I.T.O WD - 4,NADIA, NADIA vs. ARAVINDA CHANDRA SARKAR, KOLKATA

The Assessee is an individual. He derives income from acting as labour contactor. For A.Y.2009-10 the assessee filed return of income on 01.12.2009 disclosing total

Aggrieved by the aforesaid additions the assessee preferred appeal before the CIT(A). The CIT(A) noticed that as per 26AS amount received from L & T Ltd. Was Rs.1,13,70,746/- whereas the assessee had declared contract receipts of only Rs.81,35,614/-. The CIT(A) in exercise of his powers of enhancement made an addition of 10% of the undisclosed contract receipts of Rs.32,35,132/-(Rs.1,13,10,746/- - 81,35,614/-) resulting in an addition of Rs.3,23,513/- to the total income by way of enhancement.

As far as the disallowance of expenses made by the AO was concerned the CIT(A) held that disallowance of 50% of salaries and wages was excessive and he restricted to 5% of the salaries and wages.

As far as disallowance of power and fuel expenses are concerned in the remand proceedings bills and vouchers were produced and hence disallowance made by the AO under this head was deleted by the CIT(A).

At the time of hearing the ld. Counsel for the assessee filed before us a copy of the order of ITAT in which was an appeal filed by the assessee against the very same order of CIT(A) against which the revenue has preferred the present appeal. In that appeal the assessee had prayed for quashing of the entire assessment order on the ground that no notice u/s 143(2) was served on the assessee. This plea had been raised by the assessee before the CIT(A)but not adjudicated by the CIT(A). The Tribunal by its order dated 13.11.2013 held as follows :- “4. Having regard to the facts of the instant case and the rival but common submissions made before us, we set aside the impugned order and remit the matter to the file of Id. CIT(A) for deciding ground nos.1 and 2 of the assessee's appeal and thereafter, take up the other grounds on merits, if needed. We want to make it clear that no observation made in this order should be construed as rendering any decision on the merits of these two grounds which were not disposed of by the Id. CIT(A). The issue has been thrown open at large before the Id. CIT(A) to decide these grounds as per law after allowing a reasonable opportunity of being heard to the assessee"

The assessee has also in that appeal challenged the action of the CIT(A) in making an addition on account of undisclosed profits by way of enhancement and sustaining disallowance f 5% of salaries and wages. These grounds were also directed to be examined by the Tribunal if it becomes necessary. Since the issues that arises for consideration on remand by Tribunal of assessee’s appeal and the grounds of appeal in this appeal are same, we are of the view that the grounds raised by the revenue in this appeal should also be directed to be considered by CIT(A). We accordingly set aside the order of the CIT(A) and remand the issues raised by the revenue in this appeal before us for fresh consideration along with the issues remanded by the Tribunal in the assessee’s appeal. For statistical purposes the appeal is treated as allowed.