M/S. SIDHI CARGO CARRIER,JAJPUR vs. ACIT, CIRCLE-1(2), CUTTACK

IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK ‘SMC’ BENCH, CUTTACK BEFORE SHRI N.S SAINI, ACCOUNTANT MEMBER

ITA No. 211/CTK/2016 Assessment Year :2010-2011

M/s. Sidhi Cargo Carriers, Vs. ACIT, Circle 1(2), Cuttack Sukinda Block Road Transport, Dist: Jajpur PAN/GIR No.AANFM 8220 B (Appellant) .. ( Respondent)

Assessee by : Shri Damodar Pati, AR Revenue by : Shri D.K.Pradhan, DR

Date of Hearing : 02 /02/ 2017 Date of Pronouncement : 02/02/ 2017

O R D E R This is an appeal filed by the assessee against the order of CIT(A)-

Cuttack, dated 8.12.2015, for the assessment year 2010-2011 .

erred in confirming the action of the Assessing Officer determining the profit

out of transportation business @ 5% and determination of profit @ 6% on

trading business.

that the Assessing Officer determined the profit @ 8% on trading business,

which was reduced by the CIT(A) to 6%. Hence, he is not pressing this

ground of appeal. Accordingly, same is dismissed for want of prosecution.

2 ITA No. 211/CT K/ 2016 Asse ssment Year :20 10- 201 1 4. Regarding determination of profit at 5% out of transportation

business, the Assessing Officer observed that the assessee was asked as to

who has executed the transport contract during the year and produce to

books of account particularly the cash book. The assessee only furnished

the ledger account copy of the expenses claimed in support of the profit

and loss account. On verification of such ledger account copies, the

Assessing Officer found that all the transportation charges were paid in

cash. The Assessing Officer verified the bills and vouchers and observed

that in some vouchers they were not having the recipient’s signature and

other details like addresses etc. Since the cash book was not produced and

the bills and vouchers were not regular and could not be verified, therefore,

the Assessing Officer held that the correctness and completeness of the

accounts cannot be accepted and hence, reject the books of account

u/s.145(3) of the Act and, thereafter, estimated the profit from

transportation business at 5% of the gross receipts.

decision of this Bench of the Tribunal in the case of Harihar Roadways for

the submission that the Tribunal has determined the profit for

transportation business at 1%. The CIT(A) observed that the Tribunal in

the case of Phulchand Agarwal has held that in the absence of cash book,

the accounting results of the assessee can be rejected and estimation of

profit can be made. The decision in the case of Harihar Roaways (supra)

relied on by the assessee was in that particular case which may not have

3 ITA No. 211/CT K/ 2016 Asse ssment Year :20 10- 201 1 application to the present case of the assessee. Hence, he confirmed the

action of the Assessing Officer.

determination of income by applying rate of 5% to the transportation

business of the assessee was excessive. He submitted that the assessee

was not owning any vehicles and it was taking vehicles on hire and then

giving to others on hire and thereby making a meagre profit. Therefore, in

the given facts and circumstances of the case, a reasonable estimation of

the income by applying the lower rate should be made.

considered view that it would meet the ends of justice if the net profit from

transportation business of the assessee is estimated by applying the rate

of 3% to the turnover from transportation business. I, accordingly, modify

the order of the CIT(A) and partly allow the ground of appeal of the

assessee.

Cuttack; Dated 02/02/2017 B.K.Parida, SPS

4 ITA No. 211/CT K/ 2016 Asse ssment Year :20 10- 201 1 Copy of the Order forwarded to : 1. The Appellant : M/s. Sidhi Cargo Carriers, Sukinda Block Road Transport, Dist: Jajpur 2. The Respondent. ACIT, Circle 1(2), Cuttack 3. The CIT(A)- Cuttack 4. Pr.CIT, Cuttack 5. DR, ITAT, Cuttack 6. Guard file. //True Copy// BY ORDER,

SR.PRIVATE SECRETARY ITAT, Cuttack