Shri Narain Das Bhatia S/o Wadhumal Bhatia,, Indore v. The ACIT, Indore

MA 2/IND/2011 | 2007-2008
Pronouncement Date: 25-03-2011 | Result: Dismissed

Appeal Details

RSA Number 222724 RSA 2011
Assessee PAN ACIPB4351M
Bench Indore
Appeal Number MA 2/IND/2011
Duration Of Justice 2 month(s) 7 day(s)
Appellant Shri Narain Das Bhatia S/o Wadhumal Bhatia,, Indore
Respondent The ACIT, Indore
Appeal Type Miscellaneous Application
Pronouncement Date 25-03-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted SMC
Tribunal Order Date 25-03-2011
Assessment Year 2007-2008
Appeal Filed On 17-01-2011
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH JUDICIAL MEMBER AND SHRI R.C. SHARMA ACCOUNTANT MEMBER MISCELLANEOUS PETITION NOS.2 & 3/IND/2011 (ARISING OUT OF ITA NOS. 169 & 170/IND/2010) A.Y. 2007-08 NARAIN DAS BHATIA INDORE PAN ACIPB 4351 M AND SMT. SHEELA BHATIA INDORE PAN AGVPB 2744 D APPLICANTS VS. ACIT-3(1) INDORE RESPONDENT APPLICANT BY : S/SH. H.P. VERMA & GIRISH AGRAWAL RESPONDENT BY : SH. PRADEEP KUMAR MITRA SR. DR O R D E R PER JOGINDER SINGH THESE MISCELLANEOUS PETITIONS U/S 254(2) OF THE AC T ARE FILED BY THE ASSESSEES SEEKING RECALLING OF THE EXPARTE ORDER OF TRIBUNAL DATED 2.12.2010. 2. DURING HEARING OF THE MISCELLANEOUS PETITION MR . H.P. VERMA ALONG WITH SHRI GIRISH AGRAWAL LD. COUNSEL FOR THE ASSES SEE. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT DURING HEARING OF MAIN APPEALS IT WAS PRONOUNCED BY THE BENCH THAT THE DISALLOWANCE WILL BE RESTRICTED TO 10% OF GROSS RECEIPTS BUT THE SAME HAS NOT BEEN FOUND IN T HE ORDER. THE LD. COUNSEL FOR THE ASSESSEE REITERATED ITS SUBMISSIONS AS HAS BEEN MENTIONED IN THE 2 MISCELLANEOUS PETITIONS. ON THE OTHER HAND SHRI PR ADEEP KUMAR MITRA LD. SR. DR RELIED UPON THE ORDER OF THE TRIBUNAL BY CON TENDING THAT THERE IS NO ERROR IN THE ORDER AND THE ASSESSEES ARE MERELY TRY ING TO GET THE ORDER REVIEWED WHICH POWER IS NOT AVAILABLE WITH THE TRIB UNAL. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATERIAL AVAILABLE ON RE CORD. WE HAVE ALSO PERUSED THE LOG-BOOK AND THE NOTINGS MADE THEREIN O N 2.12.2010 AND FOUND THAT THE BENCH PRONOUNCED THAT THE DISALLOWANCE OF EXPENDITURE IS TO BE RESTRICTED TO 10% IN PLACE OF 20% MADE BY THE ASSES SING OFFICER. IN VIEW OF THESE FACTS THE CLAIM OF THE ASSESSEE IS NOT SUBST ANTIATED WITH FACTS. THE FINDINGS OF THE TRIBUNAL AS CONTAINED IN PARA 3 ONW ARDS OF THE ORDER DATED 2.12.2010 IS REPRODUCED HEREUNDER: 3. SO FAR AS GROUND NO. 2 IS CONCERNED THE