IN INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.No.5778/Del./2018 Assessment Year 2010-2011 Shri Pal Yadav, Income Tax Officer, CS-66, Malibu Towne, Ward-4(2), Sohna Road, Sector-47, vs., Gurgaon. Gurgaon. Haryana. PAN AFZPP8771M (Appellant) (Respondent) For Assessee : Shri Sushil Kumar Tandon, FCA For Revenue : Shri S.L. Anuragi, Sr. D.R. Date of Hearing : 22.08.2019 Date of Pronouncement : 02.09.2019 ORDER This appeal by assessee has been directed against order of Ld. CIT(A)-1, Gurