The ACIT, Central Circle-1(1), Ahmedabad V. Uma Shakti Corporation Residency Project, Ahmedabad

ITSSA 192/AHD/2013

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 0303 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 10 month(s) 20 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 29-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 13-07-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 09-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P SHARMA
• Assessee Lawyers: S CHHAJED
• Keywords: Audit objection; Tax effect
• Section: 192

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH (BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) IT(SS)A. NO: 192 /AHD/2013 (ASSESSMENT YEARS: 2009-10) A.C.I.T. CENTRAL CIRCLE - 1(1), AHMEDABAD V/S UMA SHAKTI COPORATION RESIDENCY PROJECT, 27, UMA BUNGLOWS, R. C. TECHNICAL ROAD, BEHIND NIRMAN TOWERS, GHATLODIYA, AHD. PAN AACFU2135J (APPELLANT) (RESPONDENT) IT (SS) A . NO: 193 / AHD/2013 & ITA NO. 1372/AHD/2013 (ASSESSMENT YEARS: 2009-10 & 2010-11) A.C.I.T. CENTRAL CIRCLE - 1(1), AHMEDABAD V/S UMA SHAKTI CORPORATION A- 128, HERITAGE BUNGLOWS, SCIENCE CITY ROAD, AHMEDABAD-380060 PAN AACFU0639H (APPELLANT) (RESPONDENT) IT(SS)A. NO: 199 & 200/AHD/2013 (ASSESSMENT YEARS: 2009-10 & 2010-11) UMA SHAKTI CORPORATION A-128, HERITAGE BUNGLOWS, SCIENCE CITY ROAD, AHMEDABAD-380060 V/S A.C.I.T. CENTRAL CIRCLE - 1(1), AHMEDABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI O.P. SHARMA, CIT/DR RESPONDENT BY : SHRI S. CHHAJED ITA NOS. 192 & 193/AHD/2013 & ITA 1372/AHD /2013 AND OTHERS . A.YS. 2009- 10 & 2010-11 2 ( )/ ORDER DATE OF HEARING : 31 -01-201 9 DATE OF PRONOUNCEMENT : 29 -03-2019 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THESE THREE APPEALS FILED BY THE REVENUE ARE DIRECT ED AGAINST THE ORDER OF THE LD. CIT(A)-I, AHMEDABAD DATED 18.02.2013 & 21.02.20 13 PERTAINING TO A.YS. 2009-10 & 2010-2011. 2. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUB MITTED THAT THE PRESENT APPEAL OF THE REVENUE NEEDS TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE RECENT CBDT CIRCULAR NO. 3 OF 2018 DATED 11.07. 2018. LD. DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT THE TAX EFFECT INVOLVED IN THIS APPEAL IS LESS THAN THE LIMIT PRESCRIBED BY THE AFORESAID CBDT CIR CULAR. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATE RIAL AVAILABLE ON RECORD. WE FIND THAT PRIMA-FACIE THIS APPEAL OF THE REVENUE IS NOT MAINTAINABLE IN VIEW OF THE RECENT CBDT CIRCULAR NO. 03/2015 IN F.NO.279 /MISC. 142/2007-ITJ (PT) DATED 11 TH JULY 2018, VIDE WHICH IT HAS BEEN DECIDED BY THE B OARD THAT NO DEPARTMENTAL APPEALS SHOULD BE FILED BEFORE THE TRI BUNAL IF THE TAX EFFECT BY VIRTUE OF THE COMMISSIONER OF INCOME-TAX (APPEALS) S ORDER IS BELOW RS. 20 LACS. THE BOARD HAS PROVIDED EXCEPTIONS AT CLAUSE ( 10) OF THE INSTRUCTIONS WHEREIN IT HAS BEEN PROVIDED THAT THESE INSTRUCTION S WILL NOT BE APPLICABLE, WHERE THE CONSTITUTIONAL VALIDITY OF THE PROVISIONS OF AN ACT/RULE IS UNDER CHALLENGE OR WHERE BOARDS ORDER, NOTIFICATION, INS TRUCTION OR CIRCULAR HAS BEEN HELD TO BE ILLEGAL OR WHERE REVENUE AUDIT OBJECTION IN THE CASE HAS BEEN ACCEPTED BY THE DEPARTMENT OR WHERE THE ADDITION RE LATES TO UNDISCLOSED ITA NOS. 192 & 193/AHD/2013 & ITA 1372/AHD /2013 AND OTHERS . A.YS. 2009- 10 & 2010-11 3 FOREIGN ASSETS/BANK ACCOUNTS, ETC. WE FIND THAT T HE PRESENT CASE DOES NOT FALL WITHIN THE EXCEPTION CLAUSE AND THE TAX IS LESS THA N RS.20 LACS. THEREFORE, THE PRESENT APPEAL IS NOT MAINTAINABLE AND HENCE DISMIS SED. 4. IN THE RESULT, ALL THE THREE APPEALS FILED BY THE R EVENUE ARE DISMISSED. NOW WE COME IT(SS)A NOS. 199/AHD/2013 FOR A.Y. 2009 -10. 5. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-I, AHMEDABAD DATED 21.02.2013 PERTAINING TO A.Y. 2009- 10 AND ASSESSEE HAS TAKEN FOLLOWING GROUNDS: 1.THE ORDER PASSED BY THE LD. CIT (A) IS AGAINST, L AW EQUITY AND JUSTICE. 