SAVLON SULZ PRIVATE LIMITED,BHILWARA vs. ACIT, CIRCLE, BHILWARA

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ITA 4/JODH/2022Status: DisposedITAT Jodhpur17 October 2023AY 2018-195 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s decision, stating that the turnover of Rs. 69,19,93,355/- exceeded 50 crores, justifying the 30% tax rate. The Tribunal also noted that rectifying this would require recomputing turnover, which is beyond the scope of Section 154.

What were the facts?

The assessee company claimed a lower tax rate of 25% based on turnover less than 50 crores for AY 2018-19. However, the Assessing Officer processed the return at a 30% tax rate, which was confirmed by the CIT(A).

What were the issues?

Whether the lower tax rate of 25% was applicable given the assessee's turnover, and if the rectification under Section 154 was appropriate for this issue.

Which sections of the Income-tax Act were involved?

Section 154

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JODHPUR BENCH, JODHPUR

Before: DR. M. L. MEENA & SH. ANIKESH BANERJEE

Hearing: 16.10.2023Pronounced: 17.10.2023

This captioned appeal has been filed by the assessee against the order of the ld. CIT (A) National Faceless Appeal Centre (NFAC), Delhi dated 09.11.2021 in respect of Assessment Year 2018-19 challenging

2 Savlon Sulz Pvt. Ltd. v. ACIT therein the decision of ld. CIT(A) in confirming the charging of tax rate at 30% on the total income of the appellant as per the rectification order passed u/s 154 of the Act by the DCIT (CPC), Bengaluru dated 28.11.2019.

2.

None appeared for the assessee, however adjournment application was filed by the counsel for the assessee stating therein the reason that he has been pre-occupied, however he has not enclosed any documentary evidences in support. We find no merit in the adjournment application in the absence of any valid reasons and therefore, same is rejected. Accordingly, it was decided to hear the ld. DR and decide the appeal on merits on a small issue of rectification u/s 154.

3.

Briefly, the facts of the case are that the assessee company engaged in the business of manufacturing & trading of synthetic fabrics, and filed its return of income for A.Y. 2018-19 on 26.10.2018 declaring total income of Rs.3,03,00,203/-. The return of income was processed u/s 143(1) or the Act by the DCIT(CPS), Bengaluru determining the total income at Rs.3,07,82,713/- and calculated tax @ 30%. The appellant assessee has claimed that he has turnover less than 50 crores in the financial year 2017- 18, and hence, the tax rate of 25% to be applied which has been rejected by the ld. CIT(A) vide para 11 to 13, as under:

“11. During the appellate proceedings, vide letter dated 31.08.2021 the appellant submitted a copy of form 3CA and form 3CD for A.Y.2018-19 in which it is seen from the Col.No.40 in the details regarding turnover, the gross profit for the previous year and preceding previous year were mentioned as under :

No. Particulars Previous year Preceding previous year a Total turnover of 691993255 666590217 assessee b Gross 93571715 691993355 13.52% 74453807 666590217 11.17% profit/turnover c Net profit/turnover 27517200 691993355 3.98% 17667553 666590217 2.65% d Stock in 28608188 691993355 4.13% 37695860 666590217 5.66% trade/turnover e Material 0 0 0% 0 0 0% consumed/finished goods produced

12.

It is clear from the above column that the turnover of the appellant during the previous year relevant to the A.Y.2018-19 is Rs.69,19,93,355/- which is above Rs.50 Crores. Therefore, the applicable tax rate in respect of the appellant is at 30%for the A.Y.2018-19.

13.

Hence, I have no reason to interfere in the order u/s 154 with regard to this issue on charging of tax rate at 30% on the total income of the appellant.”

4 Savlon Sulz Pvt. Ltd. v. ACIT 4. We have heard the ld. DR, perusal of the record and the impugned order. The undisputed facts on record is that the turnover of the appellant assessee during the previous year relevant to the assessment year 2018- 19 under consideration was Rs.69,19,93,355/- which is more than 50 crores, therefore, the ld. CIT(A) was justified in confirming the applicable tax rate in respect of the appellant assessee @ 30% for the relevant assessment year 2018-19. In our view, the assessee’s claim cannot be considered to be an apparent error on record to exercise the rectification powers u/s 154 of the Act because in the present case to exercise such powers, it would be required to recompute the turnover of the appellant assessee by disproving the turnover shown in column no. 4 of the copy of form 3CA and form 3CD for AY 2018-19. In view of that matter, we do not find any infirmity and perversity in the order of the ld. CIT(A) to the facts on record in confirming the rectification order passed u/s 154 by the Assessing Officer, in rejecting the claim of the appellant.

5.

In the above view, we find no merits and substance in the appeal of the assessee, therefore, the impugned order passed by the ld. CIT(A) is upheld.

Order pronounced in the open court on 17.10.2023

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