M R International , Kolkata V. ITO, Ward - 44(2), Kolkata , Kolkata

ITA 870/KOL/2018

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 7230 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 02-05-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOWDHURY
• Keywords: Depreciation
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH : KOLKATA [BEFORE HONBLE SHRI S.S. GODARA, JM] I.T.A NO. 870/KOL/201 8 ASSESSMENT YEAR : 2007-0 8 M R INTERNATIONAL -VS- ITO, WARD-44(2), KOLK ATA [PAN: AAFFM 0736 Q] (APPELLANT) ( RESPONDENT) FOR THE APPELLANT : SHRI P.K. SI NGH, CA FOR THE RESPONDENT : SHRI ROBIN CHOWDHUR Y, ADDL. CIT DATE OF HEARING : 12.09.2018 DATE OF PRONOUNCEMENT : 28.09.2018 ORDER 1. THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2007- 08 ARISES AGAINST THE CIT(A)-13, KOLKATAS ORDER DATED 16.01.2018 PASSED IN CASE NO. 158/CIT(A)-13/W-44(2)/KOL/2014- 15 INVOLVING PROCEEDINGS U/S 143(3) OF THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. IT EMERGES AT THE OUTSET THAT THE ASSESSEES SOL E SUBSTANTIVE GRIEVANCE RAISED IN THE INSTANT APPEAL SEEKS TO CHALLENGE THE CIT(A)S ACTI ON IN CONFIRMING DISALLOWANCE OF EXPENSES OF RS. 7,12,254/- UNDER VARIOUS ACCOUNTS D EBITED TO PROFIT AND LOSS ACCOUNT OUT OF TOTAL DISALLOWANCE OF RS. 13,74,847/- MADE IN TH E COURSE OF ASSESSMENT THEREBY PARTLY ALLOWING EXPENSES OF RS. 66,82,596/- IN THE LOWER A PPELLATE DISCUSSION READING AS FOLLOWS: 2 ITA NO.870/KOL/2018 M.R. INTERNATIONAL A.YR. 2007-08 2 DECISION:- I HAVE GONE THROUGH THE CONTENTION OF THE ASSESSEE , THE ORDER PASSED BY THE AO AND THE SUBMISSIONS MADE BY THE APPELLANT. THE D ECISION OF THIS APPEAL IS GIVEN AS UNDER: IN THIS CASE THE APPEAL IS FILED ON 29.01.2010 AGAI NST ORDER PASSED U/S 143(3) OF THE I.T. ACT. IN THIS CASE VARIOUS NOTICE DATED 08.01.2015, 10.02.2015, 27.06.2016, 22.11.2016 AND 03.04.2017 WERE ISSUED AND SERVED. IN THIS CASE NEITHER NOTICE COULD BE SERVED FROM THE ITO, W-44(2) NOR THE APPELLANT CAME FOR HEARING AND THE LAST HEARING ATTENDED BY HIM WAS 28.01.2015 WHERE HE HAS DEMANDED FOR SUFFIC IENT TIME OF OPPORTUNITY IN THE GROUND OF APPEAL ITSELF. THE APPELLANT HAS STATED T HAT : THE BUSINESS OF THE ASSESSEE BEING BASED IN VARANA SI AND THE AUDITOR AND TAX CONSULTANT BEING ALSO BASED IN VARANASI, A TAX PRAC TITIONER IN KOLKATA COULD BE ARRANGED ONLY IN MID NOVEMBER. THE AO DEMANDED THE BOOKS IN DECEMBER. THE TOTAL BOOKS WERE READY IN OUR COMPUTER. BUT GETTING THE B OOKS PRINTED AND SENDING THEM TO KOLKATA COULD NOT BE ARRANGED BY DECEMBER. HOW THE BOOKS ARE READY FOR SUBMISSION. THE DISALLOWANCE BY THE ITO WERE NOT BASED ON ANY S PECIFIC FINDINGS