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Income Tax Appellate Tribunal, MUMBAI BENCHES “A”, MUMBAI
Before: Shri JOGINDER SINGH, & Shri G. MANJUNATHA
आदेश / O R D E R
Per Joginder Singh (Judicial Member) The assessee is aggrieved by the impugned order dated 07/10/2014 of the First Appellate Authority, Mumbai. The grievance of the assessee is with respect to confirming the action of the Assessing Officer by the First Appellate Authority rejecting the books of accounts of the assessee invoking the provisions of section 145(3) of the Income Tax Act, 1961 (hereinafter the Act) without considering the facts and circumstances of the case and further considering the profit of the firm at 10% of the total sales resulting into addition of Rs.35,88,648/- to the total income of the assessee.
During hearing, Shri Jay Shah, ld. counsel for the assessee, advanced arguments, which is identical to the ground raised by contending that the books of the assessee were wrongly rejected invoking the provisions of section 145(3) and the estimation of the profit @ 10% of the M/s Aibani Enterprises total sales is without any justification. On the other hand, Shri Rajesh Kumar Yadav, Ld. DR strongly defended the addition and invocation of section 145(3) of the Act.
2.1. We have considered the rival submissions and perused the material available on record. The facts, in brief, are that the assessee is a partnership firm engaged in the business of building/construction/development, declared income of Rs.45,26,760/- in its return filed on 13/10/2010, declaring the profit @ 5.57% of the total sales. The return was processed u/s 143(1) of the Act.
Later on, notices were issued u/s 133(6) of the Act to various parties, the details of which are available at page-2 of the assessment order. As per the Revenue, no reply was received to the notices. The assessee was conveyed the result of notices vide letter dated 08/02/2013 and the assessee was asked to produce the parties with whom the transactions were claimed to be made along with the copies of the bank statement of such parties. As per the Revenue, assessee could not produce the parties. However, the assessee filed confirmation with respect to three parties and did not file any confirmation with respect to remaining
M/s Aibani Enterprises three parties. The Ld. Assessing Officer rejected the books of accounts u/s 145(3) of the Act, resulting into rejection of declared profit and estimated the profit @ 10% of sales and thus the amount of Rs.35,88,648/- was added to the total income.
2.2. On appeal before the Ld. Commissioner of Income Tax (Appeal), the factual matrix was considered and the addition sustained by the Ld. Assessing Officer was affirmed. The assessee is aggrieved and is in appeal before this Tribunal.
2.3. Before us, the ld. counsel for the assessee, advanced arguments as has been mentioned in earlier paras of this order. The crux of the argument is that the assessee is in a position to produce all the parties as proper opportunity/time was not provided to the assessee during assessment stage. Thus, considering the totality of facts and the circumstances narrated before us, we are of the view that ultimate object of Article-265 of the Constitution of India is to levy and collect due taxes. The assessee is directed to produce all the parties before the Assessing Officer and other necessary evidence, if any, in M/s Aibani Enterprises support of its claim. The Ld. Assessing Officer is directed to examine the claim of the assessee and decide afresh in accordance with law. Thus, the appeal of the assessee is allowed for statistical purposes.
Finally, the appeal of the assessee is allowed for statistical purposes.
This Order was pronounced in the open court in the presence of ld. representatives from both sides at the conclusion of the hearing on 29/01/2018.