M/S. G. SACHANAND, Indore V. THE ITO-2(3), Indore

ITA 719/IND/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5716 (ITAT-INDORE)
• Duration Of Justice: 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-03-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 24-02-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 16-11-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: C P RAWKA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE (SINGLE MEMBER CASE) BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER I.T.A.NO.719/IND/2015 A.Y. : 2005-06 M/S.G.SACHANAND, ITO, INDORE. VS. 2(3), INDORE. APPELLANT RESPONDENT PAN NO. AACFG9318D A PPELLANT S BY : SHRI C.P.RAWKA, CA RESPONDENT BY : SHRI R.A.VERMA, DR O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A)-I, INDORE, DATED 25.08.2015 FOR THE ASSES SMENT YEAR 2005-06. DATE OF HEARING : 24 .02. 20 16 DATE OF PRONOUNCEMENT : 02 .0 3 . 201 6 M/S.G. SACHCHANAND, INDORE VS. ITO, 2(3), INDORE I.T.A.NO. 719/IND/2015 A.Y. 2005-06 2 2 2. GROUND NO.3 IS NOT PRESSED. HENCE, THE SAME IS DISMISSED AS NOT PRESSED. 3. GROUND NO.2 IS EFFECTIVE GROUND, WHICH READS AS UND ER :- THAT THE LD. CIT(A) HAS ERRED IN MAINTAINING AN ADDITION OF RS. 1,68,982/- AND IN NOT DELETING THE TOTAL ADDITION MADE BY THE AO AT RS. 3,83,982/-. 4. THE SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE DERIVES INCOME FROM PURCHASE AND SALE OF READY-MADE GARMENTS AND CLOTHS ON RETAIL BASIS. THE AUDIT REPO RT AND ACCOUNTS WERE DULY AUDITED U/S 44AB OF THE INCOME-T AX ACT, 1961. THE AO HAS NOT ACCEPTED THE BOOK RESULT OF TH E ASSESSEE AND THE AO HAS ESTIMATED THE GROSS PROFIT @ 17% AGA INST GROSS PROFIT DECLARED AT 15.35% AND ADDED RS. 3,83,982/-. 5. THE MATTER CARRIED TO THE LD. CIT(A) AND THE LD. CIT(A) HAS ESTIMATED THE GROSS PROFIT AT 16% AND PARTLY AL LOWED THE APPEAL. 6. I HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PART IES. I FOUND THAT THE ASSESSEE DEALS IN TWO CATEGORIES, NAMELY, M/S.G. SACHCHANAND, INDORE VS. ITO, 2(3), INDORE I.T.A.NO. 719/IND/2015 A.Y. 2005-06 3 3 CLOTH ACCOUNT AND READYMADE ACCOUNT. THERE WAS A NO MINAL DIFFERENCE IN STOCK IN CLOTH ACCOUNTS AND READY-MAD E ACCOUNTS AND NO ADVERSE INFERENCE WAS DRAWN. THERE WAS DIFFE RENCE OF STOCK OF RS. 6,52,889/- IN READY-MADE ACCOUNTS AND THE ASSESSEE COULD NOT EXPLAIN THE DIFFERENCE OF SHORTA GE OF STOCK IN READY-MADE ACCOUNT AND THERE WAS SURVEY AND DURI NG THE COURSE OF SURVEY, IT WAS FOUND THAT THE ASSESSEE DI D NOT PREPARE THE STOCK AS PER THE BOOKS OF ACCOUNT. THER EFORE, THE SALES WAS ESTIMATED AND KACHCHA BILLS WERE FOUND AT THE TIME OF SURVEY TO THE TUNE OF RS. 19,468/-. I FOUND THAT THE AO HAS TAKEN THE ESTIMATED SALES AT RS. 1.30 CRORES AND IN CREASED 5% OF TOTAL TURNOVER AND ESTIMATED GROSS PROFIT AT 16% BY THE AUTHORITIES BELOW. I FOUND THAT THE ADDITION OF RS. 1,68,982/- IS ON EXCESSIVE SIDE. THEREFORE, IN THE INTEREST OF JUSTICE AND FAIR PLAY, I, ON THE ESTIMATED BASIS ALLOW THE RELI EF OF RS. 25,000/- TO THE ASSESSEE AND REST OF RS. 1,43,982/- IS CONFIRMED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. M/S.G. SACHCHANAND, INDORE VS. ITO, 2(3), INDORE I.T.A.NO. 719/IND/2015 A.Y. 2005-06 4 4 THIS ORDER HAS BEEN PRONOUNCED IN THE OP EN COURT ON 02 MARCH, 2016, SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED : 02 ND MARCH, 2016. CPU* 24.1