Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, KOLKATA ‘SMC’ BENCH, KOLKATA
Before: Sri J. Sudhakar Reddy]
This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals)-14, Kolkata (hereinafter the ‘ld. CIT (A)’), passed u/s 250 of the Income Tax Act, 1961 (the ‘Act’), dt. 28/04/2017, for the Assessment Year 2011-12.
The assessee is an individual and is a dealer of iron & steel. He filed his return of income on 02/05/2012, disclosing total income at Rs.7,39,163/-.
Assessment Year: 2011-12 Kumari Durga Ganpariwaru 2.1. The assessee did not produce the books of account before the Assessing Officer. No bills or documents were produced by the assessee before the Assessing Officer, in support of the return of income. The Assessing Officer concluded that the sale parties and the purchase parties of the assessee are prima facie not genuine. Hence he rejected the audited books of account and after taking three comparable cases estimated the net profit at 0.54 per cent of the turnover.
2.1.1. On appeal, the ld. First Appellate Authority, confirmed the same. Further aggrieved the assessee is before us on the following grounds:- “
1. That on the facts and in the circumstances of the case, the Ld. Commissioner of Income Tax (Appeals)-14, Kolkata, erred in dismissing the Appeal of the Appellant without giving any cogent reasons.
2. That in view of the Annexure to the Form-35 and the fact that the accounts of the Appellant were audited, the Ld. Commissioner of Income-tax (Appeals) ought to have held that the Assessing Officer was not justified in estimating Net Profit of the Appellant @ 54% of the Turnover and thereby confirming the Assessing Officer's determination of the Appellant's non-speculative business income at Rs.13,72,823/-.
3. That on the facts and in the circumstances of the case, the Ld. Commissioner of Income Tax (Appeals) erred in confirming the disallowance of the Appellant's deduction under Chapter VIA of the Act.
3. That the Assessment Order passed by the Ld. Commissioner of Income Tax is bad in law.
4. That the Appellant craves leave to submit further grounds, to amend, alter or otherwise modify the grounds already taken, if necessary, before or at the time of hearing of the Appeal.”
3. Ground No. 1, 3 & 4 are dismissed as not pressed.
The ld. Counsel for the assessee Shri P.J. Bhide, argues that the net profit percentage of 0.54 per cent adopted by the Assessing Officer is arbitrary and excessive. He argues that no opportunity was granted
Assessment Year: 2011-12 Kumari Durga Ganpariwaru by the Assessing Officer to the assessee to examine the comparable cases and thus causing violation of principles of natural justice. He relies on comparative results for the Assessment Years 2011-12 & 2010-11 and submits that the percentage of GP is 0.47 per cent and net profit margin is 0.32 per cent for Assessment Year 2011-12 and 0.12 per cent for Assessment Year 2010-11. He pleads that the same may be adopted. He further argues that the assessment should be set aside and the Assessing Officer to provide opportunity to the assessee to cross- examine the comparable cases.
The ld. DR, submits that the assessee has not produced any evidence, whatsoever, in support of his claim and was dodging and avoiding the Assessing Officer. He submitted that none of the claims of the assessee could be substantiated and not even basic records and books of accounts have been produced before the Assessing Officer. He relied on the order of the Assessing Officer as well as the ld. CIT(A) and submitted that the same be upheld.
After hearing rival contentions, I find that no argument is advanced for controverting the factual finding of the ld. Assessing Officer that the parties to show sales have been made and parties from whom purchases have made as claimed by the assessee are prima facie not genuine. The assessee could not substantiate any of its claims made in the return of income. The ld. Counsel for the assessee could not controvert the finding of the ld. CIT(A) that nothing in the audited books submitted by the assessee were verifiable. Under these circumstances, we see no reason to interfere with the concurrent findings of the revenue authorities. On the issue of natural justice, the Assessment Year: 2011-12 Kumari Durga Ganpariwaru assessee failed to discharge the burden of proof that lay on him. When the accounts produced itself are unverifiable, the claim of the assessee to rely on the same is devoid of merit. Regarding the alternative claim of the assessee that depreciation has to provided, we find strength in the arguments of the ld. DR that Section 44AF of the Act which provides for computation of profit in the case of retail business deems depreciation to have been provided without estimating the income @ 5 per cent of the turnover. The Circular of the Board, dt. 31/08/1965, relied upon by the assessee was much before the introduction of the Section 44AF of the Act, and hence of no avail.
6.1. Similar, is the decision of the Hon’ble Allahabad High Court in the case of Commissioner of Income Tax vs. Bishambhar Dayal and Co.. judgement dt. November 11th, 1993. As the books itself are not reliable and are not verifiable, the claim of the assessee that he has furnished the required particulars for claim of depreciation cannot be accepted. Hence, we uphold the concurrent findings of the Revenue Authorities and dismiss this appeal of the assessee.
In the result, appeal of the assessee is dismissed.