I.T.O Wd - 4,Nadia, Nadia V. Aravinda Chandra Sarkar, Kolkata

ITA 814/KOL/2013

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1929 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-01-2018
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 12-04-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NICOLAS MURMU CITSR
• Assessee Lawyers: S N GHOSH
• Keywords: Opportunity of being heard; Corroborative evidences
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : KOLKATA [BEFORE HONBLE SRI N.V.VASUDEVAN, JM & SHRI M.BA LAGANESH, AM] I.T.A NO. 814/KOL/201 3 ASSESSMENT YEAR : 2009-1 0 I.T.O., WARD-4, -VS.- SHRI ARABINDA CHAN DRA SARKAR NADIA KOLKATA [PAN : ALVPS 6243 B] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI NICOLAS M URMU, ADDL. CIT,SR.DR FOR THE RESPONDENT : SHRI S.N.GHOSH, ADVOCATE DATE OF HEARING : 04.01.2018. DATE OF PRONOUNCEMENT : 10.01.2018. ORDER PER N.V.VASUDEVAN, JM THIS IS AN APPEAL BY THE REVENUE AGAINST THE ORDER DATED 01.02.2013 OF C.I.T.(A)-XXXVI, KOLKATA RELATING TO A.Y.2009-10. 2. GROUNDS OF APPEAL RAISED BY THE REVENUE READS A S FOLLOWS :- 1. THE LD CIT (A) ERRED IN ALLOWING EXPENSES TO TH E EXTENT OF RS 27, 89, 928/- UNDER THE HEAD SALARY &WAGES WHEN THE ASSESSEE FAIL ED TO DISCHARGE HIS ONUS OF PROVING THE GENUINENESS OF THE CLAIM OF EXPENDITURE WITH PROPER SUPPORTING EVIDENCE. 2. THE LD CIT (A) ERRED IN ESTIMATING THE NET PROFI T AT THE RATE OF 10% ON UNDISCLOSED RECEIPT OF RS 32, 35, 132/- ALLOWING AD DITIONAL EXPENSES NOT CLAIMED IN THE AUDITED P&L ACCOUNT ,WHILE UNDISCLOSED RECEIPT REPRESENTED PROFIT AND UNDISCLOSED EXPENDITURE PAID FROM A SOURCE NOT DISC LOSED TO THE REVENUE. 3. THE LD CIT (A) ERRED IN NOT TREATING THE ENTIRE UNDISCLOSED RECEIPT OF RS 32, 35, 132/- AS TAXABLE. 3. THE ASSESSEE IS AN INDIVIDUAL. HE DERIVES INCOME FROM ACTING AS LABOUR CONTACTOR. FOR A.Y.2009-10 THE ASSESSEE FILED RETURN OF INCOM E ON 01.12.2009 DISCLOSING TOTAL 2 ITA NO.814/KOL/2013 SHRI ARABINDA CHANDRA SARKAR A.YR.2009-10 2 INCOME OF RS.4,16,550/-. IN THE COURSE OF ASSESSMEN T PROCEEDINGS THE AO NOTICED THAT THE GROSS RECEIPTS SHOWN BY THE ASSESSEE FROM LABOU R CONTRACT BUSINESS WAS RS.81,35,614/- AND THE NET PROFIT SHOWN BY THE ASSE SSEE WAS A SUM OF RS.4,16,549/-. THE ENTITY FOR WHOM THE ASESSEE ACTED AS A LABOUR CONTR ACTOR WAS L & T LTD. THE ASSESEE HAD NOT PRODUCED BOOKS OF ACCOUNTS BEFORE THE AO N OR SUPPORTING EVIDENCE. THE ASSESSMENT WAS COMPLETED U/S 144 R.W.S. 145(3) (BES T JUDGMENT ASSESSMENT ). THE AO NOTICED FROM RECORDS THAT THE ASSESSEE HAD CLAIMED EXPENDITURE UNDER THE HEAD SALARIES AND WAGES OF RS.61,99,840/-. SINCE NO EVIDENCE WAS PRODUCED IN SUPPORT OF THE EXPENDITURE THE AO DISALLOWED 50% OF THE SALARIES A ND WAGES. SIMILARLY THE ASSESSEE HAD CLAIMED A SUM OF RS.4,18,685/- UNDER THE HEAD POWER AND FUEL. THIS WAS ALSO DISALLOWED BY THE AO FOR WANT OF SUPPORTING EVIDENC E. 4. AGGRIEVED BY THE AFORESAID ADDITIONS THE ASSESSE E PREFERRED APPEAL BEFORE THE CIT(A). THE CIT(A) NOTICED THAT AS PER 26AS AMOUNT RECEIVED FROM L & T LTD. WAS RS.1,13,70,746/- WHEREAS THE ASSESSEE HAD DECLARED CONTRACT RECEIPTS OF ONLY RS.81,35,614/-. THE CIT(A) IN EXERCISE OF HIS POWE RS OF ENHANCEMENT MADE AN ADDITION OF 10% OF THE UNDISCLOSED CONTRACT RECEIPT S OF RS.32,35,132/-(RS.1,13,10,746/- - 81,35,614/-) RESULTING IN AN ADDITION OF RS.3,23, 513/- TO THE TOTAL INCOME BY WAY OF ENHANCEMENT. 5. AS FAR AS THE DISALLOWANCE OF EXPENSES MADE BY T HE AO WAS CONCERNED THE CIT(A) HELD THAT DISALLOWANCE OF 50% OF SALARIES AN D WAGES WAS EXCESSIVE AND HE RESTRICTED TO 5% OF THE SALARIES AND WAGES. 6. AS FAR AS DISALLOWANCE OF POWER AND FUEL EXPENSE S ARE CONCERNED IN THE REMAND PROCEEDINGS BILLS AND VOUCHERS WERE PRODUCED AND HE NCE DISALLOWANCE MADE BY THE AO UNDER THIS HEAD WAS DELETED BY THE CIT(A). 3 ITA NO.814/KOL/2013 SHRI ARABINDA CHANDRA SARKAR A.YR.2009-10 3 7. AGGRIEVED BY THE RELIEF ALLOWED BY THE CIT(A) TH E REVENUE HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 8. AT THE TIME OF HEARING THE LD. COUNSEL FOR THE A SSESSEE FILED BEFORE US A COPY OF THE ORDER OF ITAT IN ITA NO..682/KOL/2013 WHICH WAS AN APPEAL FILED BY THE ASSESSEE AGAINST THE VERY SAME ORDER OF CIT(A) AGAINST WHICH THE REVENUE HAS PREFERRED THE PRESENT APPEAL. IN THAT APPEAL THE ASSESSEE HAD PRA YED FOR QUASHING OF THE ENTIRE ASSESSMENT ORDER ON THE GROUND THAT NO NOTICE U/S 1 43(2) WAS SERVED ON THE ASSESSEE. THIS PLEA HAD BEEN RAISED BY THE ASSESSEE BEFORE TH E CIT(A)BUT NOT ADJUDICATED BY THE CIT(A). THE TRIBUNAL BY ITS ORDER DATED 13.11.2013 HELD AS FOLLOWS :- 4. HAVING REGARD TO THE FACTS OF THE INSTANT CASE AND THE RIVAL BUT COMMON SUBMISSIONS MADE BEFORE US, WE SET ASIDE THE IMPUGN ED ORDER AND REMIT THE MATTER TO THE FILE OF ID. CIT(A) FOR DECIDING GROUND NOS.1 AND 2 OF THE ASSESSEE'S APPEAL AND THEREAFTER, TAKE UP THE OTHER GROUNDS ON MERITS , IF NEEDED. WE WANT TO MAKE IT CLEAR THAT NO OBSERVATION MADE IN THIS ORDER SHOULD BE CONSTRUED AS RENDERING ANY DECISION ON THE MERITS OF THESE TWO GROUNDS WHICH W ERE NOT DISPOSED OF BY THE ID. CIT(A). THE ISSUE HAS BEEN THROWN OPEN AT LARGE BEF ORE THE ID. CIT(A) TO DECIDE THESE GROUNDS AS PER LAW AFTER ALLOWING A REASONABL E OPPORTUNITY OF BEING HEARD TO THE ASSESSEE' 9. THE ASSESSEE HAS ALSO IN THAT APPEAL CHALLENGED THE ACTION OF THE CIT(A) IN MAKING AN ADDITION ON ACCOUNT OF UNDISCLOSED PROFIT S BY WAY OF ENHANCEMENT AND SUSTAINING DISALLOWANCE F 5% OF SALARIES AND WAGES. THESE GROUNDS WERE ALSO DIRECTED TO BE EXAMINED BY THE TRIBUNAL IF IT BECOMES NECESSARY . SINCE THE ISSUES THAT ARISES FOR CONSIDERATION ON REMAND BY TRIBUNAL OF ASSESSEES A PPEAL AND THE GROUNDS OF APPEAL IN THIS APPEAL ARE SAME, WE ARE OF THE VIEW THAT THE G ROUNDS RAISED BY THE REVENUE IN THIS APPEAL SHOULD ALSO BE DIRECTED TO BE CONSIDERED BY CIT(A). WE ACCORDINGLY SET ASIDE THE ORDER OF THE CIT(A) AND REMAND THE ISSUES RAISED BY THE REVENUE IN THIS APPEAL BEFORE US FOR FRESH CONSIDERATION ALONG WITH THE ISSUES REMAN DED BY THE TRIBUNAL IN THE ASSESSEES APPEAL. FOR STATISTICAL PURPOSES THE APPEAL IS TREA TED AS ALLOWED. 4 ITA NO.814/KOL/2013 SHRI ARABINDA CHANDRA SARKAR A.YR.2009-10 4 10. IN THE RESULT THE APPEAL BY THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COUR T ON 10.01.2018. SD/- SD/- [M.BALAGANESH] [ N.V.VAS UDEVAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 10.01.2018. [RG SR.PS] COPY OF THE ORDER FORWARDED TO: 1. SHRI ARABINDA CHANDRA SARKAR, FLAT NO0.B-4, NARA YAN TALA WEST, BAGUI HATI, KOLKATA-700059. 2. I.T.O., WARD-4, NADIA. 3. CIT(A)-XXXVI, KOLKATA 4. C.I.T.-XXI, KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVATE SECR ETARY HEAD OF OFFICE/ D.D.O., ITAT KOLKATA BENCHES