SMT ANJU LASHKERY, Jaipur v. INCOME TAX OFFICER, WARD-5-2, Jaipur

ITA 1058/JPR/2019 | 2003-2004
Pronouncement Date: 10-05-2021 | Result: Allowed

Appeal Details

RSA Number 105823114 RSA 2019
Assessee PAN AAGPL8891A
Bench Jaipur
Appeal Number ITA 1058/JPR/2019
Duration Of Justice 1 year(s) 8 month(s) 12 day(s)
Appellant SMT ANJU LASHKERY, Jaipur
Respondent INCOME TAX OFFICER, WARD-5-2, Jaipur
Appeal Type Income Tax Appeal
Pronouncement Date 10-05-2021
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 10-05-2021
Last Hearing Date 29-01-2020
First Hearing Date 26-06-2020
Assessment Year 2003-2004
Appeal Filed On 28-08-2019
Judgment Text
VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCHE S A JAIPUR JH LAANHI XKSLKBZ] U;KF;D LNL; OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI SANDEEP GOSAIN JM & SHRI VIKRAM SING H YADAV AM VK;DJ VIHY LA-@ ITA. NO. 1058/JP/2019 FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2003-04 SMT. ANJU LASHKERY P/O SHRI RATNAM 22 PURANDARJI KA BAGH MD ROAD JAIPUR. CUKE VS. THE ITO WARD-5(2) JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAGPL8891 A VIHYKFKHZ@ AP PELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI PRAVEEN SARASWAT (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : SMT. MONISHA CHOUDHARY (ADD.CIT) A LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 02/03/2021 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 10/05/2021 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF LD. CIT(A)-II JAIPUR DATED 25.06.2019 FOR THE ASSESSME NT YEAR 2003-04 WHEREIN THE ASSESSEE HAS TAKEN THE FOLLOWING GROUND S OF APPEAL:- 1. THAT THE LD. AO HAS WRONGLY MADE THE ADDITION O F RS. 15 39 905/- BEING 25% OF ALLEGED BOGUS PURCHASE BESIDES MAKING THE TRADING ADDITION OF RS. 30 79 250/- ON A CCOUNT OF LOW GROSS PROFIT. LD. CIT(A) HAS UPHELD THE SAME TO THE EXTENT OF RS. 808 400/- IN PLACE OF RS. 15 39 905/-. ENTIRE A DDITION OF RS. 15 39 905/- WAS DELETED BY THE HONBLE ITAT VID E ITS ORDER DATED 24/04/2008. THUS LD. AO AND LD. CIT(A) HAVE E RRED BY ITA NO. 1058/JP/2019 SMT. ANJU LASHKERY VS. ITO 2 UPHOLDING THE ADDITION IGNORING THE ORDER OF HONB LE ITAT ON THIS ISSUE. 2. THE LD. CIT(A) HAS ERRED BY ESTIMATING THE GP @ 13% AS AGAINST THE 12.14% DECLARED BY ASSESSEE FOR MAKING THE ADDITION OF RS. 8 08 400/- ON ACCOUNT OF ALLEGED BOGUS PURC HASES. LD. CIT(A) HAS IGNORED THE FACT THAT A SEPARATE TRADING ADDITION OF RS. 30 79 250/- TAKING THE GP RATE OF 15.42% HAS ALREA DY BEEN UPHELD BY HONBLE ITAT AND NOT DISPUTED BY ASSESSEE BEFORE LD. CIT(A). 3. THAT THE LD. AO HAS IGNORED THE REQUESTS OF THE ASSESSEE TO SUMMON AND ENFORCE THE ATTENDANCE OF THE PARTIES U/ S 131 FOR CONFIRMING THE PURCHASES WORTH RS. 61 59 622/-. NON -EXERCISE OF THE POWERS CONFERRED ON LD. AO U/S 131 HAS DISCHARG ED THE ASSESSEE FROM THE INITIAL ONUS COST ON HER AND THE REFORE THE ADDITION ON THE ACCOUNT OF BOGUS PURCHASES AMOUNTIN G RS. 15 39 905/- IS NOT SUSTAINABLE. 2. DURING THE COURSE OF HEARING THE LD. AR SUBMITT ED THAT THIS IS THE SECOND ROUND OF APPELLATE PROCEEDINGS AND IN THE FI RST ROUND THE MATTER HAS REACHED BEFORE THE HONBLE RAJASTHAN HIGH COURT ON APPEAL BY THE REVENUE AND THE HONBLE RAJASTHAN HIGH COURT HAS RE MANDED THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR DEC IDING THE SAME AFRESH. IT WAS SUBMITTED THAT THE ASSESSING OFFICER WHILE P ASSING THE IMPUGNED ASSESSMENT ORDER HAS MADE AN ADDITION OF RS. 15 39 905/- U/S 69C OF THE ACT BEING 25% ON PURCHASES AMOUNTING TO RS. 61 59 622/- ON ACCOUNT OF ALLEGED BOGUS PURCHASES. ON APPEAL BY TH E ASSESSEE THE LD. CIT(A) HAD UPHELD THE ADDITION OF RS. 8 08 400/- BY ESTIMATING THE GROSS PROFIT @ 13% AS AGAINST 12.14% DECLARED BY TH E ASSESSEE. IT WAS SUBMITTED THAT BOTH THE LOWER AUTHORITIES HAVE IGNO RED THE FACT THAT IN THE FIRST ROUND THE ASSESSING OFFICER HAD ALREADY MADE SEPARATE TRADING ITA NO. 1058/JP/2019 SMT. ANJU LASHKERY VS. ITO 3 ADDITION OF RS. 30 79 250/- BY RAISING GP RATE FROM 12.14% TO 15.42% AND ALL THE DEFICIENCY IN THE BOOKS OF ACCOUNTS AS ALLEGED IN RESPECT OF THE ISSUE OF BOGUS PURCHASES HAVE BEEN DULY TAKE CA RE OF BY SUCH AN ADDITION AS HELD BY THE LD. CIT(A) AND AFFIRMED BY THE TRIBUNAL IN THE FIRST ROUND. IT WAS SUBMITTED THAT IN THE INSTANT C ASE THE FACTUAL MATRIX OF THE CASE IS DIFFERENT FROM VIJAY PROTEINS/ SANJA Y OIL CASE WHICH HAS BEEN FOLLOWED BY THE AO THEREFORE THE RATIO LAID DOWN IN THE SAID DECISIONS CANNOT BE APPLIED IN THE INSTANT CASE. IT WAS SUBMITTED THAT IN THE PRESENT PROCEEDINGS THE AO HAS APPLIED ONLY PA RT OF THE DIRECTIONS GIVEN BY THE TRIBUNAL IN THE FIRST ROUND WHICH SUIT ED THE REVENUE AND HAS COMPLETELY IGNORED THE CONCLUDING PART OF THE T RIBUNALS DECISION WHEREIN IT WAS HELD THAT BY APPLYING HIGHER GP RATE OF 15.42% AS AGAINST 12.41% IS SUFFICIENT TO TAKE CARE OF THE AL LEGED BOGUS PURCHASES AND FINDINGS OF THE LD CIT(A) WERE UPHELD. 3. IT WAS FURTHER SUBMITTED THAT DURING THE PRESENT PROCEEDINGS IN RESPONSE TO NOTICE U/S 142(1) THE ASSESSEE HAS FUR NISHED THE NECESSARY DOCUMENTS IN TERMS OF PURCHASE BILLS SAL ES TAX REGISTER NUMBER PAN NUMBER CONFIRMATIONS COMPLETE ADDRESS AND BANK STATEMENT OF THE SELLERS AS WELL AS THE ASSESSEE. THEREAFTER THE ASSESSING OFFICER HAS NOT RAISED ANY FURTHER QUERIE S FROM THE ASSESSEE. REGARDING THE FINDINGS OF THE AO THAT THE ASSESSEE FAILED TO PRODUCE THE PARTIES IN ORDER TO EXAMINE THEM TO ASCERTAIN THE G ENUINENESS OF THE TRANSACTIONS IT WAS SUBMITTED THAT THE AO HAD NEVE R ASKED THE ASSESSEE TO PRODUCE ANY OF THE CREDITORS AND THE AS SESSEE THEREFORE CANNOT BE EXPECTED IN SUCH CIRCUMSTANCES TO PRESENT THE PERSONS BEFORE THE ASSESSING OFFICER WHERE THE AO HAS NEITH ER FIXED THE DATE OR ITA NO. 1058/JP/2019 SMT. ANJU LASHKERY VS. ITO 4 TIME FOR THEIR PERSONAL APPEARANCE. IT WAS SUBMITTE D THAT THE ASSESSEE HAS ASKED THE AO TO ISSUE SUMMONS TO THIS PERSONS U /S 131OF THE ACT. IT WAS ACCORDINGLY SUBMITTED THAT THE ASSESSEE HAS DISCHARGED THE NECESSARY OBLIGATION CAST ON HER AND SHE CANNOT BE PUNISHED FOR THE FAILURE ON PART OF THE ASSESSING OFFICER TO TAKE FU RTHER ACTION. IT WAS ACCORDINGLY SUBMITTED THAT THE ADDITION SO MADE AND CONFIRMED BY THE LD CIT(A) BE DIRECTED TO BE DELETED. 4. PER CONTRA THE LD. DR RELIED ON THE FINDING OF THE LOWER AUTHORITIES AND OUR REFERENCE WAS DRAWN TO THE FIND INGS OF THE LD CIT(A) WHICH ARE CONTAINED AT PARA 2.3 TO 3.3.2 OF THE APP ELLATE ORDER WHICH READS AS UNDER:- 2.3 GROUND NO. 01 TO 03 ARE BEING TAKEN UP TOGETHE R WHICH ARE INTERRELATED. I HAVE PERUSED THE FACTS OF THE CASE THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. IT IS S EEN THAT ASSESSEE HAS OBTAINED PURCHASE BILLS OF RS. 61 59 6 22/- FROM TWO PARTIES NAMELY M/S AMBICA IMPEX AND M/S ABHINAV GEM S. IN THE ORIGINAL ASSESSMENT PROCEEDINGS U/S 143(3) DATED 1 6.03.2006 ASSESSING OFFICER APPLIED SECTION 145(3) AND MADE A DDITION AND ALSO UNDER SECTION 69C OF RS. 61 59 622/- . AGAINST THE ORDER OF CIT(A) ASSESSEE AS WELL AS DEPARTMENT FILED AN APP EAL BEFORE HONBLE ITAT. HON'BLE ITAT VIDE ITS ORDER 24.04.2008 IN ITA NO. 399/JP/2007 CONFIRMED THE ORDER OF CIT(A) IN ALLOWI NG ESTIMATION OF PROFIT. AGAINST THE ITAT ORDER DEPART MENT FILED APPEAL U/S 260A BEFORE HON'BLE RAJASTHAN HIGH COURT . HON'BLE RAJASTHAN HIGH COURT VIDE ITS ORDER 03.11.2016 DBIT APPEAL NO. 654/2008 REMIT BACK THE CASE TO THE AO FOR DECI DING AFRESH ON THE FACTUAL MATRIX. IN SET ASIDE ASSESSMENT ASSESSING OFFICER MADE ADD ITION OF RS. 15 39 905/- BEING 25% ON PURCHASE OF RS. 61 59 622/- MADE FROM M/S AMBICA IMPEX AND M/S ABHINAV GEMS AS BOGUS AND UNVERIFIABLE. ITA NO. 1058/JP/2019 SMT. ANJU LASHKERY VS. ITO 5 SINCE THE PURCHASES FROM TWO PARTIES ARE NOT VERIFI ABLE. EVEN IN SET ASIDE PROCEEDINGS AND ALSO IN APPELLATE PROCEED INGS ASSESSEE HAS FAILED TO VERIFY THE SAME. THEREFORE REJECTION OF BOOKS OF ACCOUNTS U/S 145(3) BY LD. ASSESSING OFFICER IS COR RECT AND HEREBY UPHELD. 2.3.1 AFTER REJECTION OF BOOKS OF ACCOUNTS THE INC OME HAS TO BE ESTIMATED BY APPLYING THE GP RATE WHICH HAS TO BE A PPLIED BASED ON THE PAST HISTORY OF THE APPELLANT. THE HON'BLE I TAT JAIPUR BENCH IN VARIOUS DECISIONS AS CITED BY ID. AR OF TH E ASSESSEE ALSO HELD THAT THE BASIS OF ESTIMATION SHOULD BE THE PAS T HISTORY OF THE ASSESSEE. IN DECISIONS OF M/S. ALLIED GEMS CORPORATION ITA NO . 794/JP/2011 AND RAJKUMAR AGRAWAL ITA NO. 504/JP/2013 THE HON'BL E ITAT RESTRICTED THE ADDITION TO THE AVERAGE GP RATE BASE D ON PAST YEARS. THUS IN VIEW OF ABOVE JUDICIAL PRONOUNCEMENT AFTER REJECTING BOOKS OF ACCOUNTS THE PAST HISTORY OF THE ASSESSEE HAS TO BE SEEN FOR ESTIMATING THE PROFIT OF THE APPELLANT. 3.3.2 DURING THE APPELLATE PROCEEDINGS THE LD. AR O F THE ASSESSEE SUBMITTED TRADING RESULTS OF PAST YEAR WHICH ARE AS UNDER. A.Y. TURNOVER GROSS PROFIT G.P.% 2002-03 99334873 15317989 15.42 2003-04 93836783 11390381 12.14 THEREFORE IN VIEW OF THE TOTALITY OF THE FACTS AND COMPONENT OF UNVERIFIABLE PURCHASES IN MAY CONSIDERED OPINION I T WOULD BE APPROPRIATE TO ESTIMATE THE GP AT 13% WHICH COMES T O RS. 1 21 98 781/-. CONSEQUENTLY THE TRADING ADDITION C OMES TO RS. 8 08 400/- ( 1 21 98 781/- 1 13 90 381) WHICH IS SU STAINED. ITA NO. 1058/JP/2019 SMT. ANJU LASHKERY VS. ITO 6 ACCORDINGLY THE BALANCE ADDITION OF RS. 7 31 505/- IS DELETED. THESE GROUNDS OF APPEAL ARE PARTLY ALLOWED. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD CIT(A) HAS RETURNED A F INDING THAT SINCE THE PURCHASES FROM TWO PARTIES REMAIN UNVERIFIED THE A O HAS RIGHTLY REJECTED THE BOOKS OF ACCOUNTS BY INVOKING PROVISIO NS OF SECTION 145(3) OF THE ACT. AT THE SAME TIME THE LD CIT(A) HAS NO T AGREED WITH THE AO AS FAR AS MAKING ADDITION OF RS 15 39 905/- BEING 2 5% OF UNVERIFIED PURCHASES FOR THE REASON THAT ONCE THE BOOKS OF ACC OUNTS ARE REJECTED THE INCOME HAS TO BE ESTIMATED BY APPLYING THE GP R ATE WHICH HAS TO BE ESTIMATED BASIS THE PAST HISTORY OF THE APPELLAN T AND HAS THUS ESTIMATED G.P RATE OF 13%. IT IS ALSO THE CONSISTE NT POSITION TAKEN BY THIS BENCH WHEREIN WE HAVE HELD THAT ONCE THE BO OKS OF ACCOUNTS HAVE BEEN REJECTED BY INVOKING THE PROVISI ONS OF SECTION 145(3) OF THE ACT THE ASSESSING OFFICER IS REQUIRED TO MAKE THE ASSESSMENT ON THE BASIS OF HIS BEST JUDGMENT AN D A FAIR ESTIMATE OF INCOME HAS TO BE MADE INSTEAD OF RESORTING TO MAKIN G THE ADDITION TO THE BOOK RESULTS WHICH ALREADY STAND REJECTED OR AN Y ALTERATION IN THE BOOK RESULTS. IN THE INSTANT CASE THE BOOK RESULT S HAVE BEEN REJECTED BY INVOKING THE PROVISIONS OF SECTION 145(3) OF THE ACT WHICH IS NOT UNDER DISPUTE BEFORE US. THE LIMITED GRIEVANCE OF THE ASSESSEE IS THAT AS AGAINST DECLARED GROSS PROFIT OF 12.14% THE G.P RATE OF 15.42% HAS ALREADY BEEN APPLIED BY THE LD CIT(A) WHICH HAS BEE N UPHELD BY THE TRIBUNAL IN THE FIRST ROUND OF LITIGATION AND HAS B EEN ACCEPTED BY BOTH THE PARTIES AND HAS THUS ATTAINED FINALITY AND THUS THERE IS NO BASIS FOR FRESH ESTIMATION OF GROSS PROFIT OF 13% BY THE LD C IT(A) IN THE SECOND ITA NO. 1058/JP/2019 SMT. ANJU LASHKERY VS. ITO 7 ROUND OF LITIGATION WHICH IS ANYWAY LOWER THAN WHAT HAS ESTIMATED IN THE FIRST ROUND AND MAKING A FURTHER ADDITION OVER AND ABOVE WHAT HAS ALREADY BEEN DONE BY ESTIMATING G.P RATE OF 15.42% IN THE FIRST ROUND OF LITIGATION. WE FIND THAT IN THE PRESENT PROCEED INGS THE AO HAS MADE AN ADDITION OF RS 15 39 905/- TOWARDS UNVERIFIED PU RCHASES TO REVISED TOTAL INCOME AS COMPUTED AFTER GIVING APPEAL EFFECT U/S 143(3)/250 DATED 16.02.2007 TO ORDER PASSED BY THE LD CIT(A) D ATED 8.01.2007 WHEREIN HE HAS ESTIMATED G.P RATE OF 15.42%. THERE FORE THE ADDITION OF RS 15 39 905/- IS MADE OVER AND ABOVE THE G.P AD DITION MADE IN THE FIRST ROUND OF LITIGATION WHEREIN G.P RATE HAS BEEN TAKEN AT 15.42% AS AGAINST 12.14% DECLARED BY THE ASSESSEE. IN THE SE COND ROUND THE LD CIT(A) HAS RIGHTLY DELETED THE ADDITION OF RS 15 39 905/- AS WE HAVE NOTED ABOVE AS THERE CANNOT BE SEPARATE ADDITION OT HER THAN ESTIMATION OF PROFITS WHERE THE BOOKS OF ACCOUNTS HAVE BEEN RE JECTED. AT THE SAME TIME THE LD CIT(A) HAS ESTIMATED G.P @ 13% FAILING TO TAKE INTO THE CONSIDERATION THE FACT THAT G.P HAS ALREADY BEEN ES TIMATED EARLIER @ 15.42% AND WHICH HAS BEEN ACCEPTED BY BOTH THE PART IES AND HAS ATTAINED FINALITY AND NECESSARY EFFECT GIVEN TO BY THE AO WHILE PASSING THE IMPUGNED ASSESSMENT ORDER. WE THEREFORE FIND F ORCE IN THE CONTENTION SO ADVANCED BY THE LD AR AND THE ADDITIO N SO SUSTAINED BY THE LD CIT(A) AMOUNTING TO RS 8 08 400/- IS HEREBY DIRECTED TO BE DELETED. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOW ED. ITA NO. 1058/JP/2019 SMT. ANJU LASHKERY VS. ITO 8 ORDER PRONOUNCED IN THE OPEN COURT ON 10/05/2021. SD/- SD/- LANHI XKSLKBZ FOE FLAG ;KNO ( SANDEEP GOSAIN ) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 10/05/2021. *GANESH KUMAR VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SMT. ANJU LASHKERY JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- ITO WARD-5(2) JAIPUR. 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. 1058/JP/2019} VKNS'KKUQLKJ@ BY ORDER LGK;D IATHDKJ@ ASST. REGISTRAR