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN REJECTING THE EXPLANATION OF THE APPELLANT THAT AN UNACCOUNTED/ EXTRA WORK COLLECTIO N FOR THE PROJECT DURING THE YEAR OF RS. 84,75,799/- NET PROFIT SHOWN @20& IN TH E A.Y. 2010-11. 3. THE LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN ESTIMATING NET PROFIT @ 30% BEING RS.25,43,740/- ON COLLECTION OF EXTRA WORK OF RS. 84,75,499/- DURING THE YEAR. . 4.THE APPELLANT CRAVES LIBERTY TO ADD, AMEND, ALTER OR MODIFY ALL OR ANY GROUNDS BEFORE FINAL HEARING. 6. SO FAR GROUND NOS. 1 & 2 ARE CONCERNED, LD. CIT(A) HAS REJECTED THE CLAIM OF THE APPELLANT THAT ITS NET PROFIT IS NOT MORE THAN 20%. LD. A.R. CITED AN ORDER OF CO-ORDINATE BENCH IN ITA NO. 1370 & 1376/AHD/201 3 IN CROSS APPEALS BY REVENUE AND ASSESSEE RESPECTIVELY FOR ASSESSMENT YE AR 2010-11 IN ASSESSEES OWN CASE WHEREIN CO-ORDINATE BENCH HAS GIVEN FOLLOW ING OBSERVATIONS: 32. FROM GOING THROUGH THE TABLE, WE NOTICE THAT NE T PROFIT RATES OFFERED IS BETWEEN 1.31 % TO 20%; WHEREAS ASSESSEE HAS OFFERED 20% NET PROFIT RATE. ON ITA NOS. 192 & 193/AHD/2013 & ITA 1372/AHD /2013 AND OTHERS . A.YS. 2009- 10 & 2010-11 4 THE OTHER HAND, ID, CIT(A) HAS ALSO FOLLOWED THE DE CISION OF THE INCOME-TAX SETTLEMENT COMMISSION BUT HAS NOT POINTED OUT ANY E RROR IN THE INCOME ESTIMATION BY THE ASSESSEE. EVEN BEFORE THE ID. ASS ESSING OFFICER ALSO NO SUCH MATERIAL WAS FOUND TO SHOW THAT ASSESSEE HAS GIVEN A WRONG CALCULATION. IT SEEMS THAT THE ID. CIT(A) HAS JUST MADE GUESS WORK OF ESTIMATING; 30% NET PROFIT RATE. WE ARE, THEREFORE, OF THE VIEW THAT EVEN IN D IE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE AND IN VIEW OF THE FACT T HAT THE NET PROFIT RATE OFFERED BY THE ASSESSEE IS MUCH MORE THAN ITS NORMAL GROSS PROFIT AND NET PROFIT RATE CONSISTENTLY OFFERED IN ITS RETURN OF INCOME AND AL SO IN THE GIVEN FACT WHEN THE UNACCOUNTED TURNOVER IS NOT DISPUTED BY THE REVENUE AUTHORITIES, WE ARE OF THE VIEW THAT INCOME OFFERED BY THE ASSESSEE AT 20% SHO ULD HAVE BEEN ACCEPTED BY THE ASSESSING AUTHORITIES AND NO FURTHER ADDITION W AS CALLED FOR. WE ACCORDINGLY ALLOW THE GROUND OF THE ASSESSEE ARID DISMISSED THA T OF THE REVENUE. 7. THEREFORE, IN PARITY WITH THE ABOVE SAID CO-ORDINAT E BENCH DECISION, WE ALLOW THIS GROUND OF APPEAL OF THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. IT(SS)A NOS. 200/AHD/2013 FOR A.Y. 2010-11 9. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-I, AHMEDABAD DATED 21.02.2013 PERTAINING TO A.Y. 2010- 11 AND ASSESSEE HAS TAKEN FOLLOWING GROUNDS: 1. THE ORDER PASSED BY THE LD. CIT (A) IS AGAINST, LAW EQUITY AND JUSTICE. 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN REJECTING THE EXPLANATION OF THE APPELLANT THAT ON TOTAL UNACCOUNTED/ EXTRA WORK COL LECTION FOR THE PROJECT OF RS. 1,34,76,999/- NET PROFIT EARNED @20% OF RS. 27,00,0 000/-. ITA NOS. 192 & 193/AHD/2013 & ITA 1372/AHD /2013 AND OTHERS . A.YS. 2009- 10 & 2010-11 5 3. THE LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN ESTIMATING NET PROFIT OF RS. 27,00,0000/- ON TOTAL COLLECTION FOR EXTRA W ORK DURING THE YEAR OF RS. 50,01,200/-. 4. THE APPELLANT CRAVES LIBERTY TO ADD, AMEND, ALTE R OR MODIFY ALL OR ANY GROUNDS BEFORE FINAL HEARING. 10. SO FAR GROUND NOS. 1 & 2 ARE CONCERNED IN CONNECTED IT(SS)A NO. 199/AHD/2013 AFTER FOLLOWING THE CO-ORDINATE BENCH ORDER, WE RESTRICTED THE PROFIT OF ASSESSEE @ 20%. THEREFORE IN PARITY WITH THE ABOVE SAID APPEAL, WE ALLOW THE APPEAL OF THE ASSESSEE. 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 29- 03- 2019 SD/- SD/- (PRADIP KUMAR KEDIA) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 29 /03/2019 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD