ITO, Jaipur V. SHRI RAJESH BHARGAVA, Jaipur

ITA 585/JPR/2011

• Counselvise Citation: 58523114 RSA 2011
• Duration Of Justice: 3 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-04-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 10-06-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MRS NEENA JEPH
• Keywords: Principle of natural justice
• Section: 143(3); 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH VH-VKJ-EHUK] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM VK;DJ VIHY LA- @ ITA NO. 585/JP/2011 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2005-06 INCOME TAX OFFICER, WARD 6(2), JAIPUR. CUKE VS. RAJESH BHARGAVA, B-85, GANESH MARG, BAPU NAGAR, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ L A-@ PAN/GIR NO.: ABFPB 2369 F VIHYKFKHZ @ APPELLANT IZR;FKHZ @ RESPONDENT JKTLO DH VKSJ LS @ REVENUE BY : MRS. NEENA JEPH (JCIT) FU/KZKFJRH DH VKSJ LS @ ASSESSEE BY : SHRI P.C. PARWAL (C.A.) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 23/03/2015 ?KKS'K .KK DH RKJH[ K @ DATE OF PRONOUNCEMENT : 10/04/2015 VKNS'K @ ORDER PER: T.R. MEENA, A.M. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 30/03/2011 PASSED BY THE LEARNED CIT(A)-II, JAIPUR FOR A.Y. 2005-06. THE SOLE GROUND OF APPEAL IS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (APPEALS) HAS ERRED IN RESTRICTING TH E TRADING ADDITION OF RS. 18,00,300/- MADE BY THE A.O . TO RS. 50,000/- ONLY WITHOUT APPRECIATING THE FACT THAT THE ITA 585/JP/2011_ ITO VS. RAJESH BHARGAVA 2 ASSESSEE DID NOT PRODUCE BOOKS OF ACCOUNTS BEFORE A .O. EITHER DURING THE COURSE OF ASSESSMENT PROCEEDINGS OR DURING THE COURSE OF SENDING REMAND REPORT BY THE A .O. 2. THE SOLE GROUND OF APPEAL IS AGAINST DELETING THE TRADING ADDITION MADE BY THE ASSESSING OFFICER FROM RS. 18,00,300/- TO RS. 50,000/-. THE LD. ASSESSING OFFICER OBSERVED THAT THE ASSESSEE IS AN OPTICIAN AND ENGAGED IN TRADING OF OPTICS, FRAMES, LENSES ETC. T HE ASSESSEE FILED ITS RETURN OF INCOME ON 31/10/2006 DECLARING INCOME OF RS. 1,58,950/-. THE CASE WAS SCRUTINIZED U/S 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). THE LD. ASSESSING OFFICER HAD PROVID ED NUMBER OF OPPORTUNITIES TO PRODUCE THE BOOKS OF ACCOUNT VIZ L EDGER AND OTHER DETAILED INFORMATION ON VARIOUS DATES BUT WHICH HAS NOT BEEN COMPLIED BY THE ASSESSEE. THE ASSESSEES ATTITUDE WAS FOUND N OT-COOPERATIVE WITH THE DEPARTMENT. THEREFORE, HE DECIDED THE ASSESS EES CASE U/S 144 OF THE ACT. DURING THE PREVIOUS YEAR AGAINST THE G ROSS TURNOVER OF RS. 97,48,503/-, THE ASSESSEE HAS DECLARED GROSS PROFIT OF RS. 19,49,700/-, WHICH GIVES G.P. RATE @ 20%. THE LD ASSESSING OFFICER GAVE SHOW CAUSE NOTICE VIDE LETTER DATED 15/11/2007 TO PRODUCE THE BOOKS OF ACCOUNT, DAY TO DAY STOCK REGISTER, SALE AND PURCHASE BILL A ND OTHER RECORDS IN ORDER TO VERIFY THE RESULT DECLARED BY HIM, WHICH WER E NOT PRODUCED BY HIM. THEREFORE, HE PROPOSED TO SELL AS WELL AS GROSS PROFIT SHOULD NOT BE ITA 585/JP/2011_ ITO VS. RAJESH BHARGAVA 3 ESTIMATED U/S 144 OF THE ACT. THE ASSESSEES EXPENSE S IN ABSENCE OF NON-PRODUCTION OF COMPLETE BOOKS HAD NOT VERIFIED B Y THE ASSESSING OFFICER. THE ASSESSEE HAS SHOWN UNSECURED LOAN DURING THE YEAR AT RS. 16,53,000/- FOR WHICH NO CONFIRMATION WAS FILED BY HI M. THE LD ASSESSING OFFICER ESTIMATED THE TURNOVER AT RS. 1,2 5,00,000/- AS AGAINST THE SALE BUSINESS AT RS. 97,48,503/- AND APPLIED G. P. RATE OF 30%. THUS HE MADE THE ADDITION IN TRADING RESULT AT RS.18,00, 300/-. THE OTHER DISALLOWANCES FROM THE EXPENSES AS WELL AS ALL THE LO AN CREDITORS WERE ADDED IN THE INCOME OF THE ASSESSEE. 