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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
Before: SRI MAHAVIR SINGH
Aayakr ApIla saM./ (inaQa-arNa baYa- / Assessment Year 2008-09) Messrs. Raja Zarda Stores The Income Tax Officer, Ishwar Bhuvan, 206, Brigader Ward-15(3)(1), 106 Matru Vs. Road, Usman Marg, Null Mandir, Tardeo, Bazar, Mumbai-400 003 Mumbai-400 007 .. (p`%yaqaaI- / Respondent) (ApIlaaqaI- / Appellant) स्थायी लेखा िं./PAN No. AACFR2862F अपीलाथी की ओर े / Appellant by : Shri MS Mathuria, AR प्रत्यथी की ओर े / Respondent by : Shri SK Bepari, DR ुनवाई की तारीख / Date of hearing: 25.10.2018 घोषणा की तारीख / Date of pronouncement : 25.10.2018 AadoSa / O R D E R महावीर स िंह, न्याययक दस्य/ PER MAHAVIR SINGH, JM:
This appeal by the assessee is arising out of the order of Commissioner of Income Tax (Appeals)-28, Mumbai [in short CIT(A)], in appeal No. CIT(A)-28/IT-807/ITO-17(3)(1)/2013-14 vide dated 11.12.2017. The Assessment was framed by the Income Tax Officer, Ward 15(3)(1), Mumbai (in short ‘ITO/ AO’) for the A.Y. 2008-09 vide dated 22.03.2013 under section 143(3) read with section 147 of the Income Tax Act, 1961 (hereinafter ‘the Act’).
The only issue in this appeal of assessee is against the order of CIT(A) estimating the net profit rate at 0.25% as against the claim of assessee at 0.16%.
Brief facts are that the assessee is engaged in the trading / distribution of chewing Tobacco. A survey under section 133A of the Act was conducted on the business premises of the assessee on 23.10.2009 and on that basis the assessment was reopened but no material whatsoever was referred while applying net profit rate at 1% of the total sales of ₹ 7,51,74,700/- by the AO. Accordingly, he estimated the net profit at ₹ 7,51,747/-. The assessee has disclosed profit i.e. net profit of ₹ 3,99,629/- i.e. 0.16%. Aggrieved, assessee preferred appeal before CIT(A), who restricted the profit at 0.25% by observing in Para 2.2. as under:-
“2.2 The appellate order in other years filed with written submission were discussed. On facts, AR argued that net profit rate @0.25% would treat the ends of justice. In ITAT, in one year, Net profit went upto 0.22% from 0.09% in earlier year. The appellant got relief because of that. Here facts are different. But 1% rate is too high considering nature of business and past results. Hence Net profit is directed to be taken at 0.25% after rejection of books and no further relief.”
Aggrieved, assessee is in second appeal before Tribunal.
During the course of hearing before me, the learned Counsel for the assessee only requested that as in earlier year ITAT has deleted the entire addition in AY 2010-11 in vide order dated 23.12.2015 in assessee’s own case by observing as under: -
“5. I am of the considered view, that when the cash payment exceeding ₹ 20,000/- is permitted in Rule 6DD, no adverse inference can be drawn on this account. Reading the Debtors issue, I am of the view that if the AO is doubting the quantum of sales, non production of the ledger accounts of debtors and the corresponding bills and confirmations will be relevant but in the present case, the AO is not doubting the quantum of sales because the AO has accepted the turnover of the assessee and his books of accounts are also not rejected and he has simply applied NP rate on the disclosed sales and therefore, no adverse inference can be drawn on any of these two accounts and therefore, in my considered opinion, in the facts of the present case, there is no justifiable reason to make any addition to the income declared by the assessee particularly when GP and NP rates in the present are better when compared with these rates for AY 2009-10 and entire addition made by the AO in AY 209-10 has been deleted by the CIT(A) and no difference in facts could be pointed out by the learned DR in the present year.”
Same are the facts in this year also and respectfully following and taking a consistent view, I also delete the addition and allow the appeal of the assessee.
In the result, the appeal of assessee is allowed.
Order pronounced in the open court on 25-10-2018. AadoSa kI GaaoYaNaa Kulao mao idnaMk 25-10-2018kao kI ga[- .