M/S ABHOY ENTERPRISES,DALTONGANJ V. ACIT, CIRCLE-1, RANCHI

ITA 339/RAN/2025

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M/S Abhoy Enterprises appealed against the order of the CIT(A) which had dismissed their appeal concerning the assessment year 2015-16. The primary contention was the estimation of profit at 8% by the Assessing Officer, which the appellant argued was excessive and unreasonable, given their disclosed GP of 8.06% and NP of 6.10%. The appellant also contested the classification of interest income from FDs as income from other sources rather than business income. The Tribunal noted the consistency in the profit rate with a previous ITAT decision for the assessment year 2011-12 and found the appellant's declared profit rate reasonable, thus allowing the appeal.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 845699 (ITAT-RANCHI)
• Duration Of Justice: 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Ranchi
• Assessment Year: 2015-2016
• Appeal Filed On: 06-10-2025
• Other Referred Cases: ITA No. 100/RAN/2015
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Condonation of delay; Business income; Rule of consistency; Period of limitation; Time period of passing order
• Section: 143(3)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER ITA No. 339/RAN/2025 (Assessment Year-2015-16) (Virtual Hearing) M/S ABHOY ENTERPRISES, Police Line Road, Sudna, Daltonganj-822101 Jharkhand. PAN No. AACFM3340B Vs. A.C.I.T., Circle-1 Daltonganj Appellant/ Assessee Respondent/ Revenue Assessee represented by Shri Devesh Poddar, A.R. Department represented by Shri Kailash Gautam, Addl. CIT, DR. Date of hearing 29/01/2026 Date of pronouncement 25/03/2026 O R D E R PER: BENCH 1. This appeal was filed by the assessee against the order of the Ld. CIT(A) dated 15.07.2025 for the Assessment Year (AY) 2015-16. The assessee has raised following grounds of appeal: \"1. For that the order passed by Ld CIT(A) is erroneous and bad in law to the extent that Ld CIT(A) has failed to follow the decision of jurisdictional ITAT Bench in case of the assessee itself involving identical facts. As such, CIT(A) ought to have abided by the decision of Hon'ble ITAT. 2. For that the Ld AO was not justified in estimating profit without rejecting the books of the asseessee. I any view of the case, profit estimated @8% is highly excessive and unreasonable. 3. For that Ld CIT(A) was not justified in confirming the addition of interest income as income from other sources. Interest earned on FD's which are kept as security towards business contract is to be taxed as business income. As such, the action of cover authorities is arbitrary and uncalled for. 4. For that other grounds in detail will be argued at the time of hearing..\" Printed from counselvise.com ITA No. 339/RAN/2025 M/S ABHOY ENTERPRISES, Vs A.C.I.T., Circle-1 . 2 2. We found from perusal of the record that there is delay of 20 days in filing this appeal before the Tribunal, for which the assessee has filed an application for condonation of delay mentioning the fact that the delay was caused due to the fact that the CA of the assessee was pre-occupied with filing of the ITR for which the limitation period was 16th September, 2025 and further Tax Audit. The delay was not intentional and not deliberate and prayed to condoned the delay and admit an appeal for hearing. On the other hand the ld. Sr. DR did not raise any serious objection. Therefore, considering the contents made in the condonation petition we decide to condone the delay and admit the appeal. 3. That fact of case, in brief, the assessment order under section 143(3) of the Income Tax Act, 1961 (in short \"the Act\") was passed on 28.11.2017 and following additions were made: - i. Income from contract business (estimated @ 8%) - Rs. 10,49,293/- ii. income from other sources Rs. 27,00,451/-. 4. Aggrieved by the order of learned Assessing Officer, the learned CIT(A), who vide impugned order dismissed the appeal of assessee on the ground that no details/documents were furnished before him. 5. Aggrieved by the order of learned CIT(A), this present appeal preferred before us. 6. During appeal proceeding before us, it was submitted by the learned AR. that this is a case of contractor and the profit rate estimated @ 8% is highly excessive and unreasonable because the assessee is a Government Contractor and working mainly in remote and rural areas and the assessee itself has disclosed a GP of 8.06% and NP of 6.10% which is quite reasonable. The Printed from counselvise.com ITA No. 339/RAN/2025 M/S ABHOY ENTERPRISES, Vs A.C.I.T., Circle-1 . 3 appellant has further submitted that the Hon'ble I.T.A.T., Ranchi has already held in the case of the appellant itself in the assessment year 2011-12 which has been accepted by the Hon'ble I.T.A.T., Ranchi in ITA No. 100/RAN/2015 dated 16.09.2016. Same explanation was submitted before the learned CIT(A) also but he did not accept the submission of the appellant on the ground that the appellant has not produced any documentary evidence to substantiate the income declared by the appellant. 7. The learned CIT Sr. DR., on the other hand, relied on the order of the lower authorities. 8. We have carefully considered the facts of the case and past history of the appellant including the decision of the Hon'ble I.T.A.T., Ranchi in the case of the assessee itself for the assessment year 2011-12 (Supra). Following the rule of consistency and nature of business carried out by the appellant. Net profit rate of 6.10% as declared by the appellant seems to be reasonable. We therefore, hold that the same should be accepted without any variation in the absence of any material or evidence brought out by the lower authorities. Thus, the appeal filed by the appellant is allowed in the above terms. 9. In the result, this appeal of the assessee is allowed. Order Pronounced in open court on 25th March, 2026 Sd/- Sd/- (GEORGE MATHAN) (RATNESH NANDAN SAHAY) JUDICIAL MEMBER ACCOUNTANT MEMBER Ranchi, Dated: 25/03/2026 *Ranjan Copy to: 1. Assessee 2. Revenue Printed from counselvise.com ITA No. 339/RAN/2025 M/S ABHOY ENTERPRISES, Vs A.C.I.T., Circle-1 . 4 3. CIT 4. DR By order 5. Guard File Sr. Private Secretary, ITAT, Ranchi Printed from counselvise.com "