3. BEING AGGRIEVED BY THE ORDER OF THE ASSESSING OF FICER, THE ASSESSEE CHALLENGED THE ADDITIONS UNDER THREE HEAD BEFORE THE LEARNED CIT(A), WHO HAD HELD JUSTIFIED THAT THE LD ASSESSING OFFICER RIGHTLY APPLIED SECTION 145(3) OF THE ACT IN ABSENCE OF NON -PRODUCTION OF COMPLETE BOOKS OF ACCOUNT BUT HE ACCEPTED THE ASSES SEES TURNOVER AS DECLARED BY HIM. FINALLY, HE CONFIRMED THE ADDITION OF RS. 50,000/- AS AGAINST THE ADDITION MADE BY THE ASSESSING OFFICER AT RS. 18,00,300/-. HE ALSO RELIED UPON THE VARIOUS CASE LAWS MENTIONED ON PAGE 5 OF THE ITS ORDER. ITA 585/JP/2011_ ITO VS. RAJESH BHARGAVA 4 4. NOW THE REVENUE IS IN APPEAL BEFORE US. THE LEARNE D D.R. ARGUED THAT THE ASSESSEE HAD NOT PRODUCED THE COMPLETE BOO KS OF ACCOUNT BEFORE THE ASSESSING OFFICER AND SUBMISSIONS MADE B Y THE AR BEFORE THE LD CIT(A) VIDE LETTER DATED 15/12/2008 AND OTHER VARIOUS SUBMISSIONS HAD BEEN ACCEPTED WITHOUT TAKING ANY REM AND REPORT FROM THE ASSESSING OFFICER. THE LD. CIT(A) ALSO ACCEPTED THE RETURNED SALES FIGURES WITHOUT ANY BASIS. THEREFORE, MATTER MAY BE S ENT BACK TO THE ASSESSING OFFICER TO VERIFY THE FACTS OF THE CASE. 5. AT THE OUTSET, THE LEARNED A.R. FOR THE ASSESSEE REITERATED THE ARGUMENTS MADE BEFORE THE LD. CIT(A) AND ARGUED THA T HE HAS GIVEN REASONED ORDER AFTER CONSIDERING THE LEGAL POSITION ON ESTIMATION OF INCOME. THEREFORE, THE SAME MAY BE CONFIRMED. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE ASSESSEE HAS NOT PRODUCED THE COMPLETE BOOKS OF ACCOUNT BEFORE THE ASSESSING OFFI CER, THEREFORE, THERE WAS NO CHOICE BEFORE HIM TO PASS THE ORDER U/S 144 OF THE ACT AND ESTIMATION OF INCOME. THE LD. CIT(A) HAD CONSIDER ED THE ASSESSEES SUBMISSIONS WHICH HAS NOT BEEN REMANDED TO THE ASSES SING OFFICER FOR HIS COMMENT BEFORE DECIDING THE CASE. THEREFORE, IT IS COMPLETE ITA 585/JP/2011_ ITO VS. RAJESH BHARGAVA 5 VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. THE FIND ING GIVEN BY THE LD CIT(A) FOR CONFIRMATION OF RS. 50,000/- IS WITHOUT AN Y BASIS, THEREFORE WE SET ASIDE THE ORDER TO THE ASSESSING OFFICER AND THE ASSESSEE IS DIRECTED TO PRODUCE ALL THE COMPLETE BOOKS OF ACCOU NT BEFORE THE ASSESSING OFFICER AND COPY OF SUBMISSIONS MADE BEFO RE THE LD CIT(A). ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD CIT(A) ON THIS GROUND TO THE ASSESSING OFFICER. 7. IN THE RESULT, THE REVENUES APPEAL IS ALLOWED FO R STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 10/05/2015. SD/- SD/- VKJ-IH-RKSYKUH VH-VKJ-EHUK (R.P.TOLANI) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ @ JAIPUR FNUKAD @ DATED 10 TH APRIL, 2015 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE ITO, WARD 6(2), JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- SHRI RAJESH BHARGAVA, JAIPUR. 3. VK;DJ VK;QDR @ CIT ITA 585/JP/2011_ ITO VS. RAJESH BHARGAVA 6 4. VK;DJ VK;QDR @ VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 585/JP/2011). VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR