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Income Tax Appellate Tribunal, JAIPUR BENCHES, JAIPUR
Before: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, AM vk;dj vihy la-@ITA No. 580/JP/2013
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR Jh fot; iky jko] U;kf;d lnL; ,oa Jh Hkkxpan] ys[kk lnL; ds le{k BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, AM vk;dj vihy la-@ITA No. 580/JP/2013 fu/kZkj.k o"kZ@Assessment Year: 2009-10 cuke Assistant Commissioner M/s Shiv Edibles Ltd., Vs. of Income Tax, 237-A, Talwandi, Circle-1, Kota. Kota. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AAICS 0274 K vihykFkhZ@Appellant izR;FkhZ@Respondent jktLo dh vksj ls@ Revenue by : Smt. Neena Jeph (JCIT) fu/kZkfjrh dh vksj ls@ Assessee by : Shri Mahendra Gargieya (Adv) lquokbZ dh rkjh[k@ Date of Hearing : 20/02/2018 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 26/02/2018 vkns'k@ ORDER
PER: BHAGCHAND, A.M.
This is an appeal filed by the revenue emanates from the order of
the ld. CIT(A), Kota dated 21/03/2013 for the A.Y. 2009-10, wherein the
revenue has taken following grounds of appeal: “On the facts and in the circumstances of the case, the ld. CIT(A) has erred in:- (i) holding that the A.O. was not justified in rejecting books of account and estimating profit without pointing out any specific effect; (ii) deleting the trading addition of Rs. 30,21,370/- by adopting GP rate of 4.9%, which was agreed to by the assessee during the course of assessment proceedings.”
ITA 580/JP/2013_ 2 ACIT Vs. M/s Shiv Edibles Ltd.
(iii) deleting the addition of Rs. 7,37,336/- made by the A.O. U/s 14A r.w. Rule 8D.”
The assessee company is engaged in extraction and refining of
soyaben and mustered oil. The return of income was filed on 30/09/2009
declaring total income of Rs. 8,83,52,180/-. The case was selected for
scrutiny. The Assessing Officer has finalized the assessment U/s 143(3)
of the Income Tax Act, 1961 (in short the Act) on 22/12/2011 at total
income of Rs. 9,16,10,710/- by making various additions. The ld. CIT(A)
has allowed the appeal of the assessee.
Both the grounds of appeal are interlinked and the issue involved
is deleting the trading addition of Rs. 30,21,370/- made by the Assessing
Officer after rejection of books of accounts. The ld. CIT(A) has allowed
this ground of appeal by holding as under:
“I have verified the details and it was seen that assessee has maintained complete details of stock. The yield and shortage was also found to be in acceptable range. The Assessing Officer made the addition without pointing out any specific defect. I also found that there was drop in price of oil products and the same was reason for drop in G.P. Considering the above the Assessing Officer was not justified in rejecting books of accounts and estimating profit. The Assessing Officer is directed to delete the addition of Rs. 30,21,370/-. This ground of appeal is, therefore, allowed.”
ITA 580/JP/2013_ 3 ACIT Vs. M/s Shiv Edibles Ltd.
Now the revenue is in appeal before the ITAT. The ld. DR has
relied on the order of the Assessing Officer. On the contrary, the ld AR of
the assessee has reiterated the arguments as made before the ld. CIT(A)
and prayed to dismiss the appeal of revenue.
After hearing both the sides, the Bench find that the books of
account of the assessee were rejected on account of various
discrepancies noted by the Assessing Officer on account of shortage,
valuation of closing stock and on account of low yield. The Assessing
Officer has also clearly noted that the certain expenses has been
increased disproportionately in relation to increase in turn over for
example, packing material expenses were of Rs. 9,78,779/- in the A.Y.
2008-09, the same have been increased to 53,96,886/-. There was no
closing stock of packing material. The turnover for A.Y. 2008-09 was
more than 262 crores while the turnover for the year under consideration
was around 300 crores. Thus, the increase in the expenditure on packing
material is definitely disproportionate and the same have not been
explained by the assessee. Further there is vast difference in the rate of
opening stock, sales and closing stock. Such differences have been
categorized as under:
Qty. shown as Rate difference Total difference per cl. Stock per kg. (Kg)
ITA 580/JP/2013_ 4 ACIT Vs. M/s Shiv Edibles Ltd. Refined oil 419602 13.17 55,26,158 Crude oil 398051 13.41 53,37,863 Mustered oil 251129 11.21 28,15,156 The assessee has not explained this difference with cogent reasons.
Therefore, all these facts clearly establish that the book result declared
by the assessee were not reliable. The ld. CIT(A) without giving finding
on these various specific discrepancies noticed by the Assessing Officer
has simply deleted the addition, therefore, the findings of the ld. CIT(A)
are perverse. We set aside the order of the ld. CIT(A) and sustain the
order of the Assessing Officer.
In the result, the appeal of the revenue stands allowed.
Order pronounced in the open court on 26/02/2018.
Sd/- Sd/- ¼fot; iky jko fot; iky jko fot; iky jko½ fot; iky jko ¼Hkkxpan Hkkxpan Hkkxpan½ ½ ½ ½ Hkkxpan (VIJAY PAL RAO) (BHAGCHAND) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 26th February, 2018 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- The ACIT, Circle-1, Kota. 1. izR;FkhZ@ The Respondent- M/s Shiv Edibles Ltd., Kota. 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. 580/JP/2013) 6. vkns'kkuqlkj@ By order,
सहायक पंजीकार@Aेेज. त्महपेजतंत