ACIT 25 (1), MUMBAI V. SHUKLA BHOLANATH RAJPATI, MUMBAI

ITA 7229/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9646 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2015-2016
• Appeal Filed On: 25-11-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: BHARAT KUMAR LD
• Keywords: Business income
• Section: 40A(3); 143(3); 133A; 40(a)(ia); 201; 20

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI , , BEFORE HONBLE SHRI AMARJIT SINGH, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO .7230/MUM/2019 ( / ASSESSMENT YEAR: 2014 - 15 ) & ./ I.T.A. NO .72 29 /MUM/2019 ( / ASSESSMENT YEAR: 201 5 - 16 ) A CIT - 25(1) ROOM NO.202, 2 ND FLOOR KAUTILYA BHAVAN BANDRA KURLA COMPLEX, BANDRA (E) MUMBAI - 400 051 / VS. SHUKLA BHOLANATH RAJPATI 200/A, 2 ND FLOOR GREEN TOWER CHS L TD. GILBERT LANE, ANDHERI (W) MUMBAI - 400 053 ./ ./ PAN/GIR NO. ABFPR - 2174 - Q ( / APPE LLANT ) : ( / RESPONDENT ) ASSESSEE BY : SHRI BHARAT KUMAR - LD. AR REVENUE BY : SHRI VIJAY KUMAR JAISWAL LD. CIT - DR / DATE OF HEARING : 08/07/2021 / DATE OF PRONOUNCEMENT : 27/07/2021 / O R D E R MAN OJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEAL S BY REVENUE FOR ASSESSMENT YEAR S (AY) 2014 - 15 & 20 15 - 16 CONTEST S SEPARATE ORDERS OF LEARNED F IRST APPELLATE AUTHORITY . HOWEVER, FACTS AS WELL AS ISSUES ARE STATED TO 2 BE IDENTICAL AND THEREFORE , APP EALS WERE HEARD TOGETHER AND ARE NOW BEING DISPOSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AND PERUSED RELEVANT MATERIAL ON RECORD INCLUDING DOCUMENTS PLACED IN THE PAPER - BO OK. THE LD. AR SUBMITTED THAT THE APPELLATE AUTHORITY HAS MERELY FOLLOWED THE ORDER OF TRIBUNAL IN ASSESSEE S OWN CASE FOR EARLIER YEARS I.E., AYS 2009 - 10 TO 2013 - 14 AND THEREFORE, THE IMPUGNED ORDER WOULD NOT REQUIRE ANY INTERFERENCE ON OUR PART. A COPY OF THE TRIBUNAL ORDER HAS BEEN PLACED ON RECORD. THE LD. CIT - DR SOUGHT DISTINCTION IN FACT BY SUBMITTING THAT THE APPLICABILITY OF PROVISIONS OF SEC. 40A(3) AS WELL AS 40(A)(IA) HAS NOT BEEN EXAMINED. OU R ADJUDICATION TO THE SUBJECT MATTER OF APPEAL S WOULD BE AS GIVEN IN SUCCEEDING PARAGRAPHS. 3. 1 THE MATERIAL FACTS IN AY 2014 - 15 ARE THAT THE ASSESSEE BEING RESIDENT INDIVIDUAL IS STATED TO BE ENGAGED AS T OLL - COLLECTION CONTRACTOR AS WELL AS V EHICLE PARKING CONTRACTOR UNDER PROPRIETORSHIP CONCERN NAMELY M/S S.S.ENTERPRISES. THE OTHER FAMILY MEMBERS OF THE ASSESSEE ARE ALSO ENGAGED IN THE SAME LINE OF BUSINESS UNDER THEIR DIFFERENT PROPRIETORSHIP CONCERNS. AN ASSESSMENT WAS FRAMED FOR THE YEAR UNDER CONSIDERATION U/S 143(3) ON 31/12/2016 WHEREIN IT TRANSPIRED THAT THE ASSESSEE REFLECTED PROFIT OF RS.31.54 LACS AGAINST BUSINESS RECEIPTS WHICH TRANSLATED INTO NET PROFIT RATE OF 1.7%. 3.2 DURING SURVEY ACTION U/S 133A ON 19/03/2015 ON BUSINESS PREMISES OF THE ASSESSEE AND HIS FAMILY MEMBERS, IT WAS NOTED THAT TOTA L RECEIPTS OF THE ASSESSEE WERE APPROX. RS.300 CRORES 3 WHEREAS APPROXIMATE EXPENSES WERE NOT MORE THAN RS.10 CR ORES UNDER THE HEAD SALARY & W AGES, S TATIONERY ITEMS, STAFF WELFARE , CONVEYANCE, PETROL & DIESEL , RENTALS & OTHER EXPENSES. T HE ASSESSEES BOOKS OF ACCOUNT WERE NOT FOUND AT THE BUSINESS PREMISES RATHER IT WAS NOTED THAT THE ASSESSEE DID NOT MAINTAIN BOOKS FOR THE YEAR. ACCORDINGLY, LD. AO DISALLOWED 55% OF SALARY EXPENSES & 45% OF OTHER EX PENSES AS DETAILED IN THE ASSESSMENT ORDER. THE ESTIMATION WAS IN LINE WITH ESTIMATION MADE IN IMMEDIATELY PRECEDING AY 2013 - 14. 4. DURING APPELLATE PROCEEDINGS, THE ASSESSEE ASSAILED THE ACTION OF LD. AO, INTER - ALIA, BY RELYING UPON TRIBUNALS ORDER FOR EAR LIER YEARS IN ASSESSEES OWN CASE. THE LD .CIT(A), AFTER CONSIDERING FACTUAL MATRIX AS WELL AS ASSESSEES SUBMISSIONS , NOTED THAT PROFIT RATE SHOWN BY THE ASSESSEE IN EARLIER YEARS RANGED BETWEEN 1.78% TO 2.48%. POST SURVEY PERIOD , THE PROFIT RATE WAS IN THE RANGE OF 2.34% TO 2. 72%. IN THIS YEAR, THE PROFIT PER CENTAGE WAS 1.70%. SIMILAR ESTIMATION IN AY 2009 - 10 WAS MADE @ 3% DURING APPELLATE PROCEEDINGS WHICH WAS CONFIRMED BY THE TRIBUNAL. THEREFORE, ACCEPTING THE SAME, LD. AO WAS DIRECTED TO ADOPT NET PROFIT RATE OF 3% AND DELETE THE BALANCE ADDITION S . AGGRIEVED , THE REVENUE IS IN FURTHER APPEAL BEFORE US WHEREAS APPARENTLY, THE ASSESSEE HAS ACCEPTED THE VE R DICT OF LD. CIT(A) 5. UPON CAREFUL CONSIDERATION OF FACTUAL MATRIX, WE FIND THAT FACTS IN THIS YEAR ARE QUITE IDENTICAL TO FACTS IN EARLIER YEARS. IN FACT, LD . AR HAS PLACED ON RECORD A CHART TO DEMONSTRATE THAT GROUNDS RAISED BY REVENUE IN AYS 2009 - 10 TO 2015 - 16 ARE SUBSTANTIALLY THE SAME. NO CHANGE IN FACT S COULD BE DEMONSTRATED BY DEPARTMENT 4 BEFORE US. THEREFORE, SINCE THE ESTIMATION OF 3% MADE BY LD. CIT(A) IN EARLIER YEARS HAS BEEN CONFIRMED BY THE TRIBUNAL VIDE ITA NOS. 4505/MUM/2018 & ORS . COMMON ORD ER DATED 02/04/2019 AND THE ESTIMATION IN THIS YEAR IS SIMILAR, WE FIND NO REASON TO INTERFERE IN THE IMPUGNED ORDER. ACCORDINGLY, WE DISMISS THE REVENUES AP PEAL. SO FAR AS THE ARGUMENTS OF APPLICABILITY OF SEC.40A(3) OR 40(A)(IA) AS MADE BY LD. CIT - DR IS CONCERNED, WE ARE OF THE OPINION THAT SINCE INCOME HAS BEEN ESTIMATED WITHOUT REFERENCE TO ANY BOOKS, SEPARATE ADDITIONS IN THAT RESPECT WOULD NOT BE JUSTIFI ED. FINALLY, THE APPEAL STAND S DISMISSED. ASSESSMENT YEAR 2015 - 16 6. THE FACTS AS WELL AS ISSUES ARE SIMILAR IN THIS YEAR. THE LD. AO DISALLOWED CERTAIN EXPENSES. UPON FURTHER APPEAL, LD. CIT(A) DIRECTED LD. AO TO ESTIMATE THE INCOME @3%. AGGRIEVED, THE RE VENUE IS IN FURTHER APPEAL BEFORE US. FACTS BEING PARI - MATERIA THE SAME AS IN AY 2014 - 15, TAKING THE SAME VIEW, WE DISMISS THE APPEAL. CONCLUSION 7. BOTH THE APPEALS STAND DISMISSED. O RDER PR ONOUNCED ON 27 TH JULY 2021 SD/ - SD/ - ( AMARJIT SINGH ) (MANOJ KUMAR A GGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 27/07/2021 SR.PS, JAISY VARGHESE 5 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI .