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2016 (7) TMI 1092 - PUNJAB & HARYANA HIGH COURT

2016 (7) TMI 1092 - PUNJAB & HARYANA HIGH COURT - TMI - Enhancement of the Net Profit Rate - Held that:- Once the Revenue, being bound by the circular of the C.B.D.T., New Delhi, has withdrawn its appeal seeking enhancement of the Net Profit Rate, inter se the same parties, it cannot be allowed to reagitate the issue. However, such observation on our part would not preclude the Revenue from moving any application for revival of the aforereferred appeal since the liberty for the same was granted .....

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he Income Tax Appellate Tribunal, Chandigarh Bench A', Chandigarh (hereinafter referred to as - the Tribunal). The subject matter of the present appeal pertains to the assessment year 2008-09 and through the same, the assessee seeks to raise the following substantial questions of law :- 1. Whether the ITAT was justified in confirming addition @ 6% on estimation basis without considering the past record and arbitrary addition to declared income by the authorities below ? 2. Whether the order .....

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for scrutiny and in the proceedings which ensued, the Assessing Officer found that the assessee had not produced before him the complete original vouchers and muster-rolls. It was further noted by the Assessing Officer that the copy of attendance cards, pertaining to the labour engaged by the assessee, which had been produced before him, were without names and addresses. In view of afore-noticed facts, after rejecting the books of accounts, the Assessing Officer assessed the assessee to tax afte .....

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red to as - the Commissioner), before whom the assessee submitted that he had produced on record original purchase vouchers, books of accounts, attendance cards with names of the labourers with their complete addresses, complete details of sundry creditors and the Net Profit Rate applied in the preceding years. On such basis, it was prayed that Net Profit Rate @ 2.5% be applied in his case. However, the Commissioner dismissed the appeal, which gave a cause to the assessee to further take the mat .....

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sh adjudication or that the appeal of the assessee be allowed by the Tribunal itself by reducing the Net Profit Rate to 2.5%. The Tribunal, while acknowledging that 83-90% of the purchase vouchers were available on record, chose not to remand the matter back for fresh adjudication on the ground that the remaining 10-17% vouchers were self made and thus, not verifiable. It was further held that the labour attendance cards did not carry the addresses of the labourers. Still further, while relying .....

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plete original vouchers, muster-rolls and copy of attendance cards containing the names and addresses of the labourers had not been produced before him. After ordering such rejection, Net Profit Rate of 12% was ordered to be applied. The record reveals that 83-90% of the purchase vouchers of various materials were produced by the assessee. Through an application dated 10.12.2010 (Annexure A-4), the assessee claims to have placed on the record of the authorities below the attendance cards with na .....

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ent year 2003-04, the applied Net Profit Rate was 3%, for 2005-06 the same was 1.08% and for the preceding assessment year 2007-08, the same was 2.29%. Without spelling out any reasons for the same, the Tribunal ignored the above rates and chose to apply the Net Profit Rate of 6% by basing the same on the applied Net Profit Rate for only one of the earlier assessment years. In view of what has been noticed above, in our opinion, the matter required deeper scrutiny at the hands of the Tribunal, w .....

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h regard to application of 6% Net Profit Rate as according to the Revenue, the same should have been 12% as had been applied by the Assessing Officer. On 08.02.2016, the appeal was ordered to be dismissed as withdrawn through the following order :- Learned counsel for the appellant revenue states that since the tax effect involved is ₹ 16,66,247/- he has instructions to withdraw the present appeal in view of the circular No. 21/2015, dated 10.12.2015 issued by the C.B.D.T., New Delhi. Howe .....

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