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Income Tax Appellate Tribunal, “GAUHATI” BENCH, KOLKATA
Before: HON’BLE SHRI PARTHA SARATHY CHAUDHURY, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
आदेश / O R D E R
Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2012-13 arises out of the order the Ld. Commissioner of Income Tax (Appeals), Guwahati-1 [Ld. CIT(A)] dated 29/11/2019 in the matter of assessment framed by the Ld.AO u/s. 143(3) of the Income-tax Act, 1961 on 13/03/2015. 2. The registry has noted a delay of 11 days in the appeal, the condonation of which has been sought by the assessee on the strength of condonation petition which is supported by the affidavit of the assessee. The delay has been attributed to adverse medical conditions
being faced by the assessee. Keeping in view the period of delay, we condone the same and admit the appeal for adjudication on merits. 3. The Ld. AR, drawing attention to the documents placed in the paper-book, submitted that the assessee was eligible to claim exemption u/s 10(26) since the assessee had furnished certificate of residence and caste certificate. The provisions of Section 10(26) provide exemption to income of a member of a Scheduled Tribe residing in specified area and the exemption is available in respect of income which accrues/arises from any source in such areas or income by way of dividends/interest on securities arises from any area. The Ld. AR also submitted that the books of accounts could not be produced since the same were misplaced during shifting from one place to another place. On the other hand, Ld. Sr. DR submitted that the assessee did not furnish evidences in support of the claim. Having heard rival submissions, our adjudication would be as under. 4. The assessee was assessed u/s 143(3) on 13/03/2015 wherein the assessee was directed to substantiate the exemption claimed u/s 10(26). The assessee is stated to be Scheduled Tribe resident of Tangla Town under Harisinga revenue circle, P.S Tangla in the district of Udalguri of Bodoland Territorial Council, Assam and is stated to be engaged in civil contract work and sale supply business. The assessee reflected civil work contract receipts of Rs.15.98 Crores and supply sale for Rs.1.58 Crores. However, as per information available in Form 26AS, the contract receipts were only Rs.5.67 Crores and thus there was difference of Rs.10.30 Crores which assessee was required to explain with documentary evidences and the place where the work was executed. However, the assessee expressed inability to produce books of accounts
by submitting that the books got misplaced while shifting business office from Bhergaon to Tangla. The assessee could submit bank account details, work order, ST certificate and residential certificates etc. and claimed that the entire work was performed in specified area only. However, after analyzing bank accounts, Ld. AO rejected assessee’s submissions and formed an opinion that the assessee failed to prove that the work was executed in the specified area only. Finally, Ld. AO estimated profit of 1.69% on differential receipts of Rs.10.30 Crores and added the same to the income of the assessee. 5. During appellate proceedings, the assessee maintained that the work was carried out only in specified area and also furnished few work order agreement in respect of sub-contract in exempted areas obtained from private parties. The assessee also submitted financial statements and Tax Audit Report etc. towards the claim. The Ld. CIT(A), after considering assessee’s submissions, issued enhancement notice since the details furnished by the assessee were found to be insufficient to support the claim of the assessee. However, the assessee failed to submit requisite documents / information. As per assessee’s submissions, the differential of Rs.10.30 Crores arose out of sale of hardware items and not from civil work. The conduct of the assessee remained non-compliant and evasive and no material was adduced against enhancement notice. Therefore, for want of sufficient evidences, entire differential of Rs.10.30 Crores was to be added to the income of the assessee. Accordingly, the assessment was enhanced by Ld. CIT(A) to Rs.10.30 Crores. Aggrieved, the assessee is in further appeal before us.
Upon careful consideration, we find that it is undisputed fact that the assessee is entitled for certain exemption u/s 10(26). However, the initial onus would be on assessee to substantiate that the prescribed conditions of Sec. 10(26) were fulfilled and requisite details / evidences thereof were maintained as well as furnished to the lower authorities. However, we find that the assessee has failed to furnish the same despite the fact that the books of accounts were duly audited under law and all the details would be available with assessee’s Tax Auditor. The assessee failed to respond to various notices issued during assessment proceedings as well as during appellate proceedings and the notices remained un-responded / un-complied with. Under such circumstances, the lower authorities were left with no option but to estimate the income of the assessee. Keeping in view the submissions made by Ld. AR and documents placed before us in the paper-book, we find that impugned order is not sustainable since the turnover could not be considered to be assessee’s income. Therefore, we deem it fit to set-aside the impugned order and restore the matter back to the file of Ld. AO for fresh adjudication with a direction to the assessee to substantiate its claim with satisfactory documentary evidences. In the event of failure to do so, Ld.AO shall be at liberty to proceed with assessment on the basis of material on record. Resultantly, ground No. 1 to 3 & 5 to 6 stands allowed for statistical purposes. Ground No.4 does not require any specific adjudication since the partial exemption has already been granted to the assessee. Ground No.7 is general in nature.
Finally, the appeal stand partly allowed for statistical purposes. Order pronounced on 08th November, 2021.
Sd/- Sd/- (Partha Sarathi Chaudhury) (Manoj Kumar Aggarwal) �ाियक सद� / Judicial Member लेखा सद� / Accountant Member
Kolkata; िदनांक Dated : 08/11/2021 **Sr.PS, PP
आदेशकी�ितिलिपअ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ�/ The Appellant : Shri Pabitra Boro, Babupara, Ward-03, P.O Tangla, Dist-Udalguri, 784521, Assam. 2. ��थ�/ The Respondent: I.T.O W- Mangaldai, Rahika Bhawan Laxminath Bezbaruah Road-784125, Assam. 3. आयकरआयु�(अपील) / The CIT(A) 4. आयकरआयु�/ CIT– concerned 5. िवभागीय�ितिनिध, आयकरअपीलीयअिधकरण, मुंबई/ DR, ITAT, Guwahati 6. गाड�फाईल / Guard File
आदेशानुसार/ BY ORDER,
उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकरअपीलीयअिधकरण, / ITAT, Kolkata.