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Income Tax Appellate Tribunal, JAIPUR BENCHES (SMC
Before: SHRI RAMESH C SHARMAvk;dj vihy la-@ITA No. 1296/JP/2018
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR Jh jes'k lh 'kekZ] ys[kk lnL; ds le{k BEFORE: SHRI RAMESH C SHARMA, ACCOUNTANT MEMBER vk;dj vihy la-@ITA No. 1296/JP/2018 fu/kZkj.k o"kZ@Assessment Year : 2015-16 cuke Shri Gopal Mundra, I.T.O., Vs. 101, Krishna Kripa, Subhash Ward 4(1), Nagar Shopping Centre, Jaipur. Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AINPM 6185 D vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri S.L. Poddar (Adv) jktLo dh vksj ls@ Revenue by : Ms. Anuradha (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 18/03/2019 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 02/04/2019 vkns'k@ ORDER PER: R.C. SHARMA, A.M. This is an appeal filed by the assessee against the order of ld.CIT(A), Ajmer dated 25/10/2018 for the A.Y. 2015-16 in the matter of order passed U/s 143(3) of the Income Tax Act, 1961 (in short the Act).
In this appeal, the assessee is aggrieved for trading addition so upheld by the ld. CIT(A) by applying higher N.P. rate on the enhanced turnover of assessee. The assessee is also aggrieved for upholding the part of the addition made U/s 69 of the Act amounting to Rs. 6,14,531/-.
ITA 1296/JP/2018 2 Gopal Mundra Vs ITO
Rival contentions have been heard and record perused. The facts in brief are that the assessee derives income from retail business of papad, mangodi, spices etc. The return of income was filed disclosing gross profit of Rs. 12,27,950/- and net profit of Rs. 6,53,731/- on total sales of Rs. 1,47,44,698/- declaring net profit rate of 4.43%. During the course of assessment proceedings, the Assessing Officer found that the assessee had maintained following five bank accounts:
City Union Bank 2. Bank of Baroda 3. PNB 4. SBI 5. ICICI Bank The AO has given the finding that the appellant had not disclosed the hank accounts maintained with PNB, SBI AND ICICI Bank Ltd. in the books of accounts. Hence he treated the entire credit of Rs.1,34,47,619/- appearing in these three bank accounts as undisclosed turnover of the appellant and worked out the total turnover of the appellant at Rs. 2,81,92,317/- (Rs. 1,47,44,698 + Rs. 1,34,47,619) and net profit @8.33% was computed on the total turnover of Rs. 2,81,92,317/- at Rs. 23,48,420/-.
By the impugned order, the ld. CIT(A) given credit of Rs. 80,90,350/- which he found that the cash was withdrawn by the ITA 1296/JP/2018 3 Gopal Mundra Vs ITO assessee from one bank account and deposited in another bank account.
As per the ld. CIT(A), it is not a part of sale but merely deposit of cash withdrawn from the bank account. However, the ld. CIT(A) has not accepted the assessee’s contention with regard to deposit of cash in the bank account out of realization of old debtors in so far as the assessee has not furnished any details of debtors as on 31/3/2014 alongwith the return filed for the A.Y. 2014-15. I found that in the earlier year, the assessee had shown the turnover of Rs. 60,43,444/- and return was filed under presumptive tax scheme wherein no details of debtors, creditors, stock etc. was given. Under these facts and circumstances it is reasonable to presume that looking to the nature of the assessee’s business, two months sales remained outstanding in the form of debtors.
Accordingly we direct the Assessing Officer to give further credit of Rs. 10.00 lacs while upholding the addition on account of enhanced sale. I mean that out of enhanced sales as upheld by the ld. CIT(A), a further credit of Rs. 10.00 lacs is required to be given and on the balance, the Assessing Officer is to estimate the profit. Looking to the nature of the assessee trade, estimation of net profit @ 6% as against N.P. disclosed by the assessee @ 4.43% will be reasonable without given any reason the Assessing Officer has applied NP rate of 8.33% which was offered by ITA 1296/JP/2018 4 Gopal Mundra Vs ITO the assessee on the sales of Rs. 60,43,444/- in the year ending on 31/3/2014. During the year under consideration the turnover of assessee has increased substantially which is possible at a sacrifice of some margin profit rate. Thus, there is no justification for applying the NP rate at 8.33% of earlier year wherein the assessee has filed return U/s 44AD of the Act. Accordingly the Assessing Officer is directed to recompute the addition by applying 6% NP rate on the turnover suggested by me hereinabove.
The Assessing Officer has also made addition U/s 69 of the Act with respect to stock in trade amount to Rs. 19,09,611/- and cash balance of Rs. 62,730/- on the plea that the assessee has not filed any details of such stock and cash in hand in its return of earlier year. By the impugned order, the ld. CIT(A) had given credit of Rs. 13,57,810/- by observing that the assessee had shown closing stock with the VAT return and the VAT department has accepted the return filed by the assessee wherein closing stock was shown at Rs. 13,57,810/-. Thus, there is no reason to give any further relief to the assessee in respect of closing stock. I found that the ld. CIT(A) has also accepted the cash balance of Rs. 62,730/-. Accordingly, ground No. 2 raised by the assessee is dismissed.
ITA 1296/JP/2018 5 Gopal Mundra Vs ITO 6. In the result, appeal of the assessee is allowed in part.
Order pronounced in the open court on 2nd April, 2019
Sd/- ¼jes'k lh 'kekZ½ (RAMESH C SHARMA) ys[kk lnL;@ ys[kk lnL;@Accountant Member ys[kk lnL;@ ys[kk lnL;@ Tk;iqj@Jaipur fnukad@Dated:- 2nd April, 2019 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Gopal Mundra, Jaipur. 1. izR;FkhZ@ The Respondent- The I.T.O., Ward 4(1), Jaipur. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 1296/JP/2018) 6. vkns'kkuqlkj@ By order,
सहायक पंजीकार@Aेेज. त्महपेजतंत