Anita Garg Prop. M/s. Novelty Trading Company , Hapur V. ITO, Ward- 3(4), Hapur

ITA 5229/DEL/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2315 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 03-08-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PRAKASH DUBEY
• Keywords: Rejection of books of accounts; Transfer pricing; Set aside
• Section: 143(3); 250; 145

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A : NEW DELHI) (THROUGH VIDEO CONFERENCE ) BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER, AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO.5229/DEL./2018 (ASSESSMENT YEAR : 2014-15) ANITA GARG. V S. INCOME TAX OFFICER, M/S. NOVELTY TRADING COMPANY WARD- 3(4), HAPUR 303, SHIVAJI NAGAR, PILKHUWA, DISTT.- HAPUR (PAN : AAYPG2767Q) (APPELLANT) ( RESPONDENT) ASSESSEE BY : SHRI ALOK GUPTA, CA REVENUE BY : SHRI PRAKASH DUBEY, SR.DR DATE OF HEARING : 25.05.2021 DATE OF ORDER : 24 .06.202 1 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER APPELLANT, SMT. ANITA GARG PROP. M/S. NOVELTY TRAD ING COMPANY (HEREINAFTER REFERRED TO AS ASSESSEE) B Y FILING THE PRESENT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 23.05.2018 PASSED BY THE COMMISSIONER OF INCOME-TA X (APPEALS) , ITA NO.5229/DEL/2018 2 MUZAFFRNAGAR QUA THE ASSESSMENT YEAR 2014-15 ON THE GROUNDS INTER ALIA THAT :- GROUND NO. 1 THAT ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE ORDER PASSED BY LD. CIT (A) U/S 250 IS BAD IN LAW. GROUND NO. 2 THAT LD. CIT (A) HAS ERRED IN CONFIRMING THE O RDER PASSED BY THE LD. AO UNDER SECTION 143(3) OF THE INCOME-TAX ACT, AND THE REBY ERRED IN CONFIRMING THE ARBITRARY ADDITIONS OF RS. 48,74,385/- MADE, WI THOUT ANY CONCRETE EVIDENCES, BY THE LD. AO. GROUND NO. 3 THAT THE LD. CIT (A) HAS ERRED IN CONFIRMING T HE CAPRICIOUS NET PROFIT RATE OF 2 PER CENT APPLIED ON THE TOTAL TURNOVER BY THE LD.AO WITHOUT CONSIDERING THE MARGINS EARNED BY THE ASSESSEE IN HIS OWN CASES . GROUND NO. 4 THAT THE LD. CIT(A) HAS ERRED IN NOT DISCUSSI NG OR DISTINGUISHING THE CASE LAWS RELIED BY THE ASSESSEE, THEREBY ERRED IN PASSI NG THE NON-SPEAKING ORDER WITHOUT CONSIDERING THE JUDICIAL PRECEDENTS DELIVER ED BY VARIOUS COURTS UNDER THE SIMILAR FACTS AND CIRCUMSTANCES AS GIVEN IN THE PRESENT CASE. GROUND NO. 5 THAT THE APPELLANT CRAVES TO LEAVE TO ADD / A LTER ANY / ALL GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING OF THE APPEAL 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : ASSESSING OFFICER AFTER R EJECTING THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE U/S 14 5 OF THE ACT PROCEEDED TO APPLY THE NET PROFIT OF 2% ON THE TOTA L TURN OVER OF RS. 26,65,92,371/- RESULTING INTO INCOME OF RS. 53,31,8 47/- UNDER THE HEAD INCOME FROM PROFESSION & BUSINESS AND THEREB Y MADE A ADDITION OF RS. 48,74,385/-. 3. ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) BY WAY OF FILING APPEAL WHO HAS CONFIRMED THE ADDITION BY DIS MISSING THE ITA NO.5229/DEL/2018 3 APPEAL. FEELING AGGRIEVED THE ASSESSEE HAS COME UP BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT APPEAL. 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 5. UNDISPUTEDLY, ASSESSEE HAS FAILED TO ANSWER THE QUERIES RAISED BY THE ASSESSING OFFICER DURING ASSESSMENT P ROCEEDINGS QUA THE ENTRIES RECORDED INTO THE BOOKS OF ACCOUNTS. IT IS ALSO NOT IN DISPUTE THAT ASSESSEE HAS FAILED TO FURNISH THE BIL LS OF PURCHASES FROM RELATED PARTY AND BILLS QUA SIMILAR ITEMS PROC URED FROM UN- RELATED PARTY TO PROVE THAT THE PURCHASES MADE ARE AT ARMS LENGTH PRICE. IT IS ALSO NOT IN DISPUTE THAT NEITHER DURIN G THE FIRST APPELLATE PROCEEDINGS NOR BEFORE THE TRIBUNAL, ASSESSEE HAS O PTED TO PRODUCE AND PROVE THE BOOKS OF ACCOUNTS REJECTED BY THE AO. 6. IN THE BACKDROP OF THE AFORESAID FACTS AND CIRCU MSTANCES OF THE CASE WE ARE OF THE CONSIDERED VIEW THAT KEEPING IN VIEW THE CONDUCT OF THE ASSESSEE IN WITHHOLDING THE DOCUMENT S NOR HE HAS PROVED THE BOOKS OF ACCOUNTS; THAT THE FACT THAT HE IS NOT NEW IN THE BUSINESS, AND HAS TURN-OVER OF RS.26,65,92,371/- DU RING THE YEAR UNDER CONSIDERATION, THE BEST ASSESSMENT JUDGMENT W AS THE ONLY ITA NO.5229/DEL/2018 4 OPTION WITH THE REVENUE AUTHORITIES, WE ARE OF THE CONSIDERED VIEW THAT NET PROFIT @ 1.5% NEEDS TO BE APPLIED TO REACH AT THE LOGICAL CONCLUSION TO THE TOTAL TURN-OVER OF RS. 26,65,92,3 71/-. CONSEQUENTLY APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 24 TH JUNE, 2021 SD/- SD/- (PRASHANT MAHARISHI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: THE 24 TH JUNE, 2021 *BINITA* COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A) 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI