ABC Vehicles P Ltd., , Pune V. Deputy Commissioner of Income-Tax, Cricle 1(1). , Pune

ITA 662/PUN/2022

AI Insights

The case involves ABC Vehicles P. Ltd., a company engaged in the business of dealing with four-wheeler vehicles, which appealed against the order of the National Faceless Appeal Centre (NFAC), Delhi. The appeal was directed against an ex-parte assessment order under section 144 of the Income Tax Act, 1961, which significantly increased the company's declared turnover and assessed a higher income. The primary contention was the lack of a disclosed basis for the adopted turnover figure by the Assessing Officer. The Tribunal noted the absence of compliance by the assessee in previous hearings and the failure to appear at the Tribunal despite notice. The Tribunal decided to remand the case for a detailed assessment with a clear basis for the turnover figure.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137008 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2023
• Appeal Filed By: Assessee
• Order Result: AllowedAllowed
• Bench Allotted: A
• Next Hearing Date: 27-02-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 29-08-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A” : PUNE BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA.No.662/PUN./2022 Assessment Year 2015-2016 ABC Vehicles P. Ltd., Pro-1, Business Centre, Plot No.968+969, Senapati Bapat Road, Shivajinagar, Pune. PIN – 411 016 PAN AAGCP9049R vs. The DCIT, Circle -1 (1), Pune. (Appellant) (Respondent) For Assessee : -None- For Revenue : Shri Ramnath P. Murkunde Date of Hearing : 28.02.2023 Date of Pronouncement : 28.02.2023 ORDER PER INTURI RAMA RAO, A.M. This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre [in short “NFAC”], Delhi, dated 05.08.2022 passed Din & Order No.ITBA/NFAC/S/250/2022-23/1044518924(1) of the Income Tax Act, 1961 (in short "the Act"). The assessee has raised the following grounds of appeal : “The following grounds are taken without prejudice to each other - On facts and in law, 2 ITA.No.662/PUN./2022 ABC Vehicles P. Ltd., Pune. 1. The learned Dy. Commissioner of Income Tax has erred in law and on facts in while rejecting the books of account and arriving at figure of turnover of the company. 2. The learned Dy. Commissioner of Income Tax has erred in law and on facts in making addition of Rs. 65.20 lacs for want of source of income in case of Shri. Hrishikesh Shiodkar (Director). 3. The appellant craves leave to add, alter, amend or delete any of the above ground of appeal as and when required.” 2. Briefly the facts of the case are that the appellant is a private company engaged in the business of dealing in four wheeler vehicles. The return of income filed for the impugned assessment year 2015-16 was filed on 29.09.2015 declaring loss of Rs.1,72,23,121/-. Against the said return of income, an ex-parte assessment u/s. 144 of the Act was completed by the Assessing Officer vide order dated 21.12.2017 and the total income of the assessee company was determined at Rs.3,35,69,752/-. While doing so, the Assessing Officer estimated the net profit of turnover at Rs.33,81,21,898/- @ 8% as against the declared turnover of Rs.1,64,54,441/-. Being aggrieved by the above assessment order, the appellant was preferred an appeal before the Ld. CIT(A)'s who vide impugned order, confirmed the ex-parte assessment as the assessee has 3 ITA.No.662/PUN./2022 ABC Vehicles P. Ltd., Pune. failed to comply with the statutory notice issued u/s.143(2) of the Income Tax Act, 1961. It appears that even before the Ld. CIT(A), no compliance to the hearing notice was made by the appellant. Being aggrieved, the assessee preferred the present appeal before the Tribunal. 3. During the course of hearing, it is noticed that the assessee did not appear before the Tribunal despite service of notice of hearing. The grievance sought to be raised by the appellant in the present appeal is that the Assessing Officer estimated the net profit at 8% on the turnover of Rs.33,81,21,898/- as against the declared turnover of Rs.1,64,54,441/-. We have carefully gone through the orders of the lower authorities and find that the Assessing Officer has estimated the turnover of Rs.33,81,21,898/- without disclosing the basis on which the turnover was adopted at Rs.33,81,21,898/-. It is settled position of law that even on best judgment the assessment should be based on some material and cannot be based on surmises and conjectures. Since the Assessing Officer had not disclosed the basis of arriving at the turnover of turnover of Rs.33,81,21,898/-, we are of the considered opinion that the matter be remanded to the Assessing Officer for de novo assessment disclosing the basis of arriving at the gross turnover adopted by him at 4 ITA.No.662/PUN./2022 ABC Vehicles P. Ltd., Pune. Rs.33,81,21,898/-, after affording an opportunity of being heard to the appellant. 4. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 28 th February, 2023. Sd/- Sd/- [S.S. VISWANETHRA RAVI] [INTURI RAMA RAO] JUDICIAL MEMBER ACCOUNTANT MEMBER Pune, Dated 28.02.2023 VBP/- Copy to 1. The appellant 2. The respondent 3. The Ld. CIT(A) Pune-1, Pune. 4. The CCIT, Pune 5. D.R. ITAT, Pune “A” Bench, Pune 6. Guard File. //By Order// Assistant Registrar, ITAT, Pune Benches, Pune.