Income Tax Appellate Tribunal - Jaipur
M/S. R.C.Bansiwal & Brothers, Ajmer vs Deputy Commissioner Of Income Tax, ... on 10 September, 2018
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IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR
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BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM
vk;dj vihy la-@ITA. No. 795/JP/2018
fu/kZkj.k o"kZ@Assessment Year : 2010-11
M/s R.C. Bansiwal & Brothers cuke The DCIT,
Prakash Road, Nagra, Vs. Circle-1,
Ajmer. Ajmer.
LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AAFFR 6987 G
vihykFkhZ@Appellant izR;FkhZ@Respondent
fu/kZkfjrh dh vksj l@
s Assessee by : None (written submissions)
jktLo dh vksj ls@ Revenue by : Shri. J.C. Kulhari (JCIT)
lquokbZ dh rkjh[k@ Date of Hearing : 06/09/2018
mn?kks"k.kk dh rkjh[k@Date of Pronouncement : 10/09/2018
vkns'k@ ORDER
PER: VIKRAM SINGH YADAV, A.M. This is an appeal filed by the assessee against the order of ld. CIT(A), Ajmer dated 16.04.2018 for the Assessment Year 2010-11 wherein the assessee has taken the following grounds of appeal:
"(1) That the learned AO & CIT (Appeals) both erred in making an addition of Rs. 260000/- by disallowing the expenses claimed, the CIT Appeals not given any reasons in his order to mention the decision of AO with regards to disallowance of 2 ITA No. 795/JP/2018 M/s R.C. Bansiwal & Brothers vs. DCIT expenses on ad hoc basis without pointing out any defects in books simply on the basis of 8% net profit rate applicable in case of turnover more than 40 Lacs which is quite wrong but it should have been considered in letter way than less turnover.
The addition is quite wrong & unjustified and only maintained to support AO order without considering the argument given in writing and/or explained at the time of hearing of appeal.
(2) That the reopening of assessment u/s 148 itself was wrong & illegal as the basis on which the case was reopened as on date itself wrong & the return was already on file duly filed on 19-02-17 as admitted in order. Hence the notice issued on 30-3- 17 recording reasons for no return filed is quite wrong & hence reopening is made merely on change of opinion basis.
(3) That the AO has not considered the written submissions & audited Statements filed with Audit report u/s 44AB with no reasons. The past history of the case & results not at all considered prior to making an addition of Rs. 260000/- on adhoc basis (4) That the net profit rate was more than 8% of Gross receipts in spite of more gross receipts over & above 40 Lacs even & hence it should have been accepted as return income. (5) That the order is bad law of both the lower authorities."
2. Briefly the facts of the case are that the assessee is engaged in civil contractor business and has disclosed gross contract receipt of Rs. 1,62,84,311/-. The assessment was completed U/s 143(3) r.w.s. 147 of the Act wherein the Assessing Officer has accepted the income shown in the return of income, however, has made a disallowance of expenses amounting to Rs. 2,60,000/- and therefore, assess the income at Rs. 11,57,745/-. The relevant finding of the AO is reproduced as under:-
3 ITA No. 795/JP/2018M/s R.C. Bansiwal & Brothers vs. DCIT "During the course of assessment proceedings, it has submitted that the assessee the assessee is engaged in civil contractor ship business. It is also submitted that during the year under consideration the assessee has executed the contract of Mayo College General counsel and Society of Catholic diocession of Jaipur. The total contract receipt has been declared at Rs. 1,62,84,311/- which is matched with 26AS statement. The TDS has also been claimed as per 26AS statement. During the course of assessment proceeding, the the assessee was specifically asked to produce the bills and vouchers of purchases of Bricks, cement, conceret, sand stone as well as expenditure debited in P&L a/c. It is explained that though the computerised books which were kept in computer is ready for verification but certain bills and vouchers of purchases are missing being old matter and are not subject to verification. It is further contended that this is a case of partnership firm and before allowing salary to partners the remaining profit is more than 8%. It is not case of no books of a/c and turnover of the assessee is also more than the limit prescribed u/s 44AB of the Act. Therefore, in absen ce of bills and vou chers of purchases/ expenditure, the true profit cannot be ascertained. Considering the nature of expenses and debited in books of a/c which is almost in cash and cannot be verified fully. Therefore, a sum of Rs. 2,60,000/- disallowed being n ot verifiable and incurred for non business expediency and accordingly added to the total in come of the assessee."
3. Being aggrieved the assessee carried the matter in appeal before the ld. CIT(A) who has upheld the reopening U/s 148 of 4 ITA No. 795/JP/2018 M/s R.C. Bansiwal & Brothers vs. DCIT the Act and also the addition of Rs. 2,60,000/-. Now the assessee's in appeal before us.
4. None has appeared on behalf of the assessee, however, written submissions were filed which have been considered and the ld. DR has been heard.
5. After hearing both the parties, we find that the addition has been made on purely an adhoc basis and there is no finding recorded by the Assessing Officer that the expenses have not been incurred for the purposes of business or the assessee has claimed any bogus expenditure. In light of the same, the adhoc disallowance of Rs. 2,60,000/- is hereby directed to be deleted.
6. Having decided the matter in favour of the assessee on merits, we do not consider it necessary to adjudicate the ground relating to reopening to the assessment U/s 148 of the Act.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open Court on 10/09/2018.
Sd/- Sd/-
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(Vijay Pal Rao) (Vikram Singh Yadav)
U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member
Tk;iqj@Jaipur
fnukad@Dated:- 10/09/2018.
5 ITA No. 795/JP/2018
M/s R.C. Bansiwal & Brothers vs. DCIT
*Santosh
vkns'k dh izfrfyfi vxzfs 'kr@Copy of the order forwarded to:
1. vihykFkhZ@The Appellant- M/s R.C. Bansiwal & Brothers, Ajmer.
2. izR;FkhZ@ The Respondent- DCIT, Circle-1, Ajmer.
3. vk;dj vk;qDr@ CIT
4. vk;dj vk;qDr@ CIT(A)
5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur.
6. xkMZ QkbZy@ Guard File { ITA No. 795/JP/2018} vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar