Income Tax Appellate Tribunal - Hyderabad
Dcit, Circle-8(1), Hyd, Hyderabad vs Nuziveedu Swathi Coastal, Hyd, ... on 9 August, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
HYDERABAD BENCHES "A", HYDERABAD
BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER
AND
SMT. P. MADHAVI DEVI, JUDICIAL MEMBER
ITA No. AY. Appellant Respondent
M/s. Nuziveedu Swathi Asst. Commissioner
1890/Hyd/14 2009-10 Coastal Consortium, of Income Tax,
Hyderabad Circle-8(1),
[PAN: AAAAN3839R] Hyderabad
Deputy Commissioner M/s. Nuziveedu
818/Hyd/16 2011-12 of Income Tax, Swathi Coastal
Circle-8(1), Consortium,
Hyderabad Hyderabad
[PAN: AAAAN3839R]
For Assessee : Shri A.V. Raghu Ram, AR
For Revenue : Shri A.G.V. Prasad, DR
Date of Hearing : 09-08-2017
Date of Pronouncement : 09-08-2017
ORDER
PER CHANDRA POOJARI, A.M. :
These two appeals are filed by both Assessee and Revenue against different orders of the Commissioner of Income Tax (Appeals), for the AYs. 2009-10 & 2011-12.
ITA No. 1890/Hyd/2014 (Assessee's Appeal):2. In this appeal, assessee has raised the following grounds of appeal:
ITA Nos. 1890/Hyd/14:- 2 -: 818/Hyd/16 "1. The order of the learned CIT(A), Vijayawada is against law and facts of the case.
2. The learned CIT(A) ought to have appreciated that the books results cannot be rejected without giving a finding as to how the correct profits cannot be deducted from the books of accounts, especially in a case where no defects in the books of account were pointed out.
3. Without prejudice to the above grounds, the learned CIT(A) ought to have appreciated that estimation of profits at 5% of the turnover is excessive, unreasonable and without any cogent material.
4. The learned CIT(A) ought to have appreciated that having regard to the facts of the case that the operating profit is more than the normal profit in a similar line of business, the deduction towards depreciation, and interest on borrowed funds show have been allowed from the estimated profit.
5. For these or any other ground or grounds that may be urged at the time of hearing of the appeal".
3. In this case, Assessing Officer (AO) estimated the income of the assessee at 5% of the gross receipts. On appeal, CIT confirmed the same. Now the contention of the Ld.AR is that the order of the lower authorities is very cryptic and they blindly followed the earlier order of the Tribunal in ITA Nos. 225/Hyd/2010 and 725/Hyd/2010 for the AYs. 2006-07 & 2007-08 dt. 26-11-2010, it is to be set aside.
4. We have heard the rival contentions and perused the material available on record. In our opinion, there is a force in the argument of the Ld.AR that the AO cannot estimate the income of the assessee without rejecting the books of account by speaking order. Accordingly, in the interest of justice, we remit the entire issue-in-dispute to the file of AO for fresh consideration after giving opportunity of hearing to the assessee.
ITA Nos. 1890/Hyd/14:- 3 -: 818/Hyd/16 5. In the result, this appeal of assessee in ITA No.
1890/Hyd/2014 is partly allowed for statistical purposes.
ITA No. 818/Hyd/2016 (Revenue's Appeal):6. In this appeal, Revenue has raised the following grounds of appeal:
"1. The CIT(A) has erred in both facts of the case and law.
2. The CIT(A) has erred in not considering the fact that the basic facts for the AY. 2006-07 and AY. 2011-12 are same in this case.
3. The CIT(A) has not appreciated the fact that the assessing officer has strictly followed all the provisions of section 144 of the IT Act before rejecting the books of accounts and estimated the business income following the Hon'ble ITAT order passed in assessee's own case for the AY. 2006-07.
4. Any other ground arises during the course of appeal proceedings".
7. In this case, AO estimated the income of the assessee at 5% of the gross receipts. However, CIT(A) deleted the addition considering certain additional evidence and arguments which are not placed before the AO.
8. We have heard the rival contentions and perused the material available on record. In our opinion, what are the documents placed before the CIT(A) should have been confronted to AO for his comments which the CIT(A) failed to do so. In view of this, we remit the entire issue to the file of the AO for fresh consideration after giving due opportunity of hearing to the assessee.
ITA Nos. 1890/Hyd/14:- 4 -: 818/Hyd/16
9. In the result, appeal of Revenue in ITA No. 818/Hyd/2016 is partly allowed for statistical purposes.
10. To sum-up, both assessee's appeal and Revenue's appeal are partly allowed for statistical purposes.
Order pronounced in the open court on 9th August, 2017 upon conclusion of hearing Sd/- Sd/-
(P. MADHAVI DEVI) (CHANDRA POOJARI) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated 9th August, 2017 TNMM Copy to :
1. M/s. Nuziveedu Swathi Coastal Consortium, C/o. A.V. Raghu Ram, Advocate, 610, Babukhan Estate, Basheerbagh, Hyderabad.
2. The Deputy Commissioner of Income Tax, Circle-8(1), Hyderabad.
3. The Asst. Commissioner of Income Tax, Circle-8(1), Hyderabad.
4. CIT (Appeals)- Vijayawada.
5. CIT (Appeals)-2, Hyderabad.
6. CIT-II, Hyderabad.
7. Pr. CIT-2, Hyderabad.
8. D.R. ITAT, Hyderabad.
9. Guard File.