CWP No.27253 of 2016 1 IN HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP No.27253 of 2016 Date of decision: 15.05.2017 Shri Sanjay Kundu Petitioner Vs. Commissioner of Income Tax, Rohtak ..Respondent CORAM: HON BLE MR. JUSTICE AJAY KUMAR MITTAL HON BLE MR. JUSTICE HARINDER SINGH SIDHU Present: Mr. B.M. Monga, Advocate with Mr. Rohit Kaura, Advocate for petitioner. Ajay Kumar Mittal,J. 1. Prayer in this petition filed under Article 226 of Constitution of India is for quashing impugned order dated 30.03.2015 (Annexure P-9) passed by Commissioner of Income Tax, Rohtak, (CIT) under Section 264 of Income Tax Act, 1961 (in short Act ), rejecting petition filed by petitioner under Section 264 of Act and thereby confirming assessment order dated 15.03.2013 (Annexure P-4). Direction has also been sought to CIT, Rohtak, for reconsideration of petition filed by petitioner. 2. few facts relevant for decision of controversy involved as narrated in petition may be noticed. petitioner- assessee is individual based at Rohtak. He is engaged in business 1 of 5 ::: Downloaded on - 04-07-2017 11:18:20 ::: CWP No.27253 of 2016 2 of Civil Contractor and is providing services mainly to Government sector. He filed return of income tax for assessment year 2010-11 on 25.05.2010, declaring income at ` 1,74,500/-. return was processed under Section 143(1) of Act on 15.03.2011. On 31.03.2012, petitioner revised return declaring income at ` 4,84,627/-. return of petitioner was selected for scrutiny on 10.09.2012 and notice under Section 143(2) of Act was issued. petitioner appeared through his counsel. He was directed to supply books of account alongwith relevant vouchers. petitioner submitted audited balance sheet and ledger accounts. Assessing Officer directed petitioner to produce complete bills/vouchers of expenses and also to furnish addresses to whom payment of these expenses had been made. Assessing Officer vide assessment order dated 15.03.2013 (Annexure P-4) rejected audited balance sheet and ledgers submitted by petitioner and made assessment under Section 145(3) of Act, applying net profit rate of 12% at ` 62,07,890/- against returned income of `1,74,500/-. Assessing Officer imposed penalty of ` 25,000/- under Section 271A of Act on ground that petitioner was not maintaining complete books of account, bills and vouchers. Further, penalty of ` 1,00,000/- under Section 271B of Act was imposed upon petitioner on ground that he had not filed audited accounts though audited balance sheet was provided to Assessing Officer and same was rejected by him. Assessing Officer also imposed penalty of ` 17,66,904/- under Section 271B of Act. Aggrieved by orders, petitioner filed petition under Section 264 of Act before CIT inter alia on ground that Assessing Officer, passed assessment order due to extraneous 2 of 5 ::: Downloaded on - 04-07-2017 11:18:21 ::: CWP No.27253 of 2016 3 considerations; record of case was not perused and that enquiry may be made in case as it was case of no-voice before Assessing Officer. Vide order dated 30.03.2015 (Annexure P-9), Commissioner of Income Tax rejected petition filed by petitioner under Section 264 of Act. According to petitioner, he had provided all relevant documents to his counsel, but unfortunately he could not concentrate on his legal work because of prolonged illness of his only son who later on died on 14.01.2015. Further, petitioner was pre-occupied in treatment of his cousin brother-in-law residing with him at Rohtak and getting treatment of cancer at PGIMS, Rohtak, who also died on 20.04.2016. Thus, counsel of petitioner could not act diligently leading to adverse assessment order and revisional order. Hence, instant petition by petitioner before this Court. 3. We have heard learned counsel for petitioner. 4. Admittedly, assessee filed original income tax return on 25.05.2010 declaring income of ` 1,74,500/- which was processed under Section 143(1) of Act. He filed revised return on 31.03.2012 declaring income of `4,84,627/- under head business and profession. During year under consideration assessee had shown gross receipts from contract at ` 5,17,32,000/- and declared net profit of ` 4,85,000/-. case was selected for scrutiny. Notice under Section 143(2) of Act was issued. No one on behalf of petitioner attended proceedings. No reply was filed. Thereafter, various opportunities were provided from 05.11.2012 to 15.01.2013 but assessee failed to produce books of account and relevant vouchers. On perusal of assessment order and order passed by 3 of 5 ::: Downloaded on - 04-07-2017 11:18:21 ::: CWP No.27253 of 2016 4 (CIT) under Section 264 of Act, we find that more than sufficient opportunity was provided to assessee to explain his case of furnishing books of account and other relevant material. assessee failed to avail opportunity provided by Assessing Officer on several occasions. Even during those instances where authorized representative of assessee appeared, complete details were not filed. Accordingly, profit rate of 12% to gross receipts of assessee was held to be quite reasonable on basis of material available before Assessing Officer. Thus, CIT finding no errer in order passed by Assessing Officer, rightly concurred with view taken by Assessing Officer and rejected petition filed by petitioner under Section 264 of Act. 5. Even before this Court, petitioner-assessee was provided opportunity to demonstrate that profit rate of 12% adopted by Assessing Officer was higher and unreasonable. assessee had filed certificate of gross profit rate and net profit rate for Assessment years 2010-11 to 2014-2015 (Annexure P.12) which reads thus:- CA Arvind Krishan Associates Chartered Accountants Certificate It is hereby certified that financial of M/s Sanjay Kundu Contractor r/o V.P.O. Bhali Anandpur, Distt Rohtak are as under:- Financial Turnover G.P. (Rs.) G.P. N.P.(Rs.) N.P. year (Rs.) % % 2009-10 5,17,32,437.00 12,49,371.87 02.42 4,84,626.87 00.94 2010-11 2,23,77,429.00 9,86,376.00 04.41 3,82,000.00 01.71 4 of 5 ::: Downloaded on - 04-07-2017 11:18:21 ::: CWP No.27253 of 2016 5 2011-12 38,30,983.00 8,95,415.00 23.37 3,10,474.00 08.10 2012-13 6,61,66,279.00 39,82,326.00 06.02 8,91,650 01.35 2013-14 1,76,36,529.00 20,79,827.85 11.79 5,49,504.00 03.12 For Arvind Krishan Associates Chartered Accountants Stamp and Sign (M.No. 90184) (Prop.) Date:- 09.03.2017 Place:- Rohtak Office Near Soham Mandir, Green Road, Rohtak-124001 Ph: (O) 01262-250409 email:arvindjaintax@gmail.com perusal of aforesaid Chart shows that there had been lot of variation in profit rate of assessee during these years and therefore, in absence of production of books of account by assessee, no benefit can be derived by him by claiming profit rate as applicable then. Moreover, order passed by (CIT) is dated 30.03.2015. present petition has been filed after one year and eight months. Learned counsel for petitioner has not been able to produce any material on record to substantiate his claim made in petition. Consequently, finding no merit in petition, same is hereby dismissed. (Ajay Kumar Mittal) Judge May 15, 2017 (Harinder Singh Sidhu) gs Judge Whether speaking/reasoned Yes Whether reportable Yes 5 of 5 ::: Downloaded on - 04-07-2017 11:18:21 ::: Sanjay Kundu v. Commissioner of Income-tax, Rohtak