ACIT, CIRCLE - 1, Rajahmundry V. Kavivarapu Venu, Rajahmundry

MA 18/VIZ/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3978 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 11 month(s) 23 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-03-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 09-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V RAMA MOHAN
• Keywords: Gross profit estimation; Corroborative evidences; Tax effect
• Section: 201

Judgement Text

M.A. NO. 18/VIZ/ 2018 ( KAVIVARAPU VENU ) 1 IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , ACCOUNTANT MEMBER M.A.NO. 18/VIZ/2018 ( ARISING OUT OF I . T .A.NO. 658 /VIZ / 201 3 ) ( ASSESSMENT YEAR : 2007 - 08 ) ACIT , CIRCLE - 1(1), RAJAHMUNDRY. VS. KAVIVARAPU VENU, PROP. : V.L.N. TRANSPORT, C - I, BHAGYODAYA APARTMENTS, VIDYANAGAR, RAJAHMUNDRY. [ PAN: AIBPK 3127 F ] ( APPELLANT) ( RESPONDENT ) ASSESSEE BY : NONE DEPARTMENT BY : SHRI V.RAMA MOHAN SR. DR DATE OF HEARING : 28 / 0 2 /201 9 DATE OF P RONOUNCEMENT : 02 / 02 /201 9 O R D E R PER V. DURGA RAO , JUDICIAL MEMBER : BY THIS MISC. APPLICATION , REVENUE SEEK S RECALL OF THE ORDER PA SSED BY THIS TRIBUNAL IN ITA NO . 658 /VIZ/201 3 BY ORDER DATED 18 /0 2 /201 6 FOR THE ASSESSMENT YEAR 20 07 - 08 . 2. LD . DR HAS SUBMITTED THAT REVENUES APPEAL HAS BEEN DISMISSED BY TH E TRIBUNAL ON THE GROUND THAT TAX EFFECT INVOLVED IN THE APPEAL IS BELOW RS. 10.00 LAKHS , WHICH WAS UNSUCCESSFULLY TESTED BEFORE THE HON'BLE JURISDICTIONAL HIGH COURT , BUT THE FACT REMAINS THAT THE PRESENT CASE FALLS UNDER EXCEPTIONAL CATEGORY AS LAID DOWN IN PARA M.A. NO. 18/VIZ/ 2018 ( KAVIVARAPU VENU ) 2 8(C) OF CBDT CIRCULAR NO. 21/2015, DATED 10/12/2015 , THEREFORE REQUESTED TO RECALL THE ORDER AND RE - ADJUD I C A TE THE SAME AFRESH. 3. WE HAVE HEARD LD.DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE GROUNDS RAISED BY THE DEPARTMENT BEFORE THE I TAT ARE REPRODUCED AS UNDER: - 1. THE CIT(A) ERRED BOTH ON FACTS AND IN LAW. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) ERRED IN DELETING THE ADDITION OF RS. 25,70,961/ - WITH A SIMPL E REASON THAT THERE IS NO LEGAL BASIS FOR THE IMPUGN ED ADDITION. CIT(A) OUT TO HAVE OBSERVED THE FACT THAT THE ASSESSEE IS ONLY THE SOLE PROPRIETOR FOR THE TWO CONCERNS I.E. 1) V.L.N. TRANSPORT & 2) VASANTHA LAKSHMI TRANSPORT AND THE NATURE AND TRADE ARE ONE AND THE SAME COUPLED WITH AREA OF OPERATION, THE FINANCIAL RESULTS FOR BOTH THE CONCERNS SHOULD BE ALIKE. PERCENTAGE OF GROSS PROFIT IN VASANTHA LAKSHMI TRANSPORT IS 14.66% WHEREIN IN VLN TRANSPORT IT IS SHOWN AT 2.59% ONLY. 3. THE CIT(A) ERRED IN EVALUATING THE DIFFERENCE OF PERCENTAGE IN BOTH THE TRA NSPORTS I.E. 12.07% WHICH IS HUGE DIFFERENCE IN THE SAME LINE OF BUSINESS WITH A SIMPLE REASON THAT ONE TRANSPORT ENTITY IS TRANSPORTING THE MATERIAL FROM SUPPLIERS TO MANUFACTURERS WHEREAS THE OTHER IS TRANSPORTING THE MANUFACTURED PRODUCT FROM THE MANUFA CTURER TO THE CUSTOMERS. 4. THE CIT(A) HAS ERRED IN DELETING THE ADDITION WITHOUT CONSIDERING THE LOW GROSS PROFIT AND NET PROFIT CLAIMED BY THE ASSESSEE FOR THE FIRST TIME THAT TOO WITHOUT ANY SUPPORTING EVIDENCE AND MADE WILD SUBMISSIONS STATING THAT MOS T OF THE PAYMENTS ARE MADE DIRECTLY TO THE TRUCK OPERATORS. 5. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF APPEAL HEARING. FROM THE ABOVE, IT IS VERY CLEAR THAT THE DEPARTMENT HAS NOT RAISED EXCEPTION TO CBDT CIRCULAR NO. 21/2015, DATED 10/12/2015 AND EVEN IT IS NOT SUBMITTED AT THE TIME OF HEARING. THEREFORE, THE ITAT HAS DISMISSED THE APPEAL OF THE DEPARTMENT BY FOLLOWING THE ABOVE CBDT CIRCULAR. SUBSEQUENTLY , THE DEPARTMENT CARRIED THE M.A. NO. 18/VIZ/ 2018 ( KAVIVARAPU VENU ) 3 MATTER IN APPEAL BEFORE THE HON'BLE HIGH COURT AND THE HON 'BLE HIGH COURT ALSO DISMISSED THE APPEAL. UNDER THESE CIRCUMSTA N CES , THE DEPARTMENT OUGHT NOT TO FILE AGAIN M.A. BEFORE THE TRIBUNAL. BE THAT AS IT MAY, THERE IS NO MISTAKE APPARENT ON RECORD BY THE TRIBUNAL IN ITA NO.658/VIZ/2018, DATED 18/02/2016. THE REFORE, THIS MISC. APPLICATION FILED BY THE REVENUE IS DISMISSED. O RDER PRONOUNCED IN THE OPEN COURT ON 02 ND MARCH , 20 20 S D/ - SD/ - ( D.S. SUNDER SINGH) (V. DURGA RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 02 / 0 3 /20 20 VR /SPS COPY OF THE ORDER FORWARDED TO : - 1. THE APPELLANT KAVIVARAPU VENU, PROP. : V.L.N. TRANSPORT, C - I, BHAGYODAYA APARTMENTS, VIDYANAGAR, RAJAHMUNDRY. 2. THE RESPONDENT ACIT, CIRCE - 1 (1), RAJAHMUN DRY . 3. THE CIT, RAJAHMUNDRY . 4. THE CIT(A), VISAKHAPATNAM. 5. DR, ITAT, VISAKHAPATNAM 6. GUARD FILE BY ORDER // TRUE COPY // SR.PRIVATE SECRETARY ITAT, VISAKHAPATNAM