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Rajhans Metals Private Limited Versus The Assistant Commissioner of Income tax 9 (3) , Mumbai

2017 (9) TMI 975 - BOMBAY HIGH COURT

Estimation of turnover - as per Tribunal First Appellate Authority while restricting the gross profit rate at the rate of 9% taken into consideration the overall facts and circumstances of the case - fair and reasonable opportunity availability - Held that:- No error of law apparent on the face of the record nor perversity in the order of the Tribunal. The reasoning of the Tribunal's order is not vitiated by the alleged non-consideration of the grievance of the appellant/assessee that fair and r .....

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. On the other hand, what we find is that such reappreciation and reappraisal is impermissible in law. More so, when there is no perversity in the findings of the Tribunal. Its view is imminently possible. We do not find any merit in the appeal. It is dismissed. - Income Tax Appeal No. 449 of 2015 - Dated:- 12-9-2017 - S. C. Dharmadhikari And Prakash D. Naik, JJ. Mr. Bharat Janarthan with Mr. Atul K. Jasani for the Appellant Mr. Arvind Pinto for the Respondent ORDER P.C: 1. This appeal of the as .....

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that question Nos.1 to 4 and the overall perversity in the order of the Tribunal would enable this Court to admit this appeal as these questions are substantial questions of law. 4. In that regard, it is urged that there was no reasonable opportunity given to the appellant/assessee so as establish and prove its version. The version is arising from the peculiarity of its business. During the previous year relevant to the Assessment Year 2007-08, the appellant achieved a turnover of ₹ 131 cr .....

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ethod of accounting adopted. During the Assessment Year 200708, the Assessing Officer sought various details for the purposes of completion of the assessment. The appellant attended the office of the Assessing Officer on the stipulated dates and produced all the records. The datewise summary is placed as Annexure E to the present memo of appeal. 6. Then, there was another notice issued on 1-12-2009 by the Assessing Officer, copy of which is at AnnexureF and in response to which as well, the appe .....

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verify the position from the books by visiting Jamnagar. 7. Yet, the Assessing Officer passed an order on 16-12-2009, only five days after the date of the letter dated 11-12-2009 wherein he rejected the books of account. He estimated the gross profit of the appellant at 9.78% based on the average of earlier two years as against 7.43% gross profit as per the audited accounts of the appellant. Thus, detail submissions by the assessee were not taken into consideration. In any event, had complete o .....

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ount by the Assessing Officer, nothing other than what the Assessing Officer did transpired and the Commissioner further reduced the gross profit at 9% as opposed to 9.78% taken by the Assessing Officer. 10. Before the Tribunal all these materials were produced and it was urged that as in other two disallowances/additions, even on this point if the matter is sent back, the ends of justice would be served. However, even such a reasonable stand of the assessee was rejected by the Tribunal on flims .....

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Act, 1961 were taken up and notice under Section 142(1) was issued on 1072009 requiring the assessee to file certain details. The Tribunal has from the record culled out the opportunities granted to the assessee to file those details. Hearing was fixed for this purpose on 21-8-2009, then on 3-9-2009, 11-9-2009, 22-9-2009, 6-10-2009, 15-10-2009, 23-10-2009, 27-10-2009 and 29-10-2009 respectively. The numerous opportunities resulted in the assessee failing to file the details. It is thereafter on .....

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terials as required have not been produced, the satisfaction about completeness or correctness of the account cannot be recorded. It is in these circumstances that he resorted to subsection (3) of Section 145 of the Act. He rejected the books of account and estimated the gross profit at the rate of 9.78% of sales as against 7.43% of sales declared by the assessee. 13. The First Appellate Authority found that the Assessing Officer compared the gross profit with those declared in earlier years. Th .....

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res. It is in these circumstances and deriving the figures from the record produced by the assessee itself that the restriction of the addition was brought down from ₹ 3,43,51,585/to ₹ 2,06,77,484/. This exercise before the First Appellate Authority resulted in relief of ₹ 1,36,74,101/. Even this was not to the satisfaction of the parties. 14. The Revenue brought an appeal and in ground No.2 stated that it is agitating the reduction in the estimated gross profit rate by the Fir .....

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