CONTENTION RAISED ON BEHALF OF THE ASSESSEE IS THAT AD HOC DISALLOWANCE WAS MADE BY THE LEARNED ASSESSING OFFICER AS THE RESPECTIVE ASSESSEES WERE UNDER A BONAFIDE BELIEF THAT NET PROFIT AT THE RATE OF 8% O F GROSS RECEIPTS WILL MEET THE ENDS OF JUSTICE CONSIDERING THE NATURE OF BUSINESS THEREFORE THE AD-HOC DISALLOWA NCE AT THE RATE OF 20% OF THE EXPENSES IS QUITE UNJUSTI FIED. ON THE OTHER HAND THE LEARNED SENIOR DEPARTMENTAL REPRESENTATIVE DEFENDED THE IMPUGNED ORDERS BY SUBMITTING THAT SINCE THE ASSESSEES ARE NOT MAINTAINING PROPER BOOKS OF ACCOUNTS THEREFORE TH ERE WAS NO ALTERNATIVE WITH THE ASSESSING OFFICER BUT T O MAKE THE DISALLOWANCE. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. BRIEF FACTS ARE THAT THE ASSES SEES ARE SENIOR CITIZENS ARE NOT MAINTAINING BOOKS OF ACCOUNTS. SHRI NARAINDAS BHATIA DECLARED TOTAL INC OME OF RS.1 86 160/- AND SMT. SHEELA BHATIA DECLARED TO TAL 3 INCOME OF RS.1 26 660/- IN THEIR RESPECTIVE RETURNS FILED ON 28.7.2007 AND 28.10.2007 RESPECTIVELY. THE ASSESSEES ARE HUSBAND AND WIFE AND ARE RUNNING VEHICLES LIKE 3 TATA BUS AND 2 SUMO JEEP DECLARED INCOME THEREFROM ON ESTIMATE BASIS. THE ASSESSEES WERE ASKED BY THE ASSESSING OFFICER TO FURNISH THE TENTATIVE INCOME AND EXPENDITURE ACCOUNTS OF THESE VEHICLES ALONG WITH SOURCE OF INVESTMENT. AS PER TH E REVENUE NO REPLY WAS FILED TO THE QUERY RAISED. THEREFORE THE ASSESSING OFFICER DISALLOWED 20% OF EXPENSES CLAIMED BY THE ASSESSEES WHICH WORKED OUT TO RS.3 03 410/- AND RS.6 07 753/- WHICH WERE TREAT ED AS UNDISCLOSED INCOME FROM RUNNING OF VEHICLES AND ADDED TO THE TOTAL INCOME OF THESE ASSESSEES AGAINS T THE INCOME SHOWN AT THE RATE OF 8% BY THESE ASSESSEES AS PER THE PROVISIONS OF SECTION 44AD OF THE ACT. ON APPEAL ADDITIONS WERE CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) WHICH IS UNDER CHALLENGED BEFORE THE TRIBUNAL. BEFORE COM ING TO ANY CONCLUSION WE ARE REPRODUCING HEREUNDER THE PROVISIONS OF SECTION 44AD OF THE ACT :- 65 SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS O F BUSINESS OF CIVIL CONSTRUCTION ETC. 44AD. (1) NOTWITHSTANDING ANYTHING TO THE CONTRARY CONT AINED IN SECTIONS 28 TO 43C IN THE CASE OF AN ASSESSEE ENGAGED IN THE BUSINES S OF CIVIL CONSTRUCTION OR SUPPLY OF LABOUR FOR CIVIL CONSTRUC TION A SUM EQUAL TO EIGHT PER CENT OF THE GROSS RECEIPTS PAID OR PAYABL E TO THE ASSESSEE IN THE PREVIOUS YEAR ON ACCOUNT OF SUCH BUSINESS OR A S THE CASE MAY BE A SUM HIGHER THAN THE AFORESAID SUM AS DECLARED BY TH E ASSESSEE IN HIS RETURN OF INCOME SHALL BE DEEMED TO BE THE PROFITS AND GAINS OF SUCH BUSINESS CHARGEABLE TO TAX UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION: PROVIDED THAT NOTHING CONTAINED IN THIS SUB-SECTION SHALL A PPLY IN CASE THE AFORESAID GROSS RECEIPTS PAID OR PAYABLE EXCEED AN AMOUNT OF FORTY LAKH RUPEES. (2) ANY DEDUCTION ALLOWABLE UNDER THE PROVISIONS OF SECTIONS 30 TO 38 SHALL FOR THE PURPOSES OF SUB-SECTION (1) BE DEEMED TO HAVE BEEN ALREADY GIVEN FULL EFFECT TO AND NO FURTHER DEDUCTION UNDER THOSE SECTIONS SHALL BE ALLOWED : 66 [ PROVIDED THAT WHERE THE ASSESSEE IS A FIRM THE SALARY AND I NTEREST PAID TO ITS PARTNERS SHALL BE DEDUCTED FROM THE INCOME COMPUTED UNDER SUB- SECTION (1) SUBJECT TO THE CONDITIONS AND LIMITS SP ECIFIED IN CLAUSE (B) OF SECTION 40 .] (3) THE WRITTEN DOWN VALUE OF ANY ASSET USED FOR TH E PURPOSE OF THE BUSINESS REFERRED TO IN SUB-SECTION (1) SHALL BE DEEMED TO H AVE BEEN CALCULATED 4 AS IF THE ASSESSEE HAD CLAIMED AND HAD BEEN ACTUALL Y ALLOWED THE DEDUCTION IN RESPECT OF THE DEPRECIATION FOR EACH O F THE RELEVANT ASSESSMENT YEARS. (4) THE PROVISIONS OF SECTIONS 44AA AND 44AB SHALL NOT APPLY IN SO FAR AS THEY RELATE TO THE BUSINESS REFERRED TO IN SUB-SECTION ( 1) AND IN COMPUTING THE MONETARY LIMITS UNDER THOSE SECTIONS THE GROSS RECEIPTS OR AS THE CASE MAY BE THE INCOME FROM THE SAID BUSINESS SHAL L BE EXCLUDED. 67 [(5) NOTHING CONTAINED IN THE FOREGOING PROVISIONS OF THIS SECTION SHALL APPLY WHERE THE ASSESSEE CLAIMS AND PRODUCES EVIDENCE TO PROVE THAT THE PROFITS AND GAINS FROM THE AFORESAID BUSINESS DURIN G THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR COMMENCING ON THE 1 ST DAY OF APRIL 1997 OR ANY EARLIER ASSESSMENT YEAR ARE LOWER THAN THE PROFITS AND GAINS SPECIFIED IN SUB-SECTION (1) AND THEREUPON T HE ASSESSING OFFICER SHALL PROCEED TO MAKE AN ASSESSMENT OF THE TOTAL IN COME OR LOSS OF THE ASSESSEE AND DETERMINE THE SUM PAYABLE BY THE ASSES SEE ON THE BASIS OF ASSESSMENT MADE UNDER SUB-SECTION (3) OF SECTION 14 3.] 68 [(6) NOTWITHSTANDING ANYTHING CONTAINED IN THE FORE GOING PROVISIONS OF THIS SECTION AN ASSESSEE MAY CLAIM LOWER PROFITS AND GA INS THAN THE PROFITS AND GAINS SPECIFIED IN SUB-SECTION (1) IF HE KEEPS AND MAINTAINS SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS AS REQUIRED UN DER SUB-SECTION (2) OF SECTION 44AA AND GETS HIS ACCOUNTS AUDITED AND FURNISHES A REPORT OF SUCH AUDIT AS REQUIRED UNDER SECTION 44AB .] EXPLANATION.FOR THE PURPOSES OF THIS SECTION THE