9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (6) TMI 929 - AT - Income TaxReopening of assessment - addition to income applying G.P rate of 14.97% on the suppressed receipts - whether GP/NP cannot be applied to such part of turnover represented by excise duty.? - CIT(A) deleted addition - A.O. also made addition on account of provisions of Section 40A(2b) - Held that - From the findings of Ld. CIT(A) we observe that Ld. CIT(A) has passed a well speaking, elaborate and reasoned order wherein he has made clear cut findings and has rightly held that excise duty forming part of turnover as declared before trade tax authorities, cannot be subjected to gross profit. Similarly, the other addition made by A.O. u/s 40A(2)(b) has been rightly deleted as in original assessment proceedings also, the A.O. had made similar additions and Ld. CIT(A) had already deleted the same. Therefore, we do not find any infirmity in the order of Ld. CIT(A). - Decided in favour of assessee.
Issues:
- Whether the CIT(A) erred in law in deleting the addition of Rs. 16,45,362/- while allowing the assessee's appeal against the addition made by the A.O. in the reassessment proceedings. - Whether the CIT(A) erred in law in deleting the addition without giving explicit findings while accepting the assessee's version. - Whether the order of the CIT(A) should be set aside and that of the A.O. restored. Analysis: 1. The Revenue filed an appeal against the CIT(A)'s order for Assessment Year 2006-07, which was mistakenly mentioned as 2008-09 in the appellate order. The grounds of appeal by Revenue focused on the deletion of an addition of Rs. 16,45,362/- by the CIT(A) based on the application of G.P. rate on suppressed receipts and the disallowance under Section 40A(2b). 2. Despite the absence of the assessee, the Tribunal proceeded with the case based on the material on record and submissions by the Departmental Representative (D.R.). The D.R. acknowledged that the turnover reflected in the audited P&L account excluded excise duty, leading to the conclusion that GP/NP cannot be applied to that part of the turnover. 3. The Tribunal noted that the A.O. found the assessee had suppressed sales by Rs. 1,00,40,147/- and applied a G.P. rate on such sales, along with an additional disallowance under Section 40A(2b). The CIT(A) allowed relief to the assessee after considering all facts and circumstances, including the original assessment, reassessment proceedings, and objections raised by the assessee. 4. The CIT(A) extensively analyzed the case, highlighting discrepancies in the A.O.'s approach, failure to address objections, and violation of natural justice principles. The CIT(A) concluded that the reassessment proceedings were initiated without due consideration of the assessee's explanations and directed the deletion of the additions made by the A.O. 5. The Tribunal upheld the CIT(A)'s order, emphasizing that excise duty forming part of turnover could not be subjected to gross profit calculation and that the disallowance under Section 40A(2b) was unjustified, especially considering the previous deletion of similar additions by the CIT(A) in original assessment proceedings. 6. Consequently, the Tribunal dismissed the Revenue's appeal, affirming the well-reasoned and detailed order passed by the CIT(A) in favor of the assessee. 7. The judgment was pronounced on 31.3.2015 by the Tribunal, affirming the dismissal of the Revenue's appeal against the CIT(A)'s order.
|
