Loading judgment…
Facts
The assessee filed seven appeals against the common order of CIT(A) for AY 2009-10 to 2015-16, arising from proceedings under section 153A/143(3). The core issue was the rejection of the assessee's books and estimation of turnover by the lower authorities. A search conducted on the "Shakti Bhog" group of cases led to these proceedings.
Held
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
Key Issues
Whether the rejection of the assessee's books and estimation of GP by the lower authorities was justified, and if not, what would be the appropriate GP estimation.
Sections Cited
153A, 143(3), 143(3), 1961
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘F’, NEW DELHI
Before: Sh. Satbeer Singh Godara & Sh. Naveen Chandra
ORDER Per Bench: These assessee’s seven appeals to 2138/Del/2019 for Assessment Years 2009-10 to 2015-16 arise against the CIT(A)-29, New Delhi’s common order dated 22.10.2018 in case Nos. 167, 170, 171, 175, 177, 182 & 211/2017-18/CIT(A)-29, in proceedings u/s 153A/143(3) and 143(3) of the Income Tax Act, 1961 (in short “the Act”), respectively.
Heard both the parties at length. Case files perused.
It emerges during the course of hearing with the able assistance coming from both the parties that the assessee inter alia raises it’s identical sole substantive ground challenging both the learned lower authorities’ respective assessment and lower appellate findings rejecting it’s books thereby assessing the corresponding turnover @2.25% GP all along.
This is what leaves the assessee aggrieved who has filed all these seven appeals to 2138/Del/2019 before the tribunal.
We have given our thoughtful consideration to the assessee’s and the Revenue’s vehement respective stands against and in support of the impugned rejection of books followed by GP estimation in it’s case @ 2.25%. The Revenue’s case more particularly is that the learned departmental authorities had carried out the search in issue on 20.03.2015 in M/s Shakti Bhog group of cases leading to initiation of section 153A proceedings herein which finally culminated in the impugned assessment rejecting it’s sales/purchase turnover and further estimated the same @ 2.25%. We thus treat A.Y. 2009- 10 as the “lead” assessment year since involving identical set of facts and noticed that both the learned lower authorities have not even indicated in their respective assessment and lower appellate discussion as to whether the corresponding thirty entities had acted as the assessee’s supplier(s) or purchaser(s); as the case may be. Nor they have verified the corresponding turnover(s) in each and every such an instance. The facts also remains that the assessee appears to have not successfully proved it’s turnover to the very effect to the entire satisfaction of the learned lower authorities. There is further no denial to the fact that the learned lower authorities have reduced the alleged “bogus” transactions from the admitted turnover and estimated GP qua the latter figures only than having proceeded qua the sales/purchases in dispute. They have rather ended up in re-estimating assessee’s GP only as genuine transactions. We are of the considered view in this factual backdrop and in the larger interest of justice that a lump sum GP estimation @1.5% of the assessee’s alleged fictitious sales and debit entries than it’s entire turnover in all these assessment years, shall be just and proper in the assessee’s with a rider that the same shall not be treated as a precedent. Necessary computation shall follow as per law.
No other ground or argument has been pressed.