EXPRESSION CIVIL CONSTRUCTION INCLUDES (A) THE CONSTRUCTION OR REPAIR OF ANY BUILDING BR IDGE DAM OR OTHER STRUCTURE OR OF ANY CANAL OR ROAD; (B) THE EXECUTION OF ANY WORKS CONTRACT.] THE FOLLOWING SECTION 44AD SHALL BE SUBSTITUTED FOR THE EXISTING SECTION 44AD BY THE FINANCE (NO. 2) ACT 2009 W.E.F. 1-4-2011 : SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS OF BUSINESS ON PRESUMPTIVE BASIS. 44AD. (1) NOTWITHSTANDING ANYTHING TO THE CONTRARY CONT AINED IN SECTIONS 28 TO 43C IN THE CASE OF AN ELIGIBLE ASSESSEE ENGAGED IN AN ELIGIBLE BUSINESS A SUM EQUAL TO EIGHT PER CENT OF THE TOTA L TURNOVER OR GROSS RECEIPTS OF THE ASSESSEE IN THE PREVIOUS YEAR ON AC COUNT OF SUCH BUSINESS OR AS THE CASE MAY BE A SUM HIGHER THAN THE AFORESAID SUM CLAIMED TO HAVE BEEN EARNED BY THE ELIGIBLE ASSESSE E SHALL BE DEEMED TO BE THE PROFITS AND GAINS OF SUCH BUSINESS CHARGE ABLE TO TAX UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSI ON. (2) ANY DEDUCTION ALLOWABLE UNDER THE PROVISIONS OF SECTIONS 30 TO 38 SHALL FOR THE PURPOSES OF SUB-SECTION (1) BE DEEMED TO HAVE BEEN ALREADY GIVEN FULL EFFECT TO AND NO FURTHER DEDUCTION UNDER THOSE SECTIONS SHALL BE ALLOWED : PROVIDED THAT WHERE THE ELIGIBLE ASSESSEE IS A FIRM THE SA LARY AND INTEREST PAID TO ITS PARTNERS SHALL BE DEDUCTED FROM THE INCOME COMP UTED UNDER SUB- SECTION (1) SUBJECT TO THE CONDITIONS AND LIMITS SP ECIFIED IN CLAUSE (B) OF SECTION 40 . 5 (3) THE WRITTEN DOWN VALUE OF ANY ASSET OF AN ELIGI BLE BUSINESS SHALL BE DEEMED TO HAVE BEEN CALCULATED AS IF THE ELIGIBLE ASSESSEE HA D CLAIMED AND HAD BEEN ACTUALLY ALLOWED THE DEDUCTION IN RESPECT OF T HE DEPRECIATION FOR EACH OF THE RELEVANT ASSESSMENT YEARS. (4) THE PROVISIONS OF CHAPTER XVII-C SHALL NOT APPL Y TO AN ELIGIBLE ASSESSEE IN SO FAR AS THEY RELATE TO THE ELIGIBLE BUSINESS. (5) NOTWITHSTANDING ANYTHING CONTAINED IN THE FOREG OING PROVISIONS OF THIS SECTION AN ELIGIBLE ASSESSEE WHO CLAIMS THAT HIS P ROFITS AND GAINS FROM THE ELIGIBLE BUSINESS ARE LOWER THAN THE PROFITS AN D GAINS SPECIFIED IN SUB-SECTION (1) AND WHOSE TOTAL INCOME EXCEEDS THE MAXIMUM AMOUNT WHICH IS NOT CHARGEABLE TO INCOME-TAX SHALL BE REQ UIRED TO KEEP AND MAINTAIN SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS AS REQUIRED UNDER SUB-SECTION (2) OF SECTION 44AA AND GET THEM AUDITED AND FURNISH A REPORT OF SUCH AUDIT AS REQUIRED UNDER SE CTION 44AB. EXPLANATION.FOR THE PURPOSES OF THIS SECTION (A) ELIGIBLE ASSESSEE MEANS (I) AN INDIVIDUAL HINDU UNDIVIDED FAMILY OR A PAR TNERSHIP FIRM WHO IS A RESIDENT BUT NOT A LIMITED LIABILITY PARTNERSHIP F IRM AS DEFINED UNDER CLAUSE (N) OF SUB-SECTION (1) OF SECTION 2 OF THE L IMITED LIABILITY PARTNERSHIP ACT 2008 (6 OF 2009); AND (II) WHO HAS NOT CLAIMED DEDUCTION UNDER ANY OF TH E SECTIONS 10A 10AA 10B 10BA OR DEDUCTION UNDER ANY PROVISIONS OF CHAP TER VIA UNDER THE HEADING C. - DEDUCTIONS IN RESPECT OF CERTAIN INCOMES IN THE RELEVANT ASSESSMENT YEAR; (B) ELIGIBLE BUSINESS MEANS (I) ANY BUSINESS EXCEPT THE BUSINESS OF PLYING HI RING OR LEASING GOODS CARRIAGES REFERRED TO IN SECTION 44AE; AND (II) WHOSE TOTAL TURNOVER OR GROSS RECEIPTS IN THE PREVIOUS YEAR DOES NOT EXCEED AN AMOUNT OF FORTY LAKH RUPEES. DURING HEARING THE LEARNED SENIOR DR CONTENDED THA T SECTION 44AE OF THE ACT IS APPLICABLE THEREFORE W E ARE REPRODUCING UNDERUNDER SECTION 44AE OF THE ACT ALSO :- SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS O F BUSINESS OF PLYING HIRING OR LEASING GOODS CARRIAGES. 44AE. (1) NOTWITHSTANDING ANYTHING TO THE CONTRARY CONT AINED IN SECTIONS 28 TO 43C IN THE CASE OF AN ASSESSEE WHO OWNS NOT MORE THA N TEN GOODS CARRIAGES 70 [AT ANY TIME DURING THE PREVIOUS YEAR] AND WHO IS ENGAGED IN THE BUSINESS OF PLYING HIRING OR LEA SING SUCH GOODS CARRIAGES THE INCOME OF SUCH BUSINESS CHARGEABLE T O TAX UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION SHALL BE DEEMED TO BE THE AGGREGATE OF THE PROFITS AND GAINS FROM ALL THE GOODS CARRIAGES OWNED BY HIM IN THE PREVIOUS YEAR COMPUTED IN ACCO RDANCE WITH THE PROVISIONS OF SUB-SECTION (2). 6 (2) FOR THE PURPOSES OF SUB-SECTION (1) THE PROFIT S AND GAINS FROM EACH GOODS CARRIAGE (I) BEING A HEAVY GOODS VEHICLE SHALL BE AN AMOU NT EQUAL TO 71 [THREE THOUSAND FIVE HUNDRED] RUPEES FOR EVERY MONTH OR PA RT OF A MONTH DURING WHICH THE HEAVY GOODS VEHICLE IS OWNED BY TH E ASSESSEE IN THE PREVIOUS YEAR OR AS THE CASE MAY BE AN AMOUNT HIG HER THAN THE AFORESAID AMOUNT AS DECLARED BY HIM IN HIS RETURN O F INCOME; (II) OTHER THAN A HEAVY GOODS VEHICLE SHALL BE AN AMOUNT EQUAL TO 72 [THREE THOUSAND ONE HUNDRED AND FIFTY] RUPEES FOR EVERY MO NTH OR PART OF A MONTH DURING WHICH THE GOODS CARRIAGE IS OWNED BY T HE ASSESSEE IN THE PREVIOUS YEAR OR AS THE CASE MAY BE AN AMOUNT HIG HER THAN THE AFORESAID AMOUNT AS DECLARED BY HIM IN HIS RETURN O F INCOME. THE FOLLOWING SUB-SECTION (2) SHALL BE SUBSTITUTED FOR THE EXISTING SUB-SECTION (2) OF SECTION 44AE BY THE FINANCE (NO. 2) ACT 2009 W.E.F. 1-4-2011 : (2) FOR THE PURPOSES OF SUB-SECTION (1) THE PROFIT S AND GAINS FROM EACH GOODS CARRIAGE (I) BEING A HEAVY GOODS VEHICLE SHALL BE AN AMOUN T EQUAL TO FIVE THOUSAND RUPEES FOR EVERY MONTH OR PART OF A MONTH DURING WH ICH THE HEAVY GOODS VEHICLE IS OWNED BY THE ASSESSEE IN THE PREVI OUS YEAR OR AN AMOUNT CLAIMED TO HAVE BEEN ACTUALLY EARNED FROM SU CH VEHICLE WHICHEVER IS HIGHER; (II) OTHER THAN A HEAVY GOODS VEHICLE SHALL BE AN AMOUNT EQUAL TO FOUR THOUSAND FIVE HUNDRED RUPEES FOR EVERY MONTH OR PAR T OF A MONTH DURING WHICH THE GOODS CARRIAGE IS OWNED BY THE ASS ESSEE IN THE PREVIOUS YEAR OR AN AMOUNT CLAIMED TO HAVE BEEN ACT UALLY EARNED FROM SUCH VEHICLE WHICHEVER IS HIGHER. (3) ANY DEDUCTION ALLOWABLE UNDER THE PROVISIONS OF SECTIONS 30 TO 38 SHALL FOR THE PURPOSES OF SUB-SECTION (1) BE DEEM ED TO HAVE BEEN ALREADY GIVEN FULL EFFECT TO AND NO FURTHER DEDUCTI ON UNDER THOSE SECTIONS SHALL BE ALLOWED : 73 [ PROVIDED THAT WHERE THE ASSESSEE IS A FIRM THE SALARY AND I NTEREST PAID TO ITS PARTNERS SHALL BE DEDUCTED FROM THE INC OME COMPUTED UNDER SUB-SECTION (1) SUBJECT TO THE CONDITIONS AND LIMIT S SPECIFIED IN CLAUSE (B) OF SECTION 40 .] (4) THE WRITTEN DOWN VALUE OF ANY ASSET USED FOR TH E PURPOSE OF THE BUSINESS REFERRED TO IN SUB-SECTION (1) SHALL BE DE EMED TO HAVE BEEN CALCULATED AS IF THE ASSESSEE HAD CLAIMED AND HAD B EEN ACTUALLY ALLOWED THE DEDUCTION IN RESPECT OF THE DEPRECIATIO N FOR EACH OF THE RELEVANT ASSESSMENT YEARS. (5) THE PROVISIONS OF SECTIONS 44AA AND 44AB SHALL NOT APPLY IN SO FAR AS THEY RELATE TO THE BUSINESS REFERRED TO IN SUB-S ECTION (1) AND IN COMPUTING THE MONETARY LIMITS UNDER THOSE SECTIONS THE GROSS RECEIPTS OR AS THE CASE MAY BE THE INCOME FROM THE SAID BU SINESS SHALL BE EXCLUDED. 74 [(6) NOTHING CONTAINED IN THE FOREGOING PROVISIONS OF THIS SECTION SHALL APPLY WHERE THE ASSESSEE CLAIMS AND PRODUCES EVIDENCE TO PROVE THAT THE PROFITS AND GAINS FROM THE AFORESAID BUSIN ESS DURING THE 7 PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR COMME NCING ON THE 1ST DAY OF APRIL 1997 OR ANY EARLIER ASSESSMENT YEAR ARE LOWER THAN THE PROFITS AND GAINS SPECIFIED IN SUB-SECTIONS (1) AND (2) AND THEREUPON THE ASSESSING OFFICER SHALL PROCEED TO MAKE AN ASSE SSMENT OF THE TOTAL INCOME OR LOSS OF THE ASSESSEE AND DETERMINE THE SU M PAYABLE BY THE ASSESSEE ON THE BASIS OF ASSESSMENT MADE UNDER SUB- SECTION (3) OF SECTION 143 .] 