M/s S.K. Mishra & Sons, Ranchi V. ITO, Ranchi

ITA 50/RAN/2015

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0353 (ITAT-RANCHI)
• Duration Of Justice: 7 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 20-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHAUDHARY ORAON
• Assessee Lawyers: S K PODDAR; M K CHOUDHARY

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL: CIRCUIT BENCH : RANCHI [BEFORE HONBLE S/SHRI N. S. SAINI, AM AND GEORGE M ATHAN, JM] ITA NO. 50/RAN/2015 ASSESSMENT YEAR: 2005-06 M/S. S. K. MISHRA & SONS, L. N. MISHRA COLONY, ITKI ROAD, RANCHI 834005, JHARKHAND PAN: AASFS6163L VS THE INCOME TAX OFFICER, WARD -3 (1), RANCHI (APPELLANT) (RESPONDENT) APPELLANT BY S/SHRI S. K. PODDAR AND M. K. CHOUDHARY, ADVOCATE RESPONDENT BY SHRI CHAUDHARY ORAON, DR DATE OF HEARING: 28-10-2015 DATE OF PRONOUNCEMENT: 28-10-2015 O R D E R PER GEORGE MATHAN, JM: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(A), RANCHI IN APPEAL NO.311/RAN/OTH/07- 08 DATED 10.12.2014, FOR THE ASSESSMENT YEAR.2005-06. 2. SHRI S.K. PODDAR, ADVOCATE REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI CHOUDHARY ORAON, DR REPRESENTED O N BEHALF OF REVENUE. 3. IT WAS A SUBMISSION THAT THE ASSESSEE IS A PARTN ERSHIP FIRM AND IS DOING CIVIL CONTRACT. THE AO HAS REJECTED THE BO OKS OF ACCOUNTS AND ESTIMATED NET PROFIT AT 8% OF THE GROSS TURNOVER. I T WAS A SUBMISSION THAT ON APPEAL, THE LEARNED CIT(A) HAS DISMISSED TH E APPEAL OF THE ASSESSEE. IT WAS ALSO A SUBMISSION THAT THE ASSESSE E HAD DISCLOSED NET PROFIT OF 6.5% DURING RELEVANT ASSESSMENT YEAR AND IN EARLIER YEAR; ITA NO.50/RAN/2015 (AYS 2005-06) 2 PROFIT RATE WAS SHOWN BETWEEN 4% TO 7%. IT WAS A SU BMISSION THAT THE AO HAD NOT FOLLOWED ANY SCIENTIFIC METHOD TO DE TERMINE ASSSESSEES NET PROFIT. IT WAS FURTHER SUBMITTED TH AT THE AO WAS NOT JUSTIFIED IN ESTIMATING THE NET PROFIT AT 8% OF THE GROSS RECEIPT. IT WAS SUBMITTED THAT THE LEARNED CIT(A), HAD ALSO NOT APP LIED ANY COMPARATIVE CASE WHILE CONFIRMING THE NET PROFIT AS ESTIMATED BY THE AO, HENCE, CONFIRMATION OF THE SAME BY THE LEARNED CIT(A) IS LIABLE TO BE DELETED. 4. IN REPLY THE LEARNED DR SUBMITTED THAT THE BOOKS OF ACCOUNT HAVE BEEN REJECTED AND ADDITION IS LIABLE TO BE MAD E. HE, SUPPORTED THE ORDERS OF THE AO AND THE LEARNED CIT(A). 5. WE HAVE CONSIDERED RIVALS SUBMISSIONS. A PERUSAL OF THE ASSESSMENT ORDER AND ALSO THE ORDER OF THE LEARNED CIT(A) ELABORATELY SHOWS THAT THE ESTIMATION OF THE NET PROFIT OF THE ASSESSEE HAS BEEN DONE ON AD-HOC MANNER WITHOUT TAKING INTO CONSIDERATION ANY COMPARATIVE CASE AND THE EARLIER YEARS DETAILS. IN THE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ESTIMATION OF NET PROFI T AS DONE BY THE AO AND AS CONFIRMED BY THE LEARNED CIT(A) AT 8% IS NOT SUSTAINABLE. IN THE CIRCUMSTANCES, THE ADDITION STAND DELETED. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED. THE ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE C LOSE OF HEARING ON 28-10-2015. SD/- SD/- (N.S. SAINI) ACCOUNTANT MEMBER (GEORGE MATHAN) JUDICIAL MEMBER DATE : 28.10.15 ITA NO.50/RAN/2015 (AYS 2005-06) 3 COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) - 5. THE DR, ITAT, RANCHI 6. GUARD FILE BY ORDER DATE INITIAL ORIGINAL DICTATION PAD & DRAFT ARE ENCLOSED IN THE FILE 1. DRAFT DICTATED ON SR.PS 2. DRAFT PLACED BEFORE AUTHOR SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. DATE OF PRONOUNCEMENT SR.PS 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER