Sh. Surinder Nayyar, Delhi v. ACIT, New Delhi

ITA 4638/DEL/2015 | 2009-2010
Pronouncement Date: 30-09-2016 | Result: Allowed

Appeal Details

RSA Number 463820114 RSA 2015
Assessee PAN AAKPN4073C
Bench Delhi
Appeal Number ITA 4638/DEL/2015
Duration Of Justice 1 year(s) 2 month(s) 16 day(s)
Appellant Sh. Surinder Nayyar, Delhi
Respondent ACIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 30-09-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC 2
Tribunal Order Date 30-09-2016
Date Of Final Hearing 02-08-2016
Next Hearing Date 02-08-2016
Assessment Year 2009-2010
Appeal Filed On 14-07-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC-II NEW DELHI BEFORE SMT DIVA SINGH JUDICIAL MEMBER I.T.A .NO.-4 636/DEL/2015 (ASSESSMENT YEAR-2009-10) MANISH NAYYAR 16/46 SUBHASH NAGAR DELHI-110027. PAN-AAKPN4073C (APPELLANT) VS ACIT CIRCLE-45(1) CIVIC CENTRE NEW DELHI (RESPONDENT) I.T.A .NO.-4638/DEL/2015 (ASSESSMENT YEAR-2009-10) SURINDER NAYYAR 16/46 SUBHASH NAGAR DELHI-110027. PAN-AAJPP5723G (APPELLANT) VS ACIT CIRCLE-45(1) CIVIC CENTRE NEW DELHI (RESPONDENT) ASSESSEE BY SH.K.SAMPATH ADV. & SH. SH.V.RAJA KUMAR ADV. REVENUE BY MS. ANIMA BARNWAL SR.DR ORDER BOTH THESE APPEALS ARE BEING DECIDED BY A COMMON OR DER AS IDENTICAL ISSUES ARE AGITATED BY THE TWO DIFFERENT ASSESSEES IN THE PRE SENT APPEALS. ITA NO.4636/DEL/2015 HAS BEEN FILED BY THE ASSESSEE ASSAILING THE CORREC TNESS OF THE ORDER DATED 15.05.2015 OF CIT(A)-15 PERTAINING TO 2009-10 AY; ITA NO.4638/DEL /2015 HAS ALSO BEEN FILED BY THE ASSESSEE PERTAINING TO SAME ASSESSMENT YEAR ASSAILI NG THE CORRECTNESS OF AN IDENTICAL ORDER PASSED BY THE VERY SAME AUTHORITY ON THE VERY SAME DATE. THE GROUNDS RAISED BY THESE TWO DIFFERENT ASSESSEES ARE IDENTICAL. FOR READY- REFERENCE THE GROUNDS FROM ITA NO.4636/DEL/2015 ARE REPRODUCED HEREUNDER:- DATE OF HEARING 02.08.2016 DATE OF PRONOUNCEMENT 30 .09.2016 I.T.A .NO.-4636 & 4638/DEL/2015 PAGE 2 OF 4 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD.CIT(A) ERRED IN CONFIRMING THE VALIDITY OF THE PROCEEDINGS U/S 147/148 OF THE INCOME TAX ACT 1961 WHICH DUE TO INHERENT DEFICIEN CY DEFECTS AND FALLACY OUGHT TO HAVE BEEN QUASHED. 2. WITHOUT PREJUDICE TO THE FOREGOING THE LD.CIT(A) ER RED IN CONFIRMING A 9% RATE OF RETURN WHICH BEING ARBITRARY AND WITHOUT AN Y BASIS OUGHT TO BE QUASHED AND THE RATE AS RETURNED BY THE APPELLANT O UGHT TO BE DIRECTED TO BE ADOPTED AND APPLIED. 2. THE LD.AR INVITING ATTENTION TO THE MATERIAL AVA ILABLE ON RECORD SUBMITTED THAT IN BOTH THE YEARS THE ASSESSING OFFICER SOLELY TO EN HANCE THE PROFIT RATE RE-OPENED THE CASES AFTER ISSUANCE OF NOTICE. THE EXERCISE OF POWER CH ALLENGED IN APPEAL IT WAS SUBMITTED WAS DISMISSED BY THE CIT(A) HOLDING THAT THE ISSUES WHE THER THE REASONS WERE COMMUNICATED TO THE ASSESSEE OR NOT IS AN ACADEMIC. IT WAS SUBM ITTED THAT ON THESE ABOVE FACTS ALONE THE ASSESSEE IS CONFIDENT THAT RELIEF WAS ALLOWABLE HOWEVER HE WOULD ALSO LIKE TO BRING CERTAIN OTHER FACTS ON RECORD NAMELY THAT THE ASSES SEE IS A REGISTERED GOVERNMENT CONTRACTOR UNDER CLASS IV B&R WITH MCD/CPWD AND AS PER CPWD/CONTRACTEES REQUIREMENT; HE HAS TO EMPLOY ONE DIPLOMA ENGINEER FOR SUPERVISION OF WORK ALLOTTED TO HIM. BECAUSE OF THIS THE DIRECT EXPENSES OF THE A SSESSEE ARE INCREASED. IN THE CIRCUMSTANCES 6% PROFIT RATE IT WAS SUBMITTED WAS JUSTIFIED. IT WAS ALSO SUBMITTED THAT THE ASSESSING OFFICER IN AY 2007-08 HAS ACCEPTED N ET PROFIT @7% IN ASSESSEES OWN CASE. 3. IT WAS HIS SUBMISSION THAT WHEREAS THE AO HAS AP PLIED THE RATE OF 12% THE CIT(A HAD REDUCED IT TO 9% HOLDING THAT PARTLY THE ASSESS EE IS RIGHT AND THE AO IS RIGHT. HOWEVER IT WAS HIS SUBMISSION ADMITTEDLY THE FACTS AND CIRCUMSTANCES OF THE ASSESSEE REMAINS THE SAME OVER THE YEARS AND AS PER THE PAST HISTORY OF THE ASSESSEE ON THE ISSUE WHERE ADMITTEDLY BOOKS OF ACCOUNTS HAVE NOT BEEN MA INTAINED AND THE ASSESSEE CONTINUES TO BE A CONTRACTOR OF THE SAME CLASS IN THE YEAR UN DER CONSIDERATION ALSO THE RATE OF 7% ACCEPTED BY THE TAX AUTHORITIES SHOULD BE ACCEPTED. ACCORDINGLY IT WAS HIS SUBMISSION THAT I.T.A .NO.-4636 & 4638/DEL/2015 PAGE 3 OF 4 EVEN IF THE ASSESSEE FOR PEACE OF MIND DOES NOT WAN T TO CONTEST THE RE-OPENING THE FACTS REMAINS THAT PROFIT RATE OF 7% HAS BEEN ACCEPTED BY THE REVENUE. INVITING ATTENTION TO THE IMPUGNED ORDER DATED 15.05.2015 IT WAS HIS SUBMISSI ON THAT PAPER BOOK PAGE 19 TO 22 WOULD SHOW THAT THE AO IN 2013-14 AY BY HIS ORDER U /S 143 DATED 05.02.2016 HAS ACCEPTED THE TAX RATE OF 7% OF NET PROFIT GROSS PR OFIT. ACCORDINGLY IT WAS HIS PRAYER THAT FOR VERIFYING THAT FACT THE MATTER MAY BE RESTORED DIRECTING APPROPRIATE RELIEF ON VERIFICATION. 4. LD.SR.DR MS.ANIMA BARANWAL VEHEMENTLY ARGUED TH AT IT IS THE DUTY OF ASSESSEE TO FILE AND MAINTAIN BOOKS OF ACCOUNTS ACCORDINGLY THE ARGUMENT THAT THE NET PROFIT RATE ACCEPTED IN THE PAST MUST BE APPLIED DOES NOT MAKE ANY SENSE. 5. HAVING HEARD THE SUBMISSIONS AND PERUSED THE MAT ERIAL AVAILABLE ON RECORD. I FIND THAT THOUGH THE ASSESSEE AFTER CHALLENGING THE JURI SDICTION PROCEEDINGS TO FOCUS HIS PRAYER TO THE ACCEPTANCE OF TAX RATE ACCEPTED BY THE REVEN UE IN ASSESSEES OWN CASE HOWEVER I FIND THAT THE GROUND ASSAILING JURISDICTION HAS NOT BEEN GIVEN UP OR WITHDRAWN. SINCE THE CHALLENGE REMAINS ON RECORD IT CANNOT BE IGNORED. CONSIDERING THE CHALLENGE AND THE GRIEVANCE IT IS DEEMED APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER ON THE GROUNDS THAT THE CONCLUSION ARRIVED AT BY THE CIT(A) CANNOT BE U PHELD. THE DUTY OF COMMUNICATING THE REASONS IS AN IMPORTANT STEP IT CANNOT BE CIRC UMVENTED. THE REASONS FOR RE-OPENING HAVE TO BE COMMUNICATED AND IF CHALLENGED THAT THER E IS NO COMMUNICATION IT CANNOT BE BRUSHED ASIDE AS AN ACADEMIC ISSUE. THE ISSUE IS RE STORED BACK TO THE CIT(A) WITH A DIRECTION TO FIRST DECIDE THE JURISDICTIONAL ISSUE AND THEN IF NEED BE PROCEED TO THE MERITS OF THE ADDITIONS. IT MAY NOT BE OUT OF PLACE TO MAKE IT CLEAR THAT INCASE ESTIMATES ARE RESORTED TO THEN THE EXERCISE IS TO BE UNDERTAKEN A S PER SETTLED LEGAL PRINCIPLES. THE COURTS I.T.A .NO.-4636 & 4638/DEL/2015 PAGE 4 OF 4 HAVE BEEN CATEGORICAL IN HOLDING THAT IF ESTIMATE H AD TO BE RESTORED THEN THE ASSESSEES OWN PAST HISTORY CAN GENERALLY BE THE BEST GUIDE AN D INCASE OF INAPPLICABILITY OF THE SAME THEN COMPARISON WITH IDENTICALLY SITUATED PERSONS DURING THE SAME TIME WITHIN THE AREA IS THE BEST JUDGE. NEEDLESS TO SAY THE EVIDENCE COLLE CTED AND APPLIED HAS TO BE CONFRONTED TO THE ASSESSEE. ACCORDINGLY IN VIEW OF THESE OBVIOU S DEFICIENCIES AND SHORTCOMING IN THE ORDERS UNDER CHALLENGE THE ISSUES ARE RESTORED TO T HE FILE OF THE CIT(A) WITH A DIRECTION TO PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. 6. IN THE RESULT THE APPEALS OF THE ASSESSEE ARE A LLOWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 30 TH OF SEPTEMBER 2016. SD/- (DIVA SINGH) JUD ICIAL MEMBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI