Balkishan Das Baijnath Distributors Pvt. ltd, Chaibasa V. ITO, Jamshedpur

ITA 84/RAN/2016

• Counselvise Citation: [2016] 130 COUNSELVISE.COM (IT) 9978 (ITAT-RANCHI)
• Duration Of Justice: 8 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 11-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SANJAY PAL
• Assessee Lawyers: RAJIV MITTAL
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 40A(3); 271(1)(b); 139; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI SMC BENCH, RANCHI BEFORE SHRI N.S SAINI, ACCOUNTANT MEMBER ITA NO. 84/RAN/2016 ASSESSMENT YEAR : 2010 - 2011 BALKISHAN DAS, BAIJNATH DISTRIBUTORS PVT LGD., MUNDHHRA HOUSE, EUROPEAN QUARTERS, CHAIBASA VS. ITO, WARD - 1(3), JAMSHEDPUR PAN/GIR NO. AADCB 5069 J (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : SHRI RAJIV MITTAL , AR REVENUE BY : SHRI SANJAY PAL , DR DATE OF HEARING : 7 /12/ 2016 DATE OF PRONOUNCEMENT : 7 /12/ 2016 O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE AGA INST THE ORDER OF CIT(A) - JAMSHEDPUR , DATED 18.12.2015 , FOR THE ASSESSMENT YEAR 2010 - 2011 . 2. THE SO L E ISSUE INVOLVED IN THIS APPEAL IS THAT THE LD CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE OF RS.2,11,104/ - UNDE R SECTION 40A(3) OF THE ACT. 3. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MOBILE PHONES, 2 ITA NO. 84/RAN/2016 ASSESSMENT YEAR : 2010 - 2011 SIM CARDS AND RECHARGE VOUCHERS, ETC. THE ASSESSEE HAS DISCLOSED NET PROFIT @ 0.05% AGAINST THE TURNOVER OF R S.12,12,94,329/ - , WHICH IS EXTREMELY LOW. HE OBSERVED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO FURNISH VOUCHERS OF EXPENSES INCURRED UNDER DIFFERENT HEADS FOR THE FIRST DAY OF EVERY MONTH BUT THE ASSESSEE FAILED TO PRODUCE THE SAME. FURTHER, ON EXAMINATION OF LEDGER OF EXPENSES, IT WAS FOUND THAT MOST OF THE EXPENSES HAVE BEEN INCURRED IN CASH AND HENCE, THEY ARE NOT VERIFIABL E. THEREFORE, HE REJECTED THE BOOK RESULTS OF THE ASSESSEE AND ESTIMATED THE INCOME OF THE ASSE SSEE BY APPLYING RATE OF 1.5% ON GROSS RECEIPTS OF RS.12,12,94,329/ - AND ARRIVED AT INCOME OF RS.18,19,415/ - . 4. ON APPEAL, LD CIT(A) OBSERVED THAT APART FROM P URCHASES, THE ASSESSEE HAS INCURRED TOTAL EXPENDITURE OF RS.13,18,184/ - . THE EXPENDITURE INCLUDES REMUNERATION TO DIRECTORS OF RS.5,25,000/ - , PAYMENT TO EMPLOYEES OF RS.2,26,250/ - AND INTEREST ON UNSECURED LOAN OF RS.2,92,800/ - . THUS, THE OTHER EXPENSES AGGREGATING TO RS.2,74,134/ - INCLUDES AUDIT FEES OF RS.17,648/ - AND FILING FEE OF RS.4,500/ - . RESULTANTLY, THERE IS AN EXPENDITURE OF RS.2,11,104/ - WHICH HAS BEEN INCURRED IN CASH FOR WHICH SUPPORTING VOUCHERS ARE AVAILABLE. HE OBSERVED THAT ESTIMATION C OULD HAVE BEEN DONE ONLY OF RS.2,11,104/ - . THE ASSESSING OFFICER HAS NOT GIVEN ANY COGENT REASON FOR ESTIMATING 30 TIMES OF DECLARED NET PROFIT @ 1.5% OF THE TOTAL TURNOVER. HENCE, HE 3 ITA NO. 84/RAN/2016 ASSESSMENT YEAR : 2010 - 2011 UPHELD THE ADDITION OF RS.2,11,104/ - OUT OF ADDITION OF RS.17,66,615/ - APART FROM INCOME SHOWN AT RS.52,800/ - BY THE ASSESSEE. 5. BEFORE ME LD A.R. DID NOT MAKE ANY SERIOUS ARGUMENTS ON THE GROUNDS OF APPEAL OF THE ASSESSEE. I, THEREFORE, FIND NO GOOD REASON TO INTERFERE WITH THE ORDER OF THE LD CIT(A), WHICH IS HEREBY CONF IRMED AND THE GROUNDS OF APPEAL OF THE ASSESSEE ARE REJECTED. 6. IN THE RESULT, THE APPEAL F ILED BY THE ASSESSEE IS DISMISSED. ORDER PRO NOUNCED IN THE OPEN COURT ON 7 /12/2016 IN THE PRESENCE OF PARTIES. SD/ - (N.S SAINI) A CCOUNTANT MEMBER RANCHI ; DATED 7 /12 /2016 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER, SR.PS, ITAT, CAMP AT RANCHI 1. THE APPELLANT : BALKISHAN DAS, BAIJNATH DISTRIBUTORS PVT LGD., MUNDHHRA HOUSE, EUROPEAN QUARTERS, CHAIBASA 2. THE RESPONDENT. ITO, WARD - 1(3), JAMSHEDPUR 3. THE CIT(A) JAMSHEDPUR 4. CIT , JAMSHEDPUR 5. DR, ITAT, RANCHI 6. GUARD FILE. //TRUE COPY//