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Income Tax Appellate Tribunal, “D” BENCH : KOLKATA
Before: Hon’ble Shri N.V.Vasudevan, JM & Shri M.Balaganesh, AM ]
ORDER Per M.Balaganesh, AM
This appeal by the Assessee arises out of the order of the Learned Commissioner of Income Tax (Appeals) -12, Kolkata [ in short the ld CITA] in Appeal No. 584/CIT(A)- 12/Kol./Wd-9(3)/Kol/2014-15 dated 08.09.2015 against the order passed by the ITO, Ward-9(3), Kolkata [ in short the ld AO] under section 143(3) of the Income Tax Act, 1961 (in short “the Act”) dated 28.03.2013 for the Assessment Year 2010-11.
The only issue to be decided in this appeal is as to whether the Ld. CIT(A) was justified in upholding the addition made towards estimation of net profit by the Ld. AO in the facts and circumstances of the case by passing an ex parte order.
The brief facts of this issue is that the assessee is engaged in the business of trading and embroidery in sarees. The assessee filed its return of income for the assessment years 2010-11 on 08.10.2010 declaring taxable income of Rs. 11,10,025/-. Due to 2 Maheshwari Vanijya Pvt. Ltd. A.Yr.2010-11 continuous non-cooperation of the assessee before the Ld. AO by not furnishing the requisite details, the Ld. AO sought to complete the assessment by resorting to estimate the net profit. The Ld. AO observed that the assessee has shown turnover of Rs. 14.60 crores in its profit and loss account and had reported net profit of Rs. 3,27 lacs only. He observed that though the turnover had increased from 7.60 crores to 12.78 crores in the trading business, the net profit shown by the assessee is very low. Accordingly, he determined the net profit of the assessee at 3% of total turnover and arrived at the figure of Rs. 43,79,399/- as against Rs. 3,27,213/- shown by the assessee. Accordingly, he added the sum of Rs. 40,52,186/- to the total income of the assessee and completed the assessment.
Before the Ld. CIT(A) none appeared on behalf of the assessee and the Ld. CIT(A) observed that there were many non-compliances on the part of the assessee before him also. Accordingly, he upheld the addition made by the Ld. AO. Aggrieved, the assessee is in appeal before us on the following grounds:
1. That the order of the Learned Commissioner of Income Tax (Appeal)-12, Kolkata confirming the additions and disallowance made by learned assessing officer is contrary to the law and facts of the case.
2. That the Learned Commissioner of Income Tax (Appeal)-12, Kolkata erred in not providing reasonable opportunity of hearing to the appellant.
3. That on the facts and circumstances of the case the learned Commissioner of Income Tax (Appeal)-12 erred in confirming the addition made by the learned Assessing officer by estimating the net profit at 3% of the total turnover being Rs. 43,79,399/- without having any evidence in his possession in respect of taking a higher net profit against the net profit disclosed by the appellant.
4. That the appellant craves leave to add/or amend any ground of this appeal.
Even before us, the assessee was represented only by its staff M/s Bharat Goyel. In fact, the assessee had sought for adjournment on the date of hearing before us through its staff M/s Bharat Goyel and the same was rejected by this Bench as it was decided to
We have heard the Ld. DR. In the facts and circumstances of the case, we deem it fit and appropriate, to remand the appeal to the file of the Ld. CIT(A) for de novo adjudication, in accordance with law. The assessee is directed to co-operate with the Ld. CIT(A) for expeditious disposal of the appeal before the Ld. CIT(A) and not to take more than two adjournments before him, which should also be resorted to only in exceptional and bona fide circumstances. Accordingly, grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the Court on 20.09.2017