IBRAHIM MIRA TAMBOLI, MUMBAI v. ITO 22(1)(2), NAVI MUMBAI

ITA 881/MUM/2015 | 2010-2011
Pronouncement Date: 05-10-2016 | Result: Partly Allowed

Appeal Details

RSA Number 88119914 RSA 2015
Assessee PAN ABTPT5212B
Bench Mumbai
Appeal Number ITA 881/MUM/2015
Duration Of Justice 1 year(s) 7 month(s) 26 day(s)
Appellant IBRAHIM MIRA TAMBOLI, MUMBAI
Respondent ITO 22(1)(2), NAVI MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 05-10-2016
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted SMC
Tribunal Order Date 05-10-2016
Assessment Year 2010-2011
Appeal Filed On 09-02-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC MUMBAI BEFORE SHRI G.S.PANNU ACCOUNTANT MEMBER ITA NO. 881 /MUM/2015 (ASSESSMENT YEAR : 2010-11) SHRI. IBRAHIM MIRA TAMBOLI 104 BAIYA SAHEB NAGAR BEHIND MASJID RAMABAHI ABDEKAR COLONY GHATKOPAR (E) MUMBAI 400077 PAN: ABTPT 5212B ... APPELLANT VS. THE INCOME TAX OFFICER 22(1)(2) VASHI NAVI MUMBAI. .... RESPONDENT APPELLANT BY : SHRI VENUGOPAL NAIR RESPONDENT BY : SHRI SUMIT KUMAR DATE OF HEARING : 01/09/2016 DATE OF PRONOUNCEMENT : 05/10/2016 ORDER THE CAPTIONED APPEAL FILED BY THE ASSESSEE PERTAIN ING TO ASSESSMENT YEAR 2010-11 IS DIRECTED AGAINST AN ORDE R PASSED BY CIT(A)- 25 MUMBAI DATED 01/12/2014 WHICH IN TURN ARISES O UT OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3 ) OF THE INCOME TAX ACT 1961 (IN SHORT THE ACT) DATED 17/12/20 13. 2. IN THIS APPEAL ASSESSEE HAS RAISED THE FOLLOWIN G GROUNDS OF APPEAL:- 1. THE LEARNED CIT (A) ERRED IN FACTS AND CIRCUMST ANCES OF THE CASE AND IN LAW IN FRAMING ORDER WITHOUT PROVIDING EVEN A SINGL E OPPORTUNITY AFTER THE CHANGE OF JURISDICTION OF COMMISSIONER OF INCOME TA X (APPEALS) FROM CIT(A)- 33 TO CIT(A)-25 WITHOUT PREJUDICE TO THE ABOVE. 2 ITA NO. 881 /MUM/2015 (ASSESSMENT YEAR : 2010-11) 2. THE LEARNED CIT (A) ERRED IN FACTS AND CIRCUMSTA NCES OF THE CASE AND IN LAW IN HOLDING THE ASSESSMENT THAT THE AO FRAMED IS AS PER TERMS OF CBDT INSTRUCTION ON THE SUBJECT. 3. THE LEARNED CIT (A) ERRED IN FACTS AND CIRCUMSTA NCES OF THE CASE AND IN LAW IN CONFIRMING ADHOC ADDITION BY 30% OF MATERIAL PURCHASES. 4. THE LEARNED CIT (A) ERRED IN FACTS AND CIRCUMSTA NCES OF THE CASE AND IN LAW IN CONFIRMING AD HOC ADDITION BY 20% OF LABOUR CHAR GES. 5. THE LEARNED CIT (A) ERRED IN FACTS AND CIRCUMSTA NCES OF THE CASE AND IN LAW IN CONFIRMING ADDITION BY DISALLOWING BONUS UNDER S ECTION 43B OF INCOME TAX ACT 1961. 6. THE LEARNED CIT(A) ERRED IN FACTS AND CIRCUMSTAN CES OF THE CASE AND IN LAW IN CONFIRMING AD HOC ADDITION BY 20% OF BONUS PAYME NTS. 7. THE LEARNED CIT (A) ERRED IN FACTS AND CIRCUMSTA NCES OF THE CASE AND IN LAW IN CONFIRMING ADHOC ADDITION ON ACCOUNT OF CONV EYANCE REPAIRS AND STAFF WELFARE EXPENSES. 8. THE LEARNED CIT (A) ERRED IN FACTS AND CIRCUMSTA NCES OF THE CASE AND IN LAW IN CONFIRMING ACTION OF NOT ACCEPTING REVISED C OMPUTATION OF INCOME FURNISHED DURING ASSESSMENT PROCEEDINGS. REASONS GIVEN BY LEARNED CIT (A) FOR CONFIRMING THE ADDITIONS ARE WRONG INSUFFICIENT AND CONTRARY TO FACTS AND EVIDENCE ON RECORD AND IN LAW. 2. THOUGH THE APPELLANT HAS RAISED MULTIPLE GROUNDS OF APPEAL BUT NONE OF THEM WAS PRESSED AT THE TIME OF HEARING EXC EPT RAISING A SINGULAR ARGUMENT THAT THE BUSINESS PROFIT ASSESSE D BY THE INCOME TAX AUTHORITIES IS ON A HIGHER SIDE. THE LD. REPRESENT ATIVE FOR THE ASSESSEE SUBMITTED THAT THE APPELLANT ASSESSEE IS AN INDIVID UAL WHO IS A PROPRIETOR OF M/S. SHINE CONSTRUCTION ENGAGED IN T HE BUSINESS OF CIVIL CONTRACTING. IT WAS FURTHER EXPLAINED THAT ASSESSE E HAS PRIMARILY RENDERED SERVICES TO GOVERNMENT DEPARTMENT NAMEL Y CPWD . IT WAS EXPLAINED THAT ASSESSEE HAD FILED THE RETURN OF INC OME DECLARING A TOTAL INCOME OF RS.5 04 662/- WHICH WAS AROUND 6% OF THE GROSS RECEIPTS. IN THE COURSE OF SCRUTINY ASSESSMENT VARIOUS DISALLOW ANCES HAVE BEEN MADE OUT OF PURCHASES LABOUR CHARGES STAFF WELFAR E BONUS 3 ITA NO. 881 /MUM/2015 (ASSESSMENT YEAR : 2010-11) TRANSPORTATION ETC. WHEREBY THE TOTAL INCOME HAS BEEN ASSESSED AT RS.38 20 890/-. THE LD. REPRESENTATIVE FOR THE ASSE SSEE POINTED OUT THAT IF THE AFORESAID LEVEL OF INCOME IS ASSESSED IT WOULD REFLECT A NET PROFIT RATE OF 40% WHICH IS EXTREMELY EXCESSIVE IN SUCH LINE OF BUSINESS. IT HAS BEEN POINTED OUT THAT THE ENTIRE SERVICES HA D BEEN RENDERED TO CPWD AND THAT THE ASSESSEE WOULD BE SATISFIED IF A REASONABLE RATE OF PROFIT IS APPLIED TO COMPUTE HIS INCOME FROM THE BU SINESS OF CIVIL CONTRACTING. 3. ON THIS ASPECT LD. DEPARTMENTAL REPRESENTATIVE HAS NOT SERIOUSLY OPPOSED THE PLEA OF THE ASSESSEE FOR DETERMINATION OF INCOME ON AN ESTIMATE BASIS. 4. IN THE ABOVE BACK GROUND THE ORDERS OF THE AUTH ORITIES BELOW HAVE BEEN PERUSED. THE ORDERS PASSED BY THE ASSESS ING OFFICER AND THEREAFTER BY THE CIT(A) REVEAL THAT ESSENTIALLY A DDITIONS HAVE BEEN MADE ON ESTIMATE BASIS OUT OF VARIOUS HEADS OF EXPE NDITURE DEBITED IN THE P&L ACCOUNT. IT ALSO TRANSPIRES THAT THE ASSES SEE COULD NOT SATISFACTORILY PRODUCE THE REQUIRED RECORD IN ORDER TO ENABLE THE ASSESSING OFFICER TO VERIFY THE VARIOUS EXPENDITURE S DEBITED IN THE P&L ACCOUNT. IT HAS ALSO SEEN BY THE ASSESSING OFFICE R THAT FOR THE EARLIER ASSESSMENT YEAR OF 2009-10 ASSESSEE HAD DECLARED TH E INCOME ON A PRESUMPTIVE BASIS IN TERMS OF SECTION 44AD OF THE A CT. NO SPECIFIC ARGUMENTS HAD BEEN RAISED FOR ANY OF THE ISSUES BEF ORE US EXCEPT REGARDING THE REASONABLENESS OF THE DETERMINATION O F FINAL INCOME FROM BUSINESS. ON THIS ASPECT THE PLEA OF THE ASSESSEE THAT THE FINAL ASSESSED INCOME IS EXCESSIVE CONSIDERING THE NATUR E OF BUSINESS IS QUITE PLAUSIBLE. THEREFORE CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES OF 4 ITA NO. 881 /MUM/2015 (ASSESSMENT YEAR : 2010-11) THE CASE IT WOULD BE IN THE FITNESS OF THINGS THAT THE NET PROFIT FROM THE BUSINESS BE ESTIMATED AT 10% OF THE GROSS RECEIPTS. ACCORDINGLY THE MATTER IS RESTORED BACK TO THE FILE OF ASSESSING OF FICER TO RECOMPUTE THE INCOME FROM BUSINESS OF CIVIL CONTRACTING AT 10% OF GROSS PROFITS AND NO INDIVIDUAL ADDITIONS BE MADE OUT OF ITEMS OF EXPEND ITURE REFERABLE TO THE GROSS RECEIPTS OF SUCH BUSINESS. 5. THUS THE APPEAL OF THE ASSESSEE IS PARTLY ALLOW ED AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 05/10/2016 SD/- (G.S. PANNU) ACCOU NTANT MEMBER MUMBAI DATED 05/10/2016 VM SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR ITAT MUMBAI 6. GUARD FILE. BY ORDER //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT MUMBAI