M/S T.C. AGRO PVT. LTD.,KURUKSHETRA vs. ITO, KURUKSHETRA

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ITA 753/CHANDI/2017Status: DisposedITAT Chandigarh09 April 2018AY 2013-143 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the facts were identical to a previous assessment year where a similar addition was deleted. Following the Tribunal's own decision for the earlier year, the addition made in the current year was also deleted.

What were the facts?

The assessee's books of account were lost in a fire, leading the Assessing Officer to complete the assessment under Section 144 based on best judgment. An addition of Rs. 25 lacs was made due to claimed exaggerated expenditure. The CIT(A) confirmed this addition.

What were the issues?

Whether the best judgment assessment and the addition made by the Assessing Officer were justified when the assessee's books were lost in a fire, and if the decision for a prior assessment year should be followed.

Which sections of the Income-tax Act were involved?

Section 145,Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DIVISION BENCH, ‘B’ CHANDIGARH

Before: SHRI SANJAY GARG & DR. B.R.R. KUMAR

Hearing: 09.04.2018Pronounced: 09.04.2018

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against

the order dated 27.02.2017 of the Commissioner of Income Tax

[hereinafter referred to as CIT(A)], Karnal.

2.

The sole issue raised in this appeal is relating to the addition made by the Assessing officer of an amount of Rs. 25

lacs by way of invoking the provisions of section 145 of the Act

during the assessment completed u/s 144 of the Income-tax Act,

1961 (in short 'the Act').

3.

The brief facts relating to the issue are that assessee filed

the return of its income declaring total income of Rs. 1,24,800/-.

However, during the assessment proceedings, the assessee did not T.C. Agro Pvt Ltd., Kurukshetra furnish the books of account stating that the same had been lost in the fire and that a FIR was also lodged in this respect. The Assessing officer, therefore, proceeded to make the assessment

u/s 144 of the Act as per the best judgement rule. The Assessing

officer taking into consideration the turnover of the assessee viz a viz the expenditure claimed observed that the assessee claimed

exaggerated expenditure and accordingly estimated the income of the assessee by making an addition of Rs. 25 lacs.

4.

In appeal, the CIT(A) confirmed the addition so made by the Assessing officer while relying upon the decision of his

predecessor in the earlier assessment year 2011-12. 5. Before us, the Ld. Counsel for the assessee, at the outset,

has submitted that the facts involved in this case are identical to earlier assessment year 2011-12. Records relating to the assessment year under consideration i.e. 2013-14 was destroyed

alongwith that of assessment year 2011-12 in the same fire

incident occurred on 23.1.2014. He has further relied upon the decision of the Tribunal in the case of assessee for assessment

year 2011-12 in ITA No. 1215/Chd/2016 vide order dated

29.5.

2017 wherein the SMC bench of the Tribunal taking into consideration the overall facts and circumstances of the case

taking into consideration the past history, GP rate and net profit

declared by the assessee in the earlier assessment years has deleted the addition of Rs. 20 lacs made by the Assessing officer

in that year taking into consideration the past history, GP rate T.C. Agro Pvt Ltd., Kurukshetra and net profit declared by the assessee in the earlier assessment year. The Ld. CIT(A) in this case has followed the order of his predecessor in the earlier assessment year 2011-12 which by now stood reversed by the decision of the Tribunal dated 29.5.2017 (supra). Hence, following the same ratio, the addition made during the year for the assessment year under consideration by the lower authorities on the same footing is required to the deleted. Hence, respectfully following the decision of the Tribunal in the own case of assessee for assessment year 2011-12, the addition made for the year under consideration is ordered to be deleted.

6.

The appeal of assessee stands allowed. Order pronounced in the Open Court. (B.R.R.KUMAR) JUDICIAL MEMBER Dated : 09.04.2018 Rkk Copy to: • The Appellant • The Respondent • The CIT • The CIT(A) • The DR

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