SHRI BINOD KUMAR,JAMSHEDPUR vs. JCIT, JAMSHEDPUR

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ITA 139/RAN/2016Status: DisposedITAT Ranchi10 November 2022AY 2011-124 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that there is no provision preventing additions for sundry creditors and disallowance of expenditure if the net profit is above 5%, provided the assessee is not under presumptive taxation. The assessee's failure to furnish details led to the dismissal of the grounds.

What were the facts?

The assessee, engaged in contract business, failed to provide details for sundry creditors and contract expenditure during assessment and appeal proceedings. Consequently, the Assessing Officer and CIT(Appeals) made additions to the assessee's income.

What were the issues?

Whether additions for sundry creditors and disallowance of contract expenditure are justified when the assessee fails to provide supporting details. Whether ex-parte orders passed by lower authorities are justified in cases of non-compliance.

Which sections of the Income-tax Act were involved?

Section 143(2),Section 142(1),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA-RANCHI ‘e-COURT’, KOLKATA

Before: Dr. Manish Borad & Shri Sonjoy Sarma

Per Dr. Manish Borad, Accountant Member:- The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Appeals), Jamshedpur dated 28.10.2015 passed under section 250 of the Income Tax Act, 1961 for the assessment year 2011-12.

2.

The grounds raised by the assessee read as under:- (i) Inspite of declaring more than 5% net profit, audited account has not been considered and all sundry creditors amounting to Rs.50,01,167/- is added back to my income.

1.

(ii) Contract expenditure is mandatory expenditure for running contract business and inspite of this fact

Assessment Year : 2011-2012 Shri Binod Kumar, Jamshedpur this expenditure is disallowed and added back which is against the natural justice.

(iii) Ld. Assessing Officer and ld. CIT(A), Jamshedpur, both have not justified in passing ex-parte order.

(iv) Rest grounds may be submitted before Hon’ble Tribunal at the time of hearing.

3.

Brief facts of the case are that the assessee is an individual, who is engaged in contract business. Income of Rs.25,02,890/- declared in the return was filed on 30.09.2011. The case of assessee was selected for scrutiny assessment followed by service of valid notices under sections 143(2) and 142(1) of the Act. The assessee remained non-compliant during the course of assessment proceedings. The ld. Assessing Officer on the basis of details available on record observed that the assessee has shown sundry creditors of Rs.50,01,167/-. However, for lack of details filed by the assessee and complete non-compliance, the said amount was added to the income of the assessee alongwith the other addition for disallowance of contract expenditure at Rs.10,00,000/- and finally income assessed at Rs.85,04,057/-.

4.

The assessee challenged this addition before the ld. CIT(Appeals), but again could not file any details and also did not attend on the basis of various dates of hearing. As a result, the ld. CIT(Appeals) confirmed the order of the ld. Assessing Officer.

5.

Aggrieved, the assessee is now in appeal before the Tribunal.

6.

None appeared on behalf of the assessee at the time of hearing before us.

7.

We have heard the ld. Departmental Representative and perused the relevant material available before us. The contention of the assessee is that firstly when the assessee has declared net profit rate of 5%, the ld.

Assessment Year : 2011-2012 Shri Binod Kumar, Jamshedpur CIT(Appeals) erred in confirming the addition for sundry creditors amounting to Rs.50,01,167/- and secondly, it is contended that the disallowance for contract expenditure was uncalled for as it is mandatory for any contract business. We find that the ld. Assessing Officer has not rejected the book results and has not estimated the profits of the assessee and for want of necessary details made the addition for sundry creditors of Rs.50,01,167/- and also disallowed the contract expenditure of Rs.10,00,000/-. We fail to find out any merit in the grounds of appeal, firstly, there is no provision under the Act which stops the Assessing Officer from making the addition for sundry creditors and disallowance of expenditure if net profit declared by the assessee is more than 5% if assessee is not covered under presumptive taxation. Secondly, the assessee failed to furnish the details called for by the ld. Assessing Officer and ld. CIT(Appeals). Before us also, the assessee has not filed any written submission or any documents. Under these given facts and circumstances, we find no merit in the grounds raised by the assessee and thus no interference is called for in the finding of the ld. CIT(Appeals), the effective Grounds No. 1 & 2 are dismissed.

8. Ground No. 3 is challenging the order of ld. CIT(Appeals) that both the lower authorities were not justified in passing the ex-parte order, we find that it has no merit as the assessee seems to be a habitual offender and does not appear on the given dates of hearing before any of the authorities below. Thus this ground is also dismissed.

9.

In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on November 17th, 2022.

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