BUT DISALLOWED GENERALLY. THE ASSESSEE RESERVES THE RIGHT TO SUBMI T FURTHER GROUNDS AT THE TIME FOR HEARING OF THE APPEAL. BUT THE APPELLANT NEVER FILED ANY PAPER BOOK OR SUB MISSION AGAINST THE ORDER PASSED BY THE AO. PERUSAL OF ASSESSMENT ORDER SHOWS THAT THE AO HAS ADDED ENTIRE RECEIPT DUE TO REASON THAT VARIOUS OPPORTUNITY WAS GIVEN TO PROVE THAT EXPENSES BUT THE APPELLANT DID NOT PRODUCE AND DOCUMENTARY EVIDENCES. PERUSAL OF A PPELLANT NON-SUBMISSION OF DETAIL LAID TO THE AO TO GROSS PROFIT OF THE APPELLANT AT RS. 16,62,596/-. THE APPELLANT IS DEALER IN ELECTRIC BULB. THE GROSS PROFIT HAS BEEN WORKED OUT BY THE APPELLANT IS AT RS. 16,62,596/-. CONSIDERING THE NATURE OF BUSINESS OUT OF HIS TOTAL GROSS PROFIT OF RS. 16,62,596/- THE SAME OF RS. 16,62,596/- IS FURTHER ALLOWED AS AN EXPENSES APART FROM DEPRECIATION OF RS. 50,039. THE AO IS DIRECTED TO R ECOMPUTED THE INCOME ACCORDINGLY. 3. FEW KEY FACTS EMERGE FROM THE INSTANT CASE FILE AS WELL AS ABOVE EXTRACTED DISCUSSION. THIS ASSESSEE IS A TRADER IN BULBS ETC. BOTH THE LOWER AUTHORITIES HAVE ESTIMATED ITS PROFITS TO RS. 16,62,596/-. I FIND TH AT NEITHER THE ASSESSING OFFICER NOR THE CIT(A) HAVE COMPARED THE IMPUGNED ESTIMATION WITH THE CORRESPONDING RATE EITHER IN PRECEDING OR SUCCEEDING ASSESSMENT YEAR(S). THERE I S NO CHANGE IN SUSPICION THROUGHOUT. I THEREFORE DEEM IT FIT IN LARGER INT EREST OF JUSTICE THAT THE ASSESSING OFFICER NEEDS TO CONSIDER ASSESSEES IMPUGNED PROFITS TO B E AVERAGE OF THE THREE IMMEDIATE PRECEDING AND SUCCEEDING YEARS. LEARNED COUNSEL STA TES AT BAR THAT THE ASSESSEE UNDERTAKES TO FILE ALL THE RELEVANT DETAILS IN CONS EQUENTIAL PROCEEDINGS. I THEREFORE MAKE IT CLEAR THAT THE ABOVE ESTIMATION DIRECTION ISSUED TO THE ASSESSING OFFICER FOR REESTIMATION OF PROFITS AT AN AVERAGE OF CORRESPOND ING FIGURES OF THE PRECEDING OR 3 ITA NO.870/KOL/2018 M.R. INTERNATIONAL A.YR. 2007-08 3 SUCCEEDING ASSESSMENT YEAR(S) SHALL BE SUBJECT TO THE CONDITION OF THE ASSESSEE PLACING ON RECORD ALL RELEVANT DETAILS FAILING WITHIN THE THREE CHANCES FALLING WHICH THIS ORDER WOULD STAND VACATED. 4. THIS ASSESSEES APPEAL IS ACCEPTED FOR STATISTIC AL PURPOSES IN ABOVE TERMS. ORDER PRONOUNCED IN THE COURT ON 28.09.2018 SD/- [ S.S.GODARA ] JUDICIAL MEMBER DATED : 28.09.2018 SB, SR. PS COPY OF THE ORDER FORWARDED TO: 1. M.R. INTERNATIONAL, C/O, P.K. SINGH, 21, OLD COU RT HOUSE STREET, 4 TH FLOOR, ROOM NO. 438, KOLKATA-700001. 2. ITO, WARD-44(2), KOLKATA, AAYAKAR BHAWAN, 3, GOV T. PLACE , KOLKATA-700001. 3..C.I.T(A).- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVAT E SECRETARY HEAD OF OFFICE/D.D.O., ITAT, KOLKATA BENCHE S