SHRI VIJENDRA KUMAR CHANODIA, Indore V. THE ITO-WARD4(3), Indore

ITA 685/IND/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5798 (ITAT-INDORE)
• Duration Of Justice: 4 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 18-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: S S DESHPANDE
• Section: 44AD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI B.C.MEENA, ACCOUNTANT MEMBER I.T.A.NO. 685/IND/2015 A.Y. : 2008-09. SHRI VIJENDRA KUMAR CHANODIA, ITO, WARD 4(3), INDORE. VS. INDORE. APPELLANT RESPONDENT PAN NO. ADUPC1067G APPELLANTS BY : SHRI S. S. DESHPANDE, CA RESPONDENT BY : SHRI R. A. VERMA, DR O R D E R PER D.T.GARASIA, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A)-II, INDORE, DATED 31.07.2015 FOR THE ASS ESSMENT YEAR 2008-09. DATE OF HEARING : 09 .0 2 .2016 DATE OF PRONOUNCEMENT : 02 .0 2 .2016 SHRI VIJENDRA KUMAR CHANODIA, INDORE, VS. ITO, WD. 4(3), INDORE, I.T.A.NO. 685/IND/2015 A.Y. 2008-09 2 2 2. THE SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE DERIVES INCOME AS LABOUR CONTRACTOR AND HAVING GROS S RECEIPT OF RS. 61.31 LACS. THE BOOKS OF ACCOUNTS OF SUCH CO NTRACT BUSINESS WAS GOT AUDITED AND TAX AUDIT REPORT U/S 4 4AB OF THE ACT WAS FILED WITHIN TIME. THE ASSESSEE DERIVES THE INCOME FROM ARTIFICIAL JEWELLERY BUSINESS WHEREIN TOTAL TU RNOVER WAS RS. 9.43 LACS ONLY. THE BOOKS OF ACCOUNT OF THE SUC H BUSINESS WERE NOT MAINTAINED BEING A RETAIL TRADE AND INCOME THEREFROM WAS MUCH MORE THAN 8% OF THE TURNOVER AS PRESCRIBED U/S 44AD OF THE ACT I.E. RS. 1,41,581/-. THERE BEING NO BOOKS OF ACCOUNTS OF ARTIFICIAL JEWELLERY BUSINESS, AUDIT OF ACCOUNTS OF SUCH BUSINESS WAS NOT POSSIBLE AT ALL. THEREFORE, T HE AO HAS HELD THAT AUDIT REPORT SUBMITTED WAS TREATED AS INC OMPLETE AND CONSIDERED AS NON FURNISHING OF THE REPO9RT AT ALL AND HE HAS LEVIED THE PENALTY OF RS. 35,528/- U/S 271(B) O F THE ACT. 3. THE MATTER CARRIED TO THE LD. CIT(A) AND THE LD. C IT(A) HAS DISMISSED THE APPEAL. 4. DURING THE COURSE OF HEARING OF THE APPEAL, THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE ASSESS EE HAS SHRI VIJENDRA KUMAR CHANODIA, INDORE, VS. ITO, WD. 4(3), INDORE, I.T.A.NO. 685/IND/2015 A.Y. 2008-09 3 3 CARRIED OUT THE AUDIT REPORT IN RESPECT OF LABOUR C ONTRACT RECEIPT U/S 44AB OF THE ACT, AND WHICH WAS FILED. T HE ASSESSEE HAS NOT CARRIED OUT AUDIT REPORT OF ARTIFICIAL JEWE LLERY BUSINESS OF RS. 9.43 LACS. THE ASSESSEE WAS NOT CARRYING OUT THE AUDIT REPORT OF ARTIFICIAL JEWELLERY IN PREVIOUS YEAR ALS O AND THE DEPARTMENT WAS ACCEPTING IT. THE ASSESSEE HAS RIGHT LY NOT GOT HIS BOOKS OF ACCOUNT AUDITED FOR ARTIFICIAL JEWELLE RY BUSINESS AND THERE IS NO CONCEPT OF INCOMPLETE AUDIT REPORT. THEREFORE, THE PENALTY MAY BE DELETED. 5. ON THE OTHER HAND, THE LD. DR OBJECTED TO IT AND SUBMITTED THAT THE ASSESSEE HAS PARTIALLY CARRIED O UT THE AUDIT REPORT AND IT IS INCOMPLETE AUDIT REPORT. THEREFORE , THE PENALTY SHOULD BE LEVIED. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. WE ARE OF THE VIEW THAT IT IS ADMITTED FA CT THAT THE ASSESSEE HAS CARRIED AUDIT REPORT FOR HIS LABOUR CO NTRACT RECEIPT AND IT WAS SUBMITTED IN TIME AND TAX AUDIT REPORT U/S 44AB WAS FILED IN TIME. THEREFORE, THE PENALTY CANN OT BE LEVIED FOR CONTRACT BUSINESS. WE FIND THAT THE PENALTY CA N BE LEVIED SHRI VIJENDRA KUMAR CHANODIA, INDORE, VS. ITO, WD. 4(3), INDORE, I.T.A.NO. 685/IND/2015 A.Y. 2008-09 4 4 ONLY FOR RETAIL BUSINESS OF ARTIFICIAL JEWELLERY AN D THE TOTAL TURNOVER IS RS. 9.43 LACS. THEREFORE, WE MODIFY THE ORDER OF THE REVENUE AUTHORITIES AND WE DIRECT THE AO TO LEVY TH E PENALTY ONLY FOR ARTIFICIAL BUSINESS TURNOVER OF RS. 9.43 L ACS AND THE AO IS DIRECTED TO CALCULATED ACCORDINGLY. 7. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICA L PURPOSES. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 9 TH FEBRUARY, 2016. SD/- (B.C.MEENA) ACCOUNTANT MEMBER SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED : 9 TH FEBRUARY, 2016. CPU* 12.2