75 [(7) NOTWITHSTANDING ANYTHING CONTAINED IN THE FORE GOING PROVISIONS OF THIS SECTION AN ASSESSEE MAY CLAIM LOWER PROFIT S AND GAINS THAN THE PROFITS AND GAINS SPECIFIED IN SUB-SECTIONS (1) AND (2) IF HE KEEPS AND MAINTAINS SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS AS REQUIRED UNDER SUB-SECTION (2) OF SECTION 44AA AND GETS HIS ACCOUNTS AUDITED AND FURNISHES A REPORT OF SUCH AUDIT AS REQUIRED UN DER SECTION 44AB .] EXPLANATION.FOR THE PURPOSES OF THIS SECTION (A) THE EXPRESSIONS GOODS CARRIAGE 76 AND HEAVY GOODS VEHICLE 76 SHALL HAVE THE MEANINGS RESPECTIVELY ASSIGNED TO THEM IN SECTION 2 OF THE MOTOR VEHICLES ACT 1988 (59 OF 1988); (B) AN ASSESSEE WHO IS IN POSSESSION OF A GOODS C ARRIAGE WHETHER TAKEN ON HIRE PURCHASE OR ON INSTALMENTS AND FOR WHICH THE W HOLE OR PART OF THE AMOUNT PAYABLE IS STILL DUE SHALL BE DEEMED TO BE THE OWNER OF SUCH GOODS CARRIAGE.] IF THE AFORESAID PROVISIONS ARE ANALYSED SECTION 44AD OF THE ACT SPEAKS ABOUT WHERE AN ASSESSEE IS ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION OR SU PPLY OF LABOUR FOR CIVIL CONSTRUCTION A SUM EQUAL TO 8% OF THE GROSS RECEIPTS PAID OR PAYABLE TO THE ASSESSEE IN THE PREVIOUS YEAR SHALL BE DEEMED TO BE PROFITS AND GAINS OF SUCH BUSINESS SUBJECT TO THE AMOUNT O F RS.40 LACS WHEREAS SECTION 44AE OF THE ACT IS APPLICABLE WHERE THE ASSESSEE OWNS NOT MORE THAN 10 GOODS CARRIAGE AND IS ENGAGED IN THE BUSINESS OF PLYING HIRING OR LEASING SUCH GOODS CARRIAGES. IN THE PRESENT APPEAL THE VEHICLES RUN BY THE RESPECTIVE ASSESSEES ARE NOT THE GOODS CARRIAGES THEREFORE SECTION 44AE IS NOT APPLICABLE. IF THE ASSESSMENT ORDER IS ANALYSED THE LEARNED ASSESSING OFFICER EV EN CALLED FOR TENTATIVE INCOME AND EXPENDITURE ACCOUN T VIDE HIS LETTER DATED 3 RD NOVEMBER 1999 BEFORE COMPLETING THE ASSESSMENT. IT IS ALSO AN UNDISPUTE D FACT THAT THE LEARNED ASSESSING OFFICER MADE AD HOC DISALLOWANCE OF EXPENSES AT THE RATE OF 20% WHICH RESULTED INTO NET PROFIT RATE OF 19.3% ON THE GROSS RECEIPTS (AFTER DEPRECIATION). THE FINANCE (NO. 2 ) ACT OF 2009 EXTENDS THE SCHEME OF TAXATION OF INCOME ON 8 PRESUMPTIVE BASIS TO ALL SMALL BUSINESSMEN (OTHER T HAN TRANSPORT) CONSEQUENTLY AMENDMENT WAS CARRIED OUT AND SECTION 44AD WAS SUBSTITUTED TO ENLARGE THE AMB IT OF PRESUMPTIVE TAXATION. HOWEVER THE ASSESSING OFFICER WHILE MAKING AN ASSESSMENT TO THE BEST OF HIS JUDGMENT IN THE ABSENCE OF BOOKS OF ACCOUNTS IS A LSO BOUND TO FOLLOW STRICT JUDICIAL PRINCIPLES AND MUST BE GUIDED BY RULES OF JUSTICE EQUITY AND GOOD CONSCIE NCE. THEREFORE IT IS INCUMBENT UPON THE ASSESSING OFFIC ER TO RESORT TO ESTIMATE THE PROFIT IN A JUST AND REAS ONABLE MANNER. ADMITTEDLY IN THE ABSENCE OF MAINTENANCE O F BOOKS OF ACCOUNTS THE ASSESSING OFFICER IS ALSO HAV ING NO OTHER OPTION BUT TO ESTIMATE. THEREFORE TO MEE T THE ENDS OF JUSTICE AND KEEPING IN VIEW NATURE OF BUSIN ESS IN WHICH OVERHEAD EXPENSES ACCIDENTS ACCIDENT CLAIMS SALARY TO STAFF FUEL EXPENSES MAINTENANCE OF VEHICLES ETC. ARE NECESSARILY TO BE INCURRED THER EFORE WE THINK IT APPROPRIATE TO RESTRICT THE DISALLOWANC E AT 10%. IN PLACE OF 20% ESTIMATED BY THE ASSESSING OFFICER WHICH WAS CONFIRMED IN APPEAL BY THE LEARNE D COMMISSIONER OF INCOME TAX (APPEALS) THEREFORE TH IS GROUND OF THE ASSESSEES IS PARTLY A LLOWED. IF THE TOTALITY OF FACTS AND THE CONCLUSION OF THE TRIBUNAL MENTIONED HEREINABOVE ARE ANALYSED AND KEPT IN JUXTAPOSITION WITH THE CLAIM OF THE ASSESSEE WE FIND NO INFIRMITY IN THE SAME AND ALSO NO JUSTIFICATION IN THE CONTENTION RAISED BY THE ASSESSEES IN MISCELLANEOUS APPLICATIONS U/S 254(2) OF THE ACT. EVEN OTHERWISE THE TRIBUNAL HAS LIMITED POWERS TO REVIEW ITS ORDER. THE POWERS OF VIEW MUST BE CONFERRED BY THE STATUTE . REVIEW OF AN ORDER MEANS REEXAMINATION OR TO GIVE A SECOND VIEW OF THE MATTER FOR THE PURPOSES OF ALTERATION OR REVERSAL OF THE VIEW ALRE ADY TAKEN AFTER CHANGING THE EARLIER OPINION OR VIEW. THE ORDER PASSED BY TH E TRIBUNAL U/S 254(1) IS 9 THE EFFECTIVE ORDER SO FAR AS THE APPEAL IS CONCERN ED. ANY ORDER PASSED U/S 254(2) EITHER ALLOWING AMENDMENT OR REFUSING TO AME ND GETS MERGED WITH THE ORIGINAL ORDER PASSED. THE ORDER AS AMENDED OR REMAINING UNAMENDED IS THE EFFECTIVE ORDER FOR ALL PRACTICABLE PURPOSES. T HAT IS THE FINAL ORDER OF THE APPEAL. RECALLING OF ORDER IS NOT PERMISSIBLE U/S 2 54(2) AS RECALLING AUTOMATICALLY NECESSITATES REHEARING AND READJUDICA TION OF THE APPEAL. OUR VIEW IS SUPPORTED BY THE DECISION IN CIT VS. B.P. A GRAWAL (90 TAXMAN 283) (CAL) KARAN & CO. (253 ITR 131) (DEL) NIRANJAN & CO. LTD. VS. ITAT (122 ITR 519) (CAL) CIT VS. ITAT (196 ITR 640) (ORI) AND CI T VS. ITAT (155 TAXMAN 378) (DEL). IN VIEW OF THESE FACTS AND THE JUDICIAL PRONOUNCEMENTS NO CASE IS MADE OUT BY THE ASSESSEES THROUGH THEIR MISCELLA NEOUS PETITIONS THEREFORE SAME ARE DISMISSED. FINALLY THE MISCELLANEOUS PETITIONS OF THE ASSESS EES ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH SIDES AT THE CONCLUSION OF THE HEARING ON THE MISCELLANEOUS PETITION ON 25.3.2011. (R.C. SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 25.3.2011 !VYAS! COPY TO APPELLANT RESPONDENT CIT CIT(A) DR GU ARD FILE