Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, BENCH “C-SMC” KOLKATA
Before: Shri Rajpal Yadav, Hon’ble(KZ) & Shri Manish Borad,Hon’ble
आदेश /O R D E R PER MANISH BORAD, AM.
This appeal filed by the assessee pertaining to the Assessment Year ( in short “AY”) 2007-08 is directed against the order dt. 24-09- 2018 passed by the ld. Commissioner of Income-tax, Appeals [ in short, hereafter referred to as ‘the ‘ld. CIT(A), 14, Kolkata, which is arisen from the assessment order framed u/s. 143(3)/147/263 of the Income-tax Act, 1961 (hereinafter referred to as the ‘Act’) dated 12.06.2014 by the DCIT, Circle-47, Kolkata. 1. Asit Baran Roy
The assessee has raised the following common grounds of appeal for the AY 2007-08:-
FOR THAT in the instant case the reason recorded for reopening is bad in law as the notice of reopening has no legs to stand and the edifice built on the basis of such invalid notice must fall.
2. FOR THAT Ld. CJT(A) was not justified in not dealing with the points of law in proper perspective and he has not correctly appreciated the appellant's arguments on legality of the proceedings. 3. FOR THAT the assumption of jurisdiction to reassess the case is bad in law in view of various legal pronouncement and settled principles of law. 4. FOR THAT in any event, the addition sustained by the Ld. CIT(A) of Rs 1,23,794/ on the basis of gross profit ratio on difference of stock is liable to be struck down in appeal." 3. The present appeal was posted on board on 08/04/2019. Thereafter, it was once dismissed for want of prosecution. However, on the miscellaneous application of the assessee it was restored to its original number. During the last three year, it has been listed for more than twenty times for hearing. In the past it was brought to our notice that appellant has expired on 4th March, 2021. Hearing has been adjourned from time to time for enabling the alias to implead themselves in place of the deceased assessee as appellant. However, neither the legal heirs have filed an application for impleading them as appellants nor the Assessing Officer has brought the legal heirs on record. There might be a host of reasons for this. If the legal representatives can be charged to taxes only from the assets inherited by them as contemplated in Section 159(2) of the Act. There might be no asset for their inheritance and, therefore, they might not be interested in prosecuting the litigation before this Tribunal. We fail to understand the inaction at the end of the AO but it 2. Asit Baran Roy is a Single Member case appeal of 2018 which is, by all means, an old appeal in the Tribunal.
It is pertinent to observe that Rule 26 of the ITAT Rules, 1963 provides a procedure for dealing with cases where the death of a party or insolvency has taken place. For the facility of reference, we take note of this Rule which reads as under:- “26. Continuation of proceedings after the death or adjudication of a party to the appeal.- Where an assesses whether he be the appellant or the respondent to an appeal dies or is adjudicated insolvent or in the case of a company is being wound-up, the appeal shall not abate and may, if the assessee was the appellant, be continued by, and if he was the respondent be continued against, the executor, administrator or other legal representative of the assessee or by or against the assignee, receiver or liquidator, as the case may be.”
A perusal of this Rule would indicate that even after the death of any party, namely, the appellant, the appeal would not abate. Rather it has to be decided on merit. Faced with the above situation, we proceed to decide this appeal ex-parte qua the assessee on merits.
We have heard the ld. DR and perused the material placed on record before us. Though the assessee has raised four (4) grounds of appeal, but the main grievance is only towards addition of Rs. 1,23,794/- made by the AO by rejecting the books results and estimating the profit on turnover declared by the assessee.
7. We note that the assessee is engaged in the business of manufacturer cum Re-seller of H.T & L.T Line materials. It declared its income at Rs. 9,47,973/- in the return of income filed for the AY 2007- 3. Asit Baran Roy 08 on 02-11-2007. A survey was conducted u/s. 133A of the Act on 23-05-2007. The ld. AO noticed that there was an escapement of income to the tune of Rs.16,000/- on the ground of unregistered sale and difference of Rs.52.027/- between the amount of income committed vis-à-vis amount of income declared. The case was re- opened by issuance of notice u/s. 148 of the Act. In the course of assessment proceedings the ld. AO observed that there was miss- match of figures between opening inventory and sales figure. It was submitted by the assessee that inadvertently there was some calculation mistakes, but there is no impact on the trading result of the concern and requested to accept the correct figure of sales and inventory. However, the ld. AO for this small reason rejected the book result and estimated the profit for addition. The ld. CIT(A) further confirmed this addition.
8. We are of the considered view that for mis-match of figure of sales and inventory was duly replied by the assessee giving reconciliation of the sales figure and inventory value. The ld. AO without pointing out any error in such reconciliation nor pointing out any other mistake in the audited book result rejected the same. We, therefore, in the given facts and circumstances, find no merit in this action of the ld. CIT(A) confirming the action of the ld. AO rejecting the book results without assigning any plausible reason. We, therefore, reverse the finding of ld. CIT(A) and delete the addition of estimated profit of Rs.1,23,794/- made in the hands of the assessee. All the grounds raised by the assessee are allowed.
In the result, the appeal of the assessee is allowed.