AIBANI ENTERPRISE, MUMBAI V. ASST CIT CIR 24(1), MUMBAI

ITA 7505/MUM/2014

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0543 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 16-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAVDR
• Assessee Lawyers: JAY SHAH
• Keywords: Business income
• Section: 133(6)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A , MUMBAI , . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ITA NO.7505/MUM/2014 ASSESSMENT YEAR: 2010-11 M/S AIBANI ENTERPRISES, 501, ARC PLAZA, NEXT TO COUNTRY CLUB, VEERA DESAI EXRN. ROAD, JOGESHWARI-WEST, MUMBAI-400102 / VS. ACIT, CIRCLE-24(1), MUMBAI ( ! /ASSESSEE) ( ' / REVENUE) P.A. NO.AAKFA3942K ! / ASSESSEE BY SHRI JAY SHAH ' / REVENUE BY SHRI RAJESH KUMAR YADAV-DR ITA NO. 7505/MUM/2014 M/S AIBANI ENTERPRISES 2 # '$ % !& / DATE OF HEARING : 29/01/2018 % !& / DATE OF PRONOUNCEMENT 29/01/2018 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 07/10/2014 OF THE FIRST APPELLATE AUTHORITY, MUMBAI . THE GRIEVANCE OF THE ASSESSEE IS WITH RESPECT TO CONFIR MING THE ACTION OF THE ASSESSING OFFICER BY THE FIRST APPELL ATE AUTHORITY REJECTING THE BOOKS OF ACCOUNTS OF THE AS SESSEE INVOKING THE PROVISIONS OF SECTION 145(3) OF THE IN COME TAX ACT, 1961 (HEREINAFTER THE ACT) WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND FURTHER CONSIDERING THE PROFIT OF THE FIRM AT 10% OF THE TO TAL SALES RESULTING INTO ADDITION OF RS.35,88,648/- TO THE TO TAL INCOME OF THE ASSESSEE. 2. DURING HEARING, SHRI JAY SHAH, LD. COUNSEL FOR THE ASSESSEE, ADVANCED ARGUMENTS, WHICH IS IDENTICA L TO THE GROUND RAISED BY CONTENDING THAT THE BOOKS OF T HE ASSESSEE WERE WRONGLY REJECTED INVOKING THE PROVISI ONS OF SECTION 145(3) AND THE ESTIMATION OF THE PROFIT @ 1 0% OF THE ITA NO. 7505/MUM/2014 M/S AIBANI ENTERPRISES 3 TOTAL SALES IS WITHOUT ANY JUSTIFICATION. ON THE O THER HAND, SHRI RAJESH KUMAR YADAV, LD. DR STRONGLY DEFENDED T HE ADDITION AND INVOCATION OF SECTION 145(3) OF THE AC T. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF BUILDING/CONSTRUCTION/DEVELOPMENT, DECL ARED INCOME OF RS.45,26,760/- IN ITS RETURN FILED ON 13/10/2010, DECLARING THE PROFIT @ 5.57% OF THE TOT AL SALES. THE RETURN WAS PROCESSED U/S 143(1) OF THE ACT. LATER ON, NOTICES WERE ISSUED U/S 133(6) OF THE ACT TO VARIOUS PARTIES, THE DETAILS OF WHICH ARE AVAILABLE AT PAGE-2 OF THE ASSESSMENT ORDER. AS PER THE REVENUE, NO REP LY WAS RECEIVED TO THE NOTICES. THE ASSESSEE WAS CONVEYED THE RESULT OF NOTICES VIDE LETTER DATED 08/02/2013 AND THE ASSESSEE WAS ASKED TO PRODUCE THE PARTIES WITH WHOM THE TRANSACTIONS WERE CLAIMED TO BE MADE ALONG WITH THE COPIES OF THE BANK STATEMENT OF SUCH PARTIES. AS PER THE R EVENUE, ASSESSEE COULD NOT PRODUCE THE PARTIES. HOWEVER, TH E ASSESSEE FILED CONFIRMATION WITH RESPECT TO THREE P ARTIES AND DID NOT FILE ANY CONFIRMATION WITH RESPECT TO R EMAINING ITA NO. 7505/MUM/2014 M/S AIBANI ENTERPRISES 4 THREE PARTIES. THE LD. ASSESSING OFFICER REJECTED T HE BOOKS OF ACCOUNTS U/S 145(3) OF THE ACT, RESULTING INTO R EJECTION OF DECLARED PROFIT AND ESTIMATED THE PROFIT @ 10% OF S ALES AND THUS THE AMOUNT OF RS.35,88,648/- WAS ADDED TO THE TOTAL INCOME. 2.2. ON APPEAL BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEAL), THE FACTUAL MATRIX WAS CONSIDE RED AND THE ADDITION SUSTAINED BY THE LD. ASSESSING OFFICER WAS AFFIRMED. THE ASSESSEE IS AGGRIEVED AND IS IN APPEA L BEFORE THIS TRIBUNAL. 2.3. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE, ADVANCED ARGUMENTS AS HAS BEEN MENTIONED IN EARLIER PARAS OF THIS ORDER. THE CRUX OF THE ARGUMENT IS TH AT THE ASSESSEE IS IN A POSITION TO PRODUCE ALL THE PARTIE S AS PROPER OPPORTUNITY/TIME WAS NOT PROVIDED TO THE ASS ESSEE DURING ASSESSMENT STAGE. THUS, CONSIDERING THE TOTA LITY OF FACTS AND THE CIRCUMSTANCES NARRATED BEFORE US, WE ARE OF THE VIEW THAT ULTIMATE OBJECT OF ARTICLE-265 OF THE CONSTITUTION OF INDIA IS TO LEVY AND COLLECT DUE TA XES. THE ASSESSEE IS DIRECTED TO PRODUCE ALL THE PARTIES BEF ORE THE ASSESSING OFFICER AND OTHER NECESSARY EVIDENCE, IF ANY, IN ITA NO. 7505/MUM/2014 M/S AIBANI ENTERPRISES 5 SUPPORT OF ITS CLAIM. THE LD. ASSESSING OFFICER IS DIRECTED TO EXAMINE THE CLAIM OF THE ASSESSEE AND DECIDE AFRESH IN ACCORDANCE WITH LAW. THUS, THE APPEAL OF THE ASSESS EE IS ALLOWED FOR STATISTICAL PURPOSES. FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN TH E PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 29/01/2018. SD/- (G. MANJUNATHA) SD/- (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER # $ MUMBAI; + DATED : 29/01/2018 F{X~{T? P.S/. . . , %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. ,-./ / THE APPELLANT 2. 01./ / THE RESPONDENT. 3. 2 2 # 3! , ( ,- ) / THE CIT, MUMBAI. 4. 2 2 # 3! / CIT(A)- , MUMBAI 5. 5'6 0! , 2 ,-& , , # $ / DR, ITAT, MUMBAI 6. 7 8$ / GUARD FILE. / BY ORDER, / (DY./ASSTT. REGISTRAR) , # $ / ITAT, MUMBAI