SHRI HARI PRAKASH GOKULKA,SIKAR vs. INCOME TAX OFFICER, WARD, NEEM KA THANA

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR Jh Hkkxpan] ys[kk lnL; ,oa Jh dqy Hkkjr] U;kf;d lnL; ds le{k BEFORE: SHRI BHAGCHAND, AM & SHRI KUL BHARAT, JM vk;dj vihy la-@ITA No. 724/JP/2017 fu/kZkj.k o"kZ@Assessment Year : 2012-13 cuke Hari Prakash Gokulka, Income Tax Officer, Vs. Prop.- M/s Hari Om Ward- Neem Ka Thana. Enterprises, Anaj Mandi, Srimadhopur, Sikar (Raj) LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ACFPG 0451 L vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Satish Kumar Gupta, (CA) jktLo dh vksj ls@ Revenue by : Smt. Poonam Roy (DCIT) lquokbZ dh rkjh[k@ Date of Hearing : 09/04/2018 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 10/04/2018 vkns'k@ ORDER

PER: KUL BHARAT, J.M.

This is an appeal filed by the assessee against the order dated

07/08/2017 passed by the ld. CIT(A)-3, Jaipur for the A.Y. 2012-13. The

grounds taken by the assessee in appeal are as under:- “1. On the facts and circumstances of the case and law, ld. lower authorities grossly erred in rejecting the books of account by invoking the provisions of section 145(3) of the Income Tax Act, 1961. 2. On the facts and circumstances of the case, ld. CIT(A) grossly erred in applying G.P. rate of @ 1.40% as against declared G.P.

ITA 724/JP/2017_ 2 Hari Prakash Gokulka Vs ITO

rate of 1.13% and thereby making and confirming addition of Rs. 6,31,040/- in the trading results. 3. On the facts and circumstances of the case, ld. lower authorities grossly erred in making and confirming lump sum disallowance of 10% is Paldari expenses, car expenses, telephone expenses, travelling expenses and shop expenses without specifying any unvouched/personal expenses.”

was picked up for scrutiny assessment and the assessment U/s 143(3) of

the Income Tax Act, 1961 (hereinafter referred as the Act) was framed

vide order dated 04/12/2014. While framing the assessment, the A.O.

rejected the books of account of the assessee and estimated the G.P. rate

@ 1.50% thereby he made addition of Rs. 8,50,071/-. The Assessing

Officer also further made other ad hoc disallowances in respect of car

expenses, telephone expenses, travelling expenses and shop expenses.

preferred appeal before the ld. CIT(A), who after considering the

submissions, restricted the G.P. rate @ 1.40% and also confirmed the

disallowances related to the other expenses @ 10%. Thus, the ld. CIT(A)

partly allowed the appeal of the assessee.

before the ITAT. Grounds No. 1 and 2 of the appeal are against restricting

ITA 724/JP/2017_ 3 Hari Prakash Gokulka Vs ITO

the G.P. rate @ 1.40% and rejection of books of account. The ld AR of

the assessee vehemently argued that the authorities below were not

justified in rejecting the books of account. The books of account have

been rejected on the basis of whims and fancies. The ld AR further

submitted that the assessee had furnished all details required by the

Assessing Officer. Therefore, he prayed to allow the appeal.

the assessee. She has submitted that the Assessing Officer has noticed

that the assessee was not maintaining stock register and quality wise

details. Further it was noticed by the Assessing Officer that the G.P. of the

assessee has gone down in comparison to the last year. So these were

the sufficient ground for rejection of books of account.

the material available on the record and also gone through the orders of

the authorities below. After considering the totality of the facts and

material placed before the Bench, we are of the considered view that the

ld. CIT(A) has erred in adopting the G.P. rate @ 1.40%. The law is well

settled by the decision of the Hon’ble Jurisdictional High Court that the

past history is the best indicator where the books of account are rejected

and the profit is required to be estimated by the Assessing Officer. It is

ITA 724/JP/2017_ 4 Hari Prakash Gokulka Vs ITO contended by the ld. counsel for the assessee that if the past history of

the last four years is adopted, the average of the same would be lesser

than what the assessee has declared, therefore, we deem it proper to

adopt the G.P. rate @ 1.20% and we direct accordingly to the Assessing

Officer. Hence, grounds No. 1 and 2 of the appeal are disposed off in

terms of the finding hereinabove.

disallowance of 10% in various expenses. We have heard both the sides

on this issue and find that the ld. CIT(A) has rightly restricted the

disallowances @ 10% of the expenses under the various heads which

does not require any interference. Hence, this ground of assessee’s

appeal is dismissed.

Order pronounced in the open court on 10/04/2018. Sd/- Sd/- ¼Hkkxpan½ ¼dqy Hkkjr½ (BHAGCHAND) (Kul Bharat) ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 10th April, 2018 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Hari Prakash Gokulka, Sikar. 1. izR;FkhZ@ The Respondent- The ITO, Ward- Neem Ka Thana 2.

ITA 724/JP/2017_ 5 Hari Prakash Gokulka Vs ITO 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. 724/JP/2017) 6. vkns'kkuqlkj@ By order,

सहायक पंजीकार@Aेेज. त्महपेजतंत