M/s. R.C.Bansiwal & Brothers, Ajmer V. Deputy Commissioner Of Income Tax, Circle-1, Ajmer

ITA 795/JPR/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 1199 (ITAT-JAIPUR)
• Duration Of Justice: 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 07-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J C KULHARI
• Keywords: Reopening of assessment; Difference of opinion; Change of opinion
• Section: 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA. NO. 795/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2010-11 M/S R.C. BANSIWAL & BROTHERS PRAKASH ROAD, NAGRA, AJMER. CUKE VS. THE DCIT, CIRCLE-1, AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAFFR 6987 G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPOND ENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : NONE ( WRITTEN SUBMISSIONS) JKTLO DH VKSJ LS @ REVENUE BY : SHRI. J.C. KULHARI (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 06/09/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 10/09/2018 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF LD. CIT(A), AJMER DATED 16.04.2018 FOR THE ASSESSME NT YEAR 2010-11 WHEREIN THE ASSESSEE HAS TAKEN THE FOLLOWING GROUND S OF APPEAL: (1) THAT THE LEARNED AO & CIT (APPEALS) BOTH ERRED IN MAKING AN ADDITION OF RS. 260000/- BY DISALLOWING THE EXPE NSES CLAIMED, THE CIT APPEALS NOT GIVEN ANY REASONS IN H IS ORDER TO MENTION THE DECISION OF AO WITH REGARDS TO DISALLOW ANCE OF ITA NO. 795/JP/2018 M/S R.C. BANSIWAL & BROTHERS VS. DCIT 2 EXPENSES ON AD HOC BASIS WITHOUT POINTING OUT ANY D EFECTS IN BOOKS SIMPLY ON THE BASIS OF 8% NET PROFIT RATE APP LICABLE IN CASE OF TURNOVER MORE THAN 40 LACS WHICH IS QUITE W RONG BUT IT SHOULD HAVE BEEN CONSIDERED IN LETTER WAY THAN LESS TURNOVER. THE ADDITION IS QUITE WRONG & UNJUSTIFIED AND ONLY MAINTAINED TO SUPPORT AO ORDER WITHOUT CONSIDERING THE ARGUMEN T GIVEN IN WRITING AND/OR EXPLAINED AT THE TIME OF HEARING OF APPEAL. (2) THAT THE REOPENING OF ASSESSMENT U/S 148 ITSELF WAS WRONG & ILLEGAL AS THE BASIS ON WHICH THE CASE WAS REOPEN ED AS ON DATE ITSELF WRONG & THE RETURN WAS ALREADY ON FILE DULY FILED ON 19-02-17 AS ADMITTED IN ORDER. HENCE THE NOTICE ISS UED ON 30-3- 17 RECORDING REASONS FOR NO RETURN FILED IS QUITE W RONG & HENCE REOPENING IS MADE MERELY ON CHANGE OF OPINION BASIS. (3) THAT THE AO HAS NOT CONSIDERED THE WRITTEN SUBM ISSIONS & AUDITED STATEMENTS FILED WITH AUDIT REPORT U/S 44AB WITH NO REASONS. THE PAST HISTORY OF THE CASE & RESULTS NOT AT ALL CONSIDERED PRIOR TO MAKING AN ADDITION OF RS. 26000 0/- ON ADHOC BASIS (4) THAT THE NET PROFIT RATE WAS MORE THAN 8% OF G ROSS RECEIPTS IN SPITE OF MORE GROSS RECEIPTS OVER & ABOVE 40 LAC S EVEN & HENCE IT SHOULD HAVE BEEN ACCEPTED AS RETURN INCOME . (5) THAT THE ORDER IS BAD LAW OF BOTH THE LOWER AU THORITIES. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE IS ENGAGED IN CIVIL CONTRACTOR BUSINESS AND HAS DISCLOSED GROSS CONTRACT RECEIPT OF RS. 1,62,84,311/-. THE ASSESSMENT WAS COMPLETED U/S 14 3(3) R.W.S. 147 OF THE ACT WHEREIN THE ASSESSING OFFICER HAS ACCEPTED THE INCOME SHOWN IN THE RETURN OF INCOME, HOWEVER, HAS MADE A DISALL OWANCE OF EXPENSES AMOUNTING TO RS. 2,60,000/- AND THEREFORE, ASSESS T HE INCOME AT RS. 11,57,745/-. THE RELEVANT FINDING OF THE AO IS REP RODUCED AS UNDER:- ITA NO. 795/JP/2018 M/S R.C. BANSIWAL & BROTHERS VS. DCIT 3 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT HAS SUBMITTED THAT THE ASSESSEE THE ASSESSEE IS ENGAGED IN CIVIL CONTRACTO R SHIP BUSINESS. IT IS ALSO SUBMITTED THAT DURING THE YEAR UNDER CONSIDERA TION THE ASSESSEE HAS EXECUTED THE CONTRACT OF MAYO COLLEGE GENERAL C OUNSEL AND SOCIETY OF CATHOLIC DIOCESSION OF JAIPUR. THE TOTAL CONTRAC T RECEIPT HAS BEEN DECLARED AT RS. 1,62,84,311/- WHICH IS MATCHED WITH 26AS STATEMENT. THE TDS HAS ALSO BEEN CLAIMED AS PER 26AS STATEMENT . DURING THE COURSE OF ASSESSMENT PROCEEDING, THE THE ASSESSEE W AS SPECIFICALLY ASKED TO PRODUCE THE BILLS AND VOUCHERS OF PURCHASE S OF BRICKS, CEMENT, CONCERET, SAND STONE AS WELL AS EXPENDITURE DEBITED IN P&L A/C. IT IS EXPLAINED THAT THOUGH THE COMPUTERISED BOOKS WHICH WERE KEPT IN COMPUTER IS READY FOR VERIFICATION BUT CERTAIN BILL S AND VOUCHERS OF PURCHASES ARE MISSING BEING OLD MATTER AND ARE NOT SUBJECT TO VERIFICATION. IT IS FURTHER CONTENDED THAT THIS IS A CASE OF PARTNERSHIP FIRM AND BEFORE ALLOWING SALARY TO PARTNERS THE REMAININ G PROFIT IS MORE THAN 8%. IT IS NOT CASE OF NO BOOKS OF A/C AND TURNOVER OF THE ASSESSEE IS ALSO MORE THAN THE LIMIT PRESCRIBED U/S 44AB OF THE ACT. THEREFORE, IN ABSENCE OF BILLS AND VOUCHERS OF PURCHASES/ EXPENDI TURE, THE TRUE PROFIT CANNOT BE ASCERTAINED. CONSIDERING THE NATURE OF EXPENSES AND DEBITED IN BOOKS OF A/C WHICH IS ALMOS T IN CASH AND CANNOT BE VERIFIED FULLY. THEREFORE, A SUM OF RS. 2,60,000/- DISALLOWED BEING NOT VERIFIABLE AND INCU RRED FOR NON BUSINESS EXPEDIENCY AND ACCORDINGLY ADDED TO TH E TOTAL INCOME OF THE ASSESSEE. 3. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS UPHELD THE REOPENING U/S 148 OF ITA NO. 795/JP/2018 M/S R.C. BANSIWAL & BROTHERS VS. DCIT 4 THE ACT AND ALSO THE ADDITION OF RS. 2,60,000/-. NO W THE ASSESSEES IN APPEAL BEFORE US. 4. NONE HAS APPEARED ON BEHALF OF THE ASSESSEE, HOW EVER, WRITTEN SUBMISSIONS WERE FILED WHICH HAVE BEEN CONS IDERED AND THE LD. DR HAS BEEN HEARD. 5. AFTER HEARING BOTH THE PARTIES, WE FIND THAT THE ADDITION HAS BEEN MADE ON PURELY AN ADHOC BASIS AND THERE IS NO FINDING RECORDED BY THE ASSESSING OFFICER THAT THE EXPENSES HAVE NOT BEEN INCURRED FOR THE PURPOSES OF BUSINESS OR THE A SSESSEE HAS CLAIMED ANY BOGUS EXPENDITURE. IN LIGHT OF THE SAME , THE ADHOC DISALLOWANCE OF RS. 2,60,000/- IS HEREBY DIRECTED T O BE DELETED. 6. HAVING DECIDED THE MATTER IN FAVOUR OF THE ASSES SEE ON MERITS, WE DO NOT CONSIDER IT NECESSARY TO ADJUDICA TE THE GROUND RELATING TO REOPENING TO THE ASSESSMENT U/S 148 OF THE ACT. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10/09/2018. SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 10/09/2018. ITA NO. 795/JP/2018 M/S R.C. BANSIWAL & BROTHERS VS. DCIT 5 *SANTOSH VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- M/S R.C. BANSIWAL & BROTHERS, AJMER. 2. IZR;FKHZ@ THE RESPONDENT- DCIT, CIRCLE-1, AJMER. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE { ITA NO. 795/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR