Gursimran Distilleries Pvt Ltd., Hyd, Hyderabad V. ITO, Ward-2(2), Hyd, Hyderabad

ITA 650/HYD/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6052 (ITAT-HYDERABAD)
• Duration Of Justice: 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 15-03-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 06-05-2016
• Court: TRIBUNAL
• Department Lawyers: A SITARAMA RAO
• Assessee Lawyers: P MURALI MOHAN RAO

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A (SMC), HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 650/HYD/2016 ASSESSMENT YEAR: 2008-09 M/S. GURSIMRAN DISTILLERIES PVT. LTD., HYDERABAD [PAN: AACCG7428D] VS INCOME TAX OFFICER, WARD-2(2), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI P. MURALI MOHAN RAO, AR FOR REVENUE : SHRI A. SITARAMA RAO, DR DATE OF HEARING : 15-03-2017 DATE OF PRONOUNCEMENT : 22-03-2017 O R D E R THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF TH E COMMISSIONER OF INCOME TAX (APPEALS)-9, HYDERABAD D ATED 29-02-2016. 2. BRIEFLY STATED, ASSESSEE IS A COMPANY ENGAGED IN T HE BUSINESS OF MANUFACTURE AND SALE OF LIQUOR. FOR THE IMPUGNED ASSESSMENT YEAR IT DECLARED TOTAL INCOME OF RS. 7,37,830/-. IN T HE COURSE OF SCRUTINY PROCEEDINGS, ASSESSING OFFICER (AO) REJECT ED THE BOOKS OF ACCOUNT AND ESTIMATED PROFIT AT 1% ON GROSS SALES INCLU DING SCRAP SALES, MISCELLANEOUS INCOME AND INTEREST RECEIVED ETC. ON A TURNOVER OF RS. 43.27 CRORES, THE TOTAL INCOME WAS DET ERMINED AT RS. 43,27,911/-. THIS ORDER DT. 31-12-2010 WAS SUBJ ECT MATTER OF I.T.A. NO. 650/HYD/2016 M/S. GURSIMRAN DISTILLERIES PVT. LTD., :- 2 - : APPEAL BEFORE THE CIT(A)-3, HYDERABAD. THE LD.CIT(A) -3, HYDERABAD VIDE HIS ORDER DT. 01-11-2012 HAS CONSIDERED THE SUBM ISSIONS OF ASSESSEE AND DIRECTED THE AO TO ADOPT THE SAME GROSS P ROFIT AS DECLARED BY ONE M/S. KHASA DISTILLERY COMPANY AND CALCULATE THE INCOME ACCORDINGLY. HOWEVER, IN THE PROCESS IN SEEM S THE INCOME WAS ENHANCED, WITHOUT GIVING AN OPPORTUNITY TO ASSESS EE. THE MATTER WAS FURTHER CARRIED TO ITAT. ITAT VIDE ITS ORDE R IN ITA NO. 172/HYD/2013 DT. 05-09-2013 HAS RESTORED THE MATTER TO THE FILE OF CIT(A) FOR FRESH CONSIDERATION. HOWEVER, THE PRES ENT CIT(A)-9 WITHOUT NOTICING THE EARLIER ORDER OF CIT(A) DT. 01- 11-2012 OR THE ORDER OF THE ITAT, HOWEVER, DECIDED THE APPEAL EX-PARTE ASSESSEE CONFIRMING THE ORDER OF THE AO. ASSESSEE IS AGGRIEVE D ON THE SAID ORDER AND RAISED THE GROUNDS ACCORDINGLY. 3. AT THE OUTSET BOTH THE PARTIES HAVE AGREED THAT LD.CIT(A )S ORDER IS NOT ACCORDING TO THE DIRECTIONS GIVEN BY THE I TAT IN THE ABOVE REFERRED ORDER AND ACCORDINGLY HAS NO OBJECTIO N FOR SETTING ASIDE THE SAME TO BE RE-CONSIDERED. 4. I HAVE CONSIDERED THE RIVAL CONTENTIONS. WITHOUT GO ING INTO THE MERITS OF THE ADDITION MADE BY THE AO OR THE DECISION OF THE CIT(A), IT IS TO BE NOTED THAT LD.CIT(A) HAS PASSED TH E ORDER WITHOUT CONSIDERING THE DIRECTIONS OF THE ITAT. THE OR DER OF THE ITAT IN PARA 9 IS AS UNDER: 9. WE FIND MERIT IN THE ARGUMENT OF THE ASSESSEES COUNSEL AS THE CIT(A) OUGHT TO HAVE GIVEN AN OPPORTUNITY TO THE AS SESSEE BEFORE ENHANCING THE INCOME AT 18.77% OF GROSS SALES AS AG AINST AT 1% MADE BY THE ASSESSING OFFICER, WHEN HE WAS OF THE OPINION T HAT THE ESTIMATION ARRIVED AT 1% BY THE ASSESSING OFFICER IS NOT PROPE R. AFTER CONSIDERING THE FACTS OF THE CASE, WE ARE OF THE OPINION THAT TO ME ET THE ENDS OF JUSTICE, WE I.T.A. NO. 650/HYD/2016 M/S. GURSIMRAN DISTILLERIES PVT. LTD., :- 3 - : SET ASIDE THE ORDER OF THE CIT(A) AND REMIT THE ISS UE BACK TO HIM TO DECIDE THE SAME AFRESH AFTER PROVIDING AN OPPORTUNITY OF B EING HEARD TO THE ASSESSEE. BEFORE DECIDING THE ISSUE, THE CIT(A) IS DIRECTED TO FURNISH THE REASONS/DOCUMENTS FOR ARRIVING ESTIMATION OF NET PR OFIT AT 18.77% OF GROSS SALES TO THE ASSESSEE, ON WHICH, THE ASSESSEE IS AG ITATED. 4.1. SINCE THE ORDER OF THE CIT(A) HAS NEITHER CONSIDE RED THE EARLIER ORDER OF THE CIT(A) ON THE ISSUE NOR THE DIREC TIONS OF THE ITAT IMPLEMENTED, IN THE INTEREST OF JUSTICE, THE IMPU GNED ORDER OF THE CIT(A) IS SET ASIDE WITH A DIRECTION TO CONSIDER THE APPEAL AFRESH AS PER THE ORDERS OF THE ITAT QUOTED SUPRA. ASSESSEE SHOULD BE GIVEN DUE OPPORTUNITY BEFORE DECIDING THE APPEAL BY TH E LD.CIT(A). 5. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED FOR S TATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND MARCH, 2017 SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER HYDERABAD, DATED 22 ND MARCH, 2017 TNMM I.T.A. NO. 650/HYD/2016 M/S. GURSIMRAN DISTILLERIES PVT. LTD., :- 4 - : COPY TO : 1. M/S. GURSIMRAN DISTILLERIES PVT. LTD., HYDERABAD . C/O. P. MURALI & CO., CHARTERED ACCOUNTANTS, 6-3-655/2/3 , 1 ST FLOOR, SOMAJIGUDA, HYDERABAD. 2. THE INCOME TAX OFFICER, WARD-2(2), HYDERABAD. 3. COMMISSIONER OF INCOME TAX(APPEALS)-9, HYDERABAD . 4. THE PR. COMMISSIONER OF INCOME TAX-2, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.