENT OPPORTUNITY TO PRODUCE BOOKS OF ACCOUNTS DURING ASSESSMENT PROC EEDINGS. ASSESSEE HAS ACCORDINGLY FILED VARIOUS DETAILS WHIC H WAS SENT TO LD.AO FOR REMAND REPORT. LD.CIT (A) RECEIVED REMAND REPORT FROM ASSESSING OFFICER ON 10/10/17. 7. THE ISSUE THAT ARISES IS IN RESPECT OF REJECTION OF BOOKS OF ACCOUNT AND ESTIMATION OF NET PROFIT OF ASSESSEE AT 2% BY LD.AO. IT IS OBSERVED BY LD.CIT (A) THAT LD.AO HAS MADE AD DITION ON THE GROUND OF NON-PRODUCTION OF BOOKS OF ACCOUNT DURING COURSE OF ASSESSMENT PROCEEDINGS BECAUSE OF WHICH TRADING RES ULTS COULD NOT BE VERIFIED. LD.AO, THEREAFTER, DURING REMAND P ROCEEDINGS ON PERUSAL OF VARIOUS DETAILS FILED BY ASSESSEE OBSERV ED THAT ASSESSEE HAD DONE TRADING THROUGH MANDI SAMITI. LD. AO THERE AFTER WRITTEN LETTERS TO MANDI SAMITI, WHO HAS CONFIRMED SUBMISSIONS ADVANCED BY ASSESSEE. LD.CIT (A), THUS, OBSERVED T HAT TRADING RESULTS DECLARED BY ASSESSEE WERE PRIMA FACIE VERIF IABLE. LD. CIT (A) FURTHER OBSERVED THAT ASSESSEE HAS MAINTAINED I TS ACCOUNT IN VIEW OF INCREASING ITS TURNOVER THE NET PROFIT DECL ARED IN YEAR ITA NO. 466/DEL/2018 A.Y. 2013-14 JAI MAHALAXMI TRADERS 4 UNDER CONSIDERATION WAS AT .16% AS AGAINST .2% IN E ARLIER YEAR. HE, THUS, HELD THAT REJECTION OF BOOKS OF ACCOUNTS BY LD. AO WAS UNJUSTIFIABLE. 8. LD. CIT (A) FURTHER OBSERVES FROM REMAND REPORT OF LD. AO THAT APPELLANT COULD NOT PRODUCE BILLS SUPPORTING T HE BARDANA EXPENSES, LOADING AND UNLOADING CHARGES WHICH WAS E STIMATED AT RS. 3 LACS. LD. CIT (A) THUS, UPHELD DISALLOWANCE T O EXTENT OF RS. 3 LACS. 9. WE DO NOT FIND ANY INFIRMITY IN THE OBSERVATIONS OF LD. CIT (A) WHICH IS SUPPORTED BY PRIMA FACIE ACCEPTANCE OF THE BOOKS BY LD.AO DURING REMAND PROCEEDINGS. NO FAULT HAS BEEN POINTED BY LD. AO IN THE DETAILS FILED BY ASSESSEE DURING REMA ND PROCEEDINGS. ACCORDINGLY, WE UPHOLD ORDER OF LD. CI T (A) AND DISMISS THE GROUND RAISED BY REVENUE. IN THE RESULT APPEAL FILED BY REVENUE STANDS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 14/11/2018 SD/- SD/- (PRASHANT MAHARISHI) (BEENA A PILLAI) ACCOUNTANT MEMBER JU DICIAL MEMBER DT. 14 TH NOVEMBER,2018 *KAVITA ARORA ITA NO. 466/DEL/2018 A.Y. 2013-14 JAI MAHALAXMI TRADERS 5 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT - TRUE COPY - BY ORDER, ASSISTANT REGISTRAR ITAT DELHI BENCHES DATE DRAFT DICTATED ON 13.11.2018 DRAFT PLACED BEFORE AUTHOR 13.11.2018 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. APPROVED DRAFT COMES TO THE SR.PS/PS 14.11.18 KEPT FOR PRONOUNCEMENT ON & ORDER UPLOADED ON : 14.11.18 FILE SENT TO THE BENCH CLERK 14.11.18 DATE ON WHICH FILE GOES TO THE AR DATE ON WHICH FILE GOES TO THE HEAD CLERK. DATE OF DISPATCH OF ORDER.