Sri Yeshwanth Kumar Kishta, Prop: M/s Sony Travels, Hyderabad V. ITO, Ward 7(2), Hyderabad

ITA 796/HYD/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69941 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 20-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Depreciation; Charitable institution
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO. 796/HYD/2013 ASST. YEAR: 2008-09 SRI YESHWANTH KUMAR KISHTA,HYDERABAD. PAN: AGUPK9630L VS. THE INCOME-TAX OFFICER, WARD-7(2),HYDERABAD. APPELLANT RESPONDENT APPELLANT BY: MOHD. AFZAL RESPONDENT BY: SMT. K. HARITHA DATE OF HEARING: 05-12-2013 DATE OF PRONOUNCEMENT: 05.12.2013 O R D E R PER CHANDRA POOJARI, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 4-3-2013 OF THE CIT (A)-18, MUMBAI PERT AINING TO THE ASSESSMENT YEAR 2008-09. 2. THE GRIEVANCE OF THE ASSESSEE IN THIS APPEAL IS WITH REGARD TO DISALLOWANCE OF EXPENDITURE AT RS. 4 0,58,456/- THOUGH THE TOTAL TURNOVER OF THE ASSESSEE WAS ESTI MATED AT RS.1,07,01,377/- WHICH WORKS OUT TO 37.9% AND IN S IMILAR CASES, THE ASSESSING OFFICER ESTIMATED THE SAME AT 7.5% ON TOTAL TURNOVER. IN THIS CASE, THE ASSESSEE FILED R ETURN OF INCOME AT RS.3,22,814/-. THE ASSESSING OFFICER CAL LED FOR INFORMATION REGARDING THE PROOF OF INCURRING EXPEND ITURE ON VEHICLE INSURANCE, DIESEL OIL EXPENSES, VEHICLE MAI NTENANCE, DRIVER AND CLEANER SALARIES ETC., AND ALSO CALLED F OR INFORMATION REGARDING UNSECURED LOANS. THE ASSESSEE HAS NOT FI LED ITA NO. 64/HYD/2013 SULTAN & NOOR MOHD. ALLADIN CHARITABLE TRUST, HYD. ====================== 2 REQUISITE INFORMATION AND HENCE THE ASSESSING OFFIC ER MADE THE FOLLOWING DISALLOWANCES :- RTA TAXES RS.13,42, 800 VEHICLE INSURANCE RS. 2,86,00 0 DIESEL MAINTENANCE RS. 9,93,520 VEHICLE MAINTENANCE RS. 1,49,320 DRIVER AND CLEANERS SALARIES RS. 3, 08,000 DEPRECIATION RS. 55 ,200 SUNDRY TRADE CREDITORS RS.3,50,802/- UNSECURED LOANS RS.2,50,00 0 AGAINST THE ORDER OF THE ASSESSING OFFICER, THE ASS ESSEE WENT IN APPEAL BEFORE THE CIT (A). ON APPEAL, THE CIT ( A) CONFIRMED THE ORDER OF THE ASSESSING OFFICER OBSERV ING THAT THE ASSESSEE FAILED TO SUBMIT NECESSARY EVIDENCES I N SUPPORT OF THE CLAIM EVEN IN REMAND PROCEEDINGS. AGGRIEVE D AGAINST THE ORDER OF THE CIT (A), THE ASSESSEE PREFERRED AN APPEAL BEFORE US. 3. THE LEARNED COUNSEL FOR THE ASSESSEE HAS SUBMIT TED A COPY OF ASSESSMENT ORDER PASSED IN THE CASE OF M/S INDIA PUBLIC TRAVELS, 15-5-4, AFZAL GUNJ, HYDERABAD PERTA INING TO ASSESSMENT YEAR 2008-09 WHO ESTIMATED THE RATE OF PROFIT AT 7.5% OF THE TOTAL TURNOVER AND SUBMITTED THAT THE SAME RATE MAY BE DETERMINED IN THE INSTANT CASE ALSO. 4. ON THE OTHER HAND, THE LEARNED DR WHILE SUPPOR TING THE ORDER OF THE ASSESSING OFFICER IN THE INSTANT CASE SUBMITTED THAT BOTH THESE CASES ARE QUITE DIFFERENT AND NOT C OMPARABLE. 5. WE HAVE CONSIDERED RIVAL SUBMISSIONS OF THE PART IES AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT THE I NSTANT CASE IS NOT COMPARABLE WITH THE CASE OF M/S INDIA PUBLIC TRAVELS ITA NO. 64/HYD/2013 SULTAN & NOOR MOHD. ALLADIN CHARITABLE TRUST, HYD. ====================== 3 CITED BY THE LEARNED AR, BUT IN THE PRESENT CASE, THERE IS DISALLOWANCE OF EXPENDITURE AS WELL AS ADDITIONS T OWARDS UNEXPLAINED TRADE CREDITORS AND UNSECURED LOANS U/ S 68 OF THE ACT ALSO. BEING SO, WE ARE NOT INCLINED TO ACCEPT THE ARGUMENT OF THE ASSESSEES COUNSEL AND THE ASSESSEES INCOM E CANNOT BE ESTIMATED AT 7.5% OF GROSS RECEIPTS. THE ASSESS EE IS IN THE BUSINESS OF BUS OPERATIONS AND FAILED TO PRODU CE NECESSARY EVIDENCES TOWARDS INCURRING EXPENSES AS R EQUIRED. CONSIDERING THE NATURE OF ASSESSEES BUSINESS AND T HE FACTS AND THE CIRCUMSTANCES OF THE CASE, WE ESTIMATE THE INCOME AT RATE OF PROFIT AT 8% OF GROSS RECEIPTS. FURTHER, THERE IS ADDITION TOWARDS UNEXPLAINED UNSECURED CREDITS AND UNSECURED LOANS UNDER THE HEAD OTHER INCOME AND IT WILL BE CONSIDERED INCOME FROM OTHER SOURCES. THESE ADDIT IONS ARE MADE, AS THE ASSESSEE FAILED TO PROVE THE IDENTITY OF THE PARTY, GENUINENESS OF THE TRANSACTION AND CAPACITY OF THE CREDITOR. THE ASSESSEE WAS NOT ABLE TO DISCHARGE BURDEN CAST ON IT, IN OUR OPINION, IT IS JUST AND PROPER TO REMIT THIS IS SUE TO THE FILE OF THE ASSESSING OFFICER TO EXAMINE THE SAME IN ACC ORDANCE WITH LAW AFTER AFFORDING A REASONABLE OPPORTUNITY O F BEING HEARD TO THE ASSESSEE. WE DIRECT THE ASSESSEE TO CO -OPERATE WITH THE ASSESSING OFFICER AND FURNISH NECESSARY D ETAILS TO PROVE THE CREDITS AND UNSECURED LOAN.. 6. IN THE RESULT, THE APPEAL IS TREATED AS PARTLY A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 5-12-2013. SD/- (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED THE 5 TH DECEMBER, 2013 ITA NO. 64/HYD/2013 SULTAN & NOOR MOHD. ALLADIN CHARITABLE TRUST, HYD. ====================== 4 JMR* COPY FORWARDED TO: 1. C/O MOHD. AFZAL, ADVOCATE, 11-5-465, SHERSONS RESIDENCY, FLAT NO.402, CRIMINAL COURT ROAD, RED HI LLS, HYDERABAD. 2. THE ITO, WARD-7(2), HYDERABAD. 3 4. THE CIT(A)VI, HYDERABAD. CIT-5/6, HYDERABAD. 5. THE DR ITAT, HYDERABAD ITA NO. 64/HYD/2013 SULTAN & NOOR MOHD. ALLADIN CHARITABLE TRUST, HYD. ====================== 5 S.NO. DESCRIPTION DATE INTLS 1. DRAFT DICTATED ON SR.P.S./P.S 2. DRAFT PLACED BEFORE AUTHOR SR.P.S/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.P.S./PS SR.P.S./P.S 6. KEPT FOR PRONOUNCEMENT ON SR. P.S./P.S. 7. FILE SENT TO THE BENCH CLERK SR.P.S./P.S 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER