D Saivenugopal, Chennai v. ITO, NCW 6(1), Chennai

ITA 386/CHNY/2019 | 2013-2014
Pronouncement Date: 27-11-2019 | Result: Dismissed

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Appeal Details

RSA Number 38621714 RSA 2019
Assessee PAN BETPS6046G
Bench Chennai
Appeal Number ITA 386/CHNY/2019
Duration Of Justice 9 month(s) 11 day(s)
Appellant D Saivenugopal, Chennai
Respondent ITO, NCW 6(1), Chennai
Appeal Type Income Tax Appeal
Pronouncement Date 27-11-2019
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 27-11-2019
Last Hearing Date 17-06-2019
First Hearing Date 17-06-2019
Assessment Year 2013-2014
Appeal Filed On 15-02-2019
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNALC BENCH: CHENNAI . BEFORE SHRI INTURI RAMA RAO ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY JUDICIAL MEMBER ./ ITA NO.386/CHNY/2019 /ASSESSMENT YEAR: 2013-14 SHRI D. SAIVENUGOPAL NEW NO.11 OLD NO.5 SAMI CHETTY STREET PUDUPET CHENNAI 600 002 [PAN: BETPS 6046G] VS. INCOME TAX OFFICER NON CORPORATE WARD-6(1) CHENNAI ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. R. PADMANABHAN C.A /RESPONDENT BY : MS. VIDYA RAMACHANDRAN ADDL.CIT /DATE OF HEARING : 10.10.2019 /DATE OF PRONOUNCEMENT : 27.11.2019 / O R D E R PER DUVVURU RL REDDY JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-16 CHENNAI DATED 18.01.2019 FOR THE ASSESSMENT YEAR 2013-14 PASSED UNDER SECTION 271(A) OF THE INCOME TAX ACT 1961 [ACT IN SHORT] IN CONFIRMING LEVY OF PENALTY OF .25 000/-. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS IN THE BUSINESS OF TRADING IN BROILERS (M/D OF M/S. SARASWATHI BROILER P. LTD). THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2013-14 ON 17.05.2014 ADMITTING A TOTAL INCOME OF .12 09 160/-. THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT ON 30.03.2016 ASSESSING A TOTAL INCOME OF .30 84 318/-. THE ITA NO.386/CHNY/2019 :- 2 -: ADDITION TO THE TOTAL INCOME IN THIS CASE WAS ON ACCOUNT OF DISALLOWANCE OF CLAIM OF AGRICULTURAL INCOME BEING UNSUBSTANTIATED DISALLOWANCE OF 44AF CLAIM ADDITION FOR DEEMED DIVIDEND AND SECTION 14A DISALLOWANCE. IN THE STATEMENT OF TOTAL INCOME FILED BY THE ASSESSEE THE ASSESSEE HAS CLAIMED TOTAL SALES OF .52 03 594/- AND CLAIMED PROFIT AT THE RATE OF 5% ON THESE TO DECLARE A PRESUMPTIVE INCOME OF .4 16 288/- UNDER SECTION 44F OF THE ACT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS ON 23.03.2016 THE ASSESSEE WAS ASKED TO PRODUCE SALES LEDGER FOR THE FINANCIAL YEAR 2012-13 AND WAS ALSO ASKED TO EXPLAIN AS TO WHY THE CLAIM OF 44F OF THE ACT SHOULD NOT BE REVOKED BASED ON THE FACTS ON RECORD. THE ASSESSEE DID NOT PRODUCE ANY LEDGER FOR THE SAME. NO EXPLANATORY NOTES OR ORIGINAL BOOKS OF ACCOUNT HAVE BEEN FILED OR PRODUCED BY THE ASSESSEE IN SUPPORT OF THESE CLAIMS DURING THE COURSE OF THE ENTIRE ASSESSMENT PROCEEDINGS AND THE SAME HAVE BEEN DEALT AT LENGTH IN THE ASSESSMENT ORDER DATED 30.03.2016. THE ONUS OF MAINTAINING BOOKS OF ACCOUNT ARE CLEARLY ENUNCIATED IN SECTION 44AA OF THE ACT. THE ASSESSEE HAS CLAIMED DEEMED PROFITS UNDER SECTION 44AF OF THE ACT AND OFFERED 5% AS INCOME ON GROSS RECEIPTS. HOWEVER TO BE ELIGIBLE FOR THE BENEFIT OF SECTION 44AF OF THE ACT THE PROVISO TO SUB-SECTION (1) MANDATES THAT THE TOTAL TURNOVER SHOULD NOT EXCEED FORTY LAKH RUPEES. IN THIS CASE THE TOTAL TURNOVER IS .52 03 594/-. HENCE 44AF OF THE ACT IS NOT AVAILABLE TO THIS ASSESSEE AND THE SAME HAVE BEEN DISCUSSED IN THE ASSESSMENT ORDER PASSED ON 30.03.2016. ITA NO.386/CHNY/2019 :- 3 -: 3. THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UNDER SECTION 271A OF THE ACT AND NOTICE WAS ISSUED ON 30.03.2016. A REMINDER WAS ISSUED ON 07.09.2016 POSTING THE CASE ON 14.09.2016. THE ASSESSEE DID NOT APPEAR NOR ANY REPLY BEEN FILED. ACCORDINGLY THE ASSESSING OFFICER LEVIED PENALTY OF .25 000/- AGAINST WHICH THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A). AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE THE LD. CIT(A) CONFIRMED THE PENALTY LEVIED UNDER SECTION 271A OF THE ACT. 4. ON BEING AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. BY REITERATING THE SUBMISSIONS AS MADE BEFORE THE LD. CIT(A) THE LD. COUNSEL FOR THE ASSESSEE PRAYED FOR DELETING THE PENALTY LEVIED UNDER SECTION 271A OF THE ACT. ON THE OTHER HAND THE LD. DR STRONGLY SUPPORTED THE ORDER OF THE LD. CIT(A). 5. WE HAVE HEARD BOTH THE SIDES PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IN THIS CASE THE ASSESSEE IS IN THE BUSINESS OF LIVESTOCK POULTRY. THE ASSESSEE HAS CLAIMED DEEMED PROFITS UNDER SECTION 44AF OF THE ACT AND OFFERED 5% AS INCOME ON GROSS RECEIPTS. HOWEVER TO BE ELIGIBLE FOR THE BENEFIT OF SECTION 44AF OF THE ACT THE PROVISO TO SUB-SECTION (1) MANDATES THAT THE TOTAL TURNOVER SHOULD NOT EXCEED FORTY LAKH RUPEES. IN THIS CASE THE TOTAL TURNOVER IS .52 03 594/- AND HENCE 44AF IS NOT AVAILABLE TO THIS ASSESSEE WHICH WAS DISCUSSED IN THE ASSESSMENT ORDER PASSED ON 30.03.2016. AFTER REPRODUCING THE PROVISIONS AND ITA NO.386/CHNY/2019 :- 4 -: ELABORATELY DISCUSSING THE ISSUE THE LD. CIT(A) CONFIRMED THE PENALTY LEVIED UNDER SECTION 271A OF THE ACT. 6. THE WRITTEN SUBMISSIONS MADE BEFORE THE LD. CIT(A) ON 03.01.2019 BY THE AR OF THE ASSESSEE ARE REPRODUCED AS UNDER: FOR THE ASSESSMENT YEAR 2013-14 A SUM OF .25 000/- HAS BEEN LEVIED U/S.271A FOR NON-MAINTENANCE OF BOOKS OF ACCOUNTS. I HAVE FILED THE RETURN OF INCOME ADMITTING A TURNOVER OF .52 03 594/- I HAVE ESTIMATED A PROFIT OF 8% WHILE FILING THE RETURN. MY APPEAL AGAINST THE ASSESSMENT U/S.143(3) FOR THE ASSESSMENT YEAR 2013-14 IS PENDING BEFORE THE LD CIT APPEALS-15 AS ON DATE. I AM IN THE BUSINESS OF LIVESTOCK OF POULTRY. IN RESPECT OF SECTION 44AF THE ASSESSEE IS ELIGIBLE FOR TURNOVER UPTO 1 CRORE FOR THE ASSESSMENT YEAR 2013-14 AND NOT 40 LAKHS AS STATED BY THE ASSESSING OFFICER IN PENALTY ORDER PARA-3 PAGE NOOF THE ORDER. HENCE THE PENALTY HAS BEEN LEVIED ON WRONG FACTS AND DESERVES TO BE CANCELLED. AS THE ASSESSEE ESTIMATED THE INCOME UNDER SECTION 44AF AND THE TURNOVER IS BELOW 1 CRORE THE ASSESSEE DID NOT MAINTAIN ACCOUNTS. THE ASSESSEE IS IN THE BUSINESS OF LIVESTOCK POULTRY BUSINESS AND THE GOVERNMENT HAS GIVEN CONCESSION ON CERTAIN SECTIONS OF THE INCOME TAX ACT FOR LIVESTOCK AND POULTRY BUSINESS. AND AS SUCH AS I HAVE ESTIMATED INCOME AT 8% OF THE TURNOVER OF THE U/S.44AF (UPTO 1 CRORE) (AND NOT 40 LAKHS AS STATED BY THE ASSESSING OFFICER). I REQUEST YOU TO KINDLY CANCEL THE PENALTY. I HAVE REASONABLE AND SUFFICIENT CAUSE FOR NOT MAINTAINING IN THE BOOKS OF ACCOUNTS SINCE MY INCOME IS ESTIMATED U/S.44AF. I REQUEST YOU TO KINDLY CANCEL THE PENALTY LEVIED ON ME. BY REITERATING THE ABOVE SUBMISSIONS THE LD. COUNSEL HAS PRAYED FOR DELETING THE PENALTY. HOWEVER ON PERUSAL OF THE RELEVANT PROVISIONS WE FIND THAT NEITHER THE ASSESSEE FILED AND DOCUMENT HAVING ENHANCED THE ABOVE CEILING OF .40 LAKHS TO . 1.00 CRORE NOR ANY AMENDMENT MADE WAS BROUGHT ON RECORD. ITA NO.386/CHNY/2019 :- 5 -: THUS THE ABOVE CONTENTION OF THE LD. COUNSEL IS BASELESS. ADMITTEDLY THE ASSESSEE HAS NOT MAINTAINED THE BOOKS OF ACCOUNTS AS REQUIRED UNDER SECTION 44AA OF THE ACT AS HAS BEEN MADE IN THE WRITTEN SUBMISSIONS. MOREOVER THE QUANTUM ADDITION HAS NOTHING TO DO WITH THE PENALTY LEVIED UNDER SECTION 271A OF THE ACT SINCE THE ASSESSEE WAS IN DEFAULT AS REQUIRED UNDER SECTION 44AA OF THE ACT THE LEVY OF PENALTY UNDER SECTION 271A OF THE ACT WAS RIGHTLY CONFIRMED BY THE LD. CIT(A). THUS THE GROUND RAISED BY THE ASSESSEE STANDS DISMISSED. 7. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON THE 27 TH NOVEMBER 2019 IN CHENNAI. SD/- SD/- (INTURI RAMA RAO) ACCOUNTANT MEMBER (DUVVURU RL REDDY) JUDICIAL MEMBER CHENNAI DATED 27.11.2019 VM/- /COPY TO: 1. /APPELLANT 2. / RESPONDENT 3. ( )/CIT(A) 4. /CIT 5. /DR & 6. /GF.