Rajkamal Choudhary, V. Income Tax Officer 1,

ITA 74/JAB/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5725 (ITAT-JABALPUR)
• Duration Of Justice: 1 year(s) 11 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-04-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 09-04-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: D R LATHORIYA
• Assessee Lawyers: SANJAY MISHRA
• Section: 44AD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR BEFORE SHRI N.S. SAINI , HONBLE ACCOUNTANT MEMBER AND SHRI N.K. CHOUDHRY , HONBLE JUDICIAL MEMBER ITA NO. 7 4 / J AB /201 4 (ASST. YEAR : 200 6 - 0 7 ) RAJKAMAL CHOUDHARY, PROP. M/S. BETUL TRANSPORT , VILLAGE GHATI, TEHSIL ITARSI (MP) VS. ITO, WARD - 1, ITARSI PAN NO. ADWPV 6575 B (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SANJAY MISHRA ADV. DEPARTMENT BY : S HRI D.R. LATHORIYA - DR DATE OF HEARING : 05 / 0 4 /201 6 . DATE OF PRONOUNCEMENT : 0 5 / 04 /201 6 . O R D E R PER N.S. SAINI , ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) , BILASPUR CAMP AT BHOPAL , DATED 25 /0 1 /201 0 . 2. THE GROUND NO.1 OF THE APPEAL READS AS UNDER: - THAT THE CIT(A) ERRED BOTH IN LAW AND FACTS IN NOT CONSIDERING THE FACT THAT THE REOPENING OF THE CASE UNDER SEC. 147/148 OF THE INCOME TAX ACT, 1961 IMPROPER, ARBITRARY AND ERRONEOUS. 3 . AT THE TIME OF HEARING , THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT HE IS NOT PRESSING THIS GROUND OF APPEAL AND ALSO MADE AN ENDORSEMENT TO THIS EFFECT IN THE GROUND OF APPEAL ATTACHED WITH THE MEMO OF APPEAL. THEREFORE, THIS GROUND OF APPEAL O F THE ASSESSEE IS DISMISSED FOR WANT OF PROSECUTION. 2 ITA NO. 7 4 / JAB /201 4 4 . GROUND NOS. 2 TO 4 OF THE APPEAL, THE GRIEVANCE OF THE ASSESSEE IS THAT THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ADDITION OF RS. 3,93,893/ - . 5. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER OBSERVED THAT THE TOTAL TRANSPORT RECEIPTS AS PER THE TDS CERTIFICATES ENCLOSED WITH THE RETURN OF INCOME WAS AT RS. 1,26,56,103/ - , WHEREAS THE ASSESSEE IN ITS INCOME AND EXPENDITURE ACCOUNT FILED WITH THE RETURN OF INCOME HAS SHOWN REC E IPTS AT RS. 59,11,680/ - . THEREFORE, THE ASSESSING OFFICER APPLYING THE PROVISIONS OF SEC. 44AD ESTIMATED THE INCOME OF THE ASSESSEE AT 8% OF GROSS RECEIPTS OF RS. 1,26,56,103/ - AND ASSESSED THE INCOME OF THE ASSESSEE AT RS. 10,12,488/ - . 6 . ON APPEAL FILED BY THE ASSESSEE, THE COMMISSIONER OF INCOME TAX (APPEALS) HELD THAT THE ASSESSEE HAS SUBMITTED RECONCILIATION STATEMENT WITH GROSS RECEIPTS AT RS. 1,22,59,264/ - I .E. RS. 70,35,847/ - TOWARDS FREIGHT AND TRANSPORTATION ACTIVITIES AND RS. 55,08,884/ - TOWARDS CLEARING AND FORWARDING ACTIVITIES. THUS, THE GROSS RECEIPTS ARE UNDER STATED BY RS. 3,93,893 / - AND HELD THAT THIS IS REQUIRED TO BE ADDED TO THE INCOME OF THE ASSESSEE. HE ALSO OBSERVED THAT THE ASSESSING OFFICER HAS APPLIED NET PROFIT RATE OF 8% OF THE TURNOVER BY BORROWING THE PROVISIONS OF SEC. 44AD OF THE ACT WHICH IS PRIMA FACIE INCORRECT W HEN THE ASSESSEE IS A TRANSPORT CONTRACTOR AND THE TURNOVER OF THE YEAR EXCEEDS RS. 40 LAC. THEREFORE, HE DIRECTED THE ASSESSING OFFICER TO ACCEPT THE PROFIT SHOWN BY THE ASSESSEE IN THE RETURN OF INCOME AT RS. 2,60,610/ - AND ENHANCED IT BY RS. 3,93,893/ - A ND ASSESSED THE TOTAL INCOME AT RS. 6,54,503/ - . 7. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE ARGUED THAT THE ENTIRE REC E IPTS OF RS. 3,93,893/ - CANNOT BE THE INCOME OF THE ASSESSEE. HE 3 ITA NO. 7 4 / JAB /201 4 SUBMITTED THAT A NET PROFIT RATE OF 8% SHOULD BE APPLIED TO THE SAME AND INCOME BE COMPUTED ACCORDINGLY. 8. ON THE OTHER HAND, DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS). 9. HAVING HEARD RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSING OFFICER OBSERVED THAT AS PER TDS CERTIFICATES FILED BY THE ASSESSEE WITH THE RETURN OF INCOME, THE TOTAL RECEIP TS OF THE ASSESSEE WORKED OUT TO RS. 1,26,56,103/ - , WHEREAS THE ASSESSEE HAD SHOWN RECEIPTS AT RS. 1,22,59,264/ - . T HEREFORE, THE ASSESSING OFFICER REJECTED THE BOOK RESULTS AND ESTIMATED THE INCOME OF THE ASSESSEE BY APPLYING NET PROFIT RATE AT 8% ON THE ENTIRE RECEIPTS FROM TRANSPORT BUSINESS OF RS. 1,26,56,103/ - AND ASSESSED THE INCOME OF THE ASSESSEE AT RS. 10,12,488/ - . ON APPEAL, COMMISSIONER OF INCOME TAX (APPEALS) HELD THAT AS THE GROSS RECEIPTS OF THE ASSESSEE FROM TRANSPORTATION BUSINESS EXCEEDS TO RS. 40 LAC. THEREFORE, THE RATE OF 8% PROVIDED IN SEC. 44AD WAS NOT APPLICABLE IN THE CASE OF THE ASSESSEE. THEREFORE, HE HELD THAT THE PROFIT SHO WN BY THE ASSESSEE AT RS. 2,60,610/ - FROM TRANSPORTATION BUSINESS SH O ULD BE ENHANCED BY SHORT RECEIPTS SHOWN IN THE PROFIT & LOSS ACCOUNT OF RS. 3,93,893/ - AND THE INCOME OF THE ASSESSEE SHOULD BE ASSESSED AT RS. 6,54,503/ - . THE CONTENTION OF THE ASSESSEE IS THAT THE SHORT RECEIPTS OF RS. 3,93,893/ - CANNOT BE THE INCOME OF THE ASSESSEE. HE SUBMITTED THAT NET PROFIT RATE OF 8% SHO U LD BE APPLIED TO THE SAME AND THE SAME SHOULD BE CONSIDERED AS THE INCOME OF THE ASSESSEE FROM SHORT RECEIPTS O F RS. 3,93,893/ - . WE FIND THAT NO EVIDENCE WAS BROUGHT ON RECORD BY THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE TO SHOW THAT THE EXPENDITURE PERTAINING TO THE RECEIPTS OF RS. 3,93,893/ - WAS NOT CLAIMED BY IT IN THE PROFIT & LOSS ACCOUNT FILED WITH THE R ETURN OF INCOME. IN ABSENCE OF THE SAM E , IN OUR CONSIDERED VIEW, THE COMMISSIONER OF INCOME TAX (APPEALS) WAS 4 ITA NO. 7 4 / JAB /201 4 JUSTIFIED IN MAKING THE ADDITION OF ENTIRE SHORT RECEIPTS SHOWN BY THE ASSESSEE OF RS. 3,93,893/ - IN ESTIMATING THE INCOME OF THE ASSESSEE AT RS . 6,54,503/ - . WE THEREFORE, DO NOT FIND ANY MERIT IN THESE GROUNDS OF APPEAL OF THE ASSESSEE AND ACCORDINGLY THE SAME ARE DISMISSED. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING ON TUESDAY , THE 0 5 TH DAY OF APRIL , 201 6 AT JABALPUR . S D/ - SD/ - ( N.K. CHOUDHRY ) (N.S.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER D ATED : 0 5 TH APRIL , 201 6 . VR/ - COPY TO: 1. THE ASSESS E E. 2. THE REVENUE. 3. THE CIT 4. THE CIT(A) 5. THE D.R . 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY, ITAT, JABALPUR.