ADDL CIT 19(3), MUMBAI V. LATA V VASUDEVA, MUMBAI

ITA 6422/MUM/2012

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9684 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 9 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 13-02-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 19-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V JUSTIN
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD , JUDICIAL MEMBER ITA NO. 6422/MUM/2012 : A.Y : 2009 - 10 ACIT - 19(3), MUMBAI (APPELLANT) VS. SMT. LATA V. VASUDEVA 624, LAXMI PLAZA, LAXMI INDUSTRIAL ESTATE, ANDHERI (W), MUMBAI 400 053. PAN : AAWPV5235G (RESPONDENT) APPELLANT BY : SHRI V. JUSTIN RESPONDENT BY : SHRI HARESH P. SHAH DATE OF HEARING : 04/07/2017 DATE OF PRONOUNCEMENT : 31 /07/2017 O R D E R PER G.S. PANNU , AM : THE CAPTIONED APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE CIT(A) - 30 , MUMBAI DATED 13.8.2012 , PERTAINING TO THE ASSESSMENT YEAR 2009 - 10 , WHICH IN TURN HAS ARISEN FROM THE ORDER PASSED BY THE ASSESSING OFFICER DATED 13.12.2011 UNDER SECTION 143(3) R.W.S 144 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. IN ITS APPEAL, THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 2 SMT. LATA V. VASUDEVA ITA NO. 6422/MUM/2012 (1) ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) HA S ERRED IN RESTRICTING THE ESTIMATION OF THE NET PROFIT @ 15% AS AGAINST 25% MADE BY THE ASSESSING OFFICER CONSEQUENT TO REJECTION OF BOOKS OF ACCOUNT WITHOUT APPRECIATING THE FACTS THAT HE HIMSELF CONFIRMED THE ACTION OF THE ASSESSING OFFICER IN INVOKING THE PROVISION OF SECTION 145(3) OF THE I.T. ACT AND DOING SO THE ASSESSING OFFICER HAS CORRECTLY ESTIMATED 25% AS NET PROFIT WHICH IS THE NORMAL PROFIT MARGIN IN THE LINE OF ASSESSEE'S BUSINESS. (2) ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) ERRED IN HOLDING THAT ASSESSING OFFICER HAS NOT CITED ANY COMPARABLE CASES FOR ESTIMATING THE PROFIT AT 25% AND THE ASSESSEE HAS FURNISHED ADEQUATE DETAILS WITH REGARD TO SUB CONTRACT PAYMENTS DURING THE COURSE OF ASSESSMENT PROCEED INGS, IGNORING THE FACTS THAT THERE WAS NO BASIC DETAILS WITH REGARDS TO SUB CONTRACT PAYMENTS AND OTHER MAJOR EXPENSES FILED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS, RENDERING THE SAME UNVERIFIABLE. (3) THE APPELLANT PRAYS THAT THE ORDER OF TH E CIT(A) ON THE ABOVE GROUND BE SET SIDE AND THAT OF THE AO BE RESTORED. 3. AS THE GROUNDS OF APPEAL REVEAL, THE SOLITARY GRIEVANCE OF THE REVENUE IS AGAINST THE ACTION OF CIT(A) IN RESTRICTING THE ESTIMATION OF NET PROFIT @ 15% AS AGAINST 25% MADE BY THE ASSESSING OFFICER WHILE DETERMINING THE INCOME OF THE ASSESSEE FROM BUSINESS. 4. IN BRIEF, THE RELEVANT FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND PROPRIETOR OF M/S. OSCAR MARINE SERVICES, WHICH IS ENGAGED IN THE BUSINESS OF TECHNICAL SERVICES C ONSULTANCY. AS PER THE DISCUSSION IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER WAS NOT SATISFIED WITH THE BOOK RESULTS DECLARED BY THE ASSESSEE , AND HE INVOKED SEC.145(3) OF THE ACT AND PROCEEDED TO ESTIMATE THE INCOME FROM BUSINESS. THE ASSESSING OFFI CER ESTIMATED THE NET PROFIT FROM BUSINESS OF THE ASSESSEE @ 25% OF 3 SMT. LATA V. VASUDEVA ITA NO. 6422/MUM/2012 THE TOTAL RECEIPTS OF RS.5,52,43,857/ - , WHICH CAME TO RS.1,38,10,964/ - , AS AGAINST RS.52,90,771/ - SHOWN BY THE ASSESSEE IN HER COMPUTATION OF INCOME. THE AFORESAID ACTION OF THE ASSESSING OFFICER WAS CARRIED IN APPEAL BEFORE THE CIT(A), WHO ESTIMATED THE NET PROFIT @ 15%, THEREBY ALLOWING PART RELIEF TO THE ASSESSEE. THE RELIEF SO ALLOWED BY THE CIT(A) IS IN CHALLENGE BEFORE US BY THE REVENUE. 5. AT THE TIME OF HEARING, THE LEARNED REPRE SENTATIVE FOR THE RESPONDENT - ASSESSEE POINTED OUT THAT THE ASSESSEE HAD ALSO PREFERRED AN APPEAL AGAINST THE ORDER OF CIT(A), WHICH HAS SINCE BEEN DISPOSED OFF BY THE TRIBUNAL VIDE ORDER DATED 2.9.2016. IN HER APPEAL, THE ASSESSEE WAS NOT SATISFIED WITH T HE ESTIMATION MADE BY THE CIT(A) @ 15%. THE LEARNED REPRESENTATIVE REFERRED TO THE DECISION OF THE TRIBUNAL DATED 2.9.2016, WHEREIN THE ESTIMATION MADE BY THE CIT(A) @ 15% HAS BEEN FOUND TO BE ON A HIGHER SIDE AND INSTEAD, THE ASSESSING OFFICER HAS BEEN D IRECTED TO ESTIMATE THE NET PROFIT @ 12%. ON THIS BASIS, THE LEARNED REPRESENTATIVE POINTED OUT THAT THE CAPTIONED APPEAL OF THE REVENUE, THEREFORE, DESERVES TO BE DISMISSED SINCE THE ESTIMATION APPROVED BY THE TRIBUNAL IS @ 12%. 6. THE LD. DR HAS NOT DI SPUTED THE FACTUAL MATRIX BROUGHT OUT BY THE LEARNED REPRESENTATIVE, BUT RELIED ON THE ORDER OF THE ASSESSING OFFICER. 7. HAVING CONSIDERED THE RIVAL SUBMISSIONS, AND IN VIEW OF THE ORDER OF THE TRIBUNAL DATED 2.9.2016 (SUPRA), WE FIND THAT THE ISSUE IN A PPEAL IS NO LONGER RES INTEGRA AS THE TRIBUNAL HAS ALREADY APPROVED THE 4 SMT. LATA V. VASUDEVA ITA NO. 6422/MUM/2012 ESTIMATION OF NET PROFIT @ 12%. THUS, THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE. 8. EVEN OTHERWISE, LOOKED AT FROM ANOTHER ANGLE ALSO, THE IMPUGNED APPEAL OF THE REVENUE IS NOT M AINTAINABLE. NOTABLY, THE LIMITED DISPUTE RAISED BY THE REVENUE IS SCALING DOWN OF ESTIMATION OF NET PROFIT BY THE CIT(A) TO 15% AS AGAINST 25% MADE BY THE ASSESSING OFFICER. CONSIDERING THE AMOUNT OF TAX IN DISPUTE VIS - A - VIS THE SCALING DOWN OF ESTIMATI ON BY THE CIT(A) TO 15%, WE FIND THAT THE SAME WOULD BE BELOW THE LIMIT PRESCRIBED BY THE CBDT IN ITS CIRCULAR NO. 21/2015 DATED 10/12/2015 FOR FILING OF APPEALS BEFORE THE TRIBUNAL. ON THIS GROUND ALSO, THE CAPTIONED APPEAL OF THE REVENUE IS NOT MAINTAIN ABLE. 9. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED, AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 3 1 S T JULY, 2017. SD/ - SD/ - (RAVISH SOOD) JUDICIAL MEMBER ( G.S. PANNU ) ACCOUNTANT MEMBER MUMBAI, DATE : 3 1 S T JULY, 2017 * SSL * COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 5 SMT. LATA V. VASUDEVA ITA NO. 6422/MUM/2012 4) THE CIT CONCERNED 5) THE D.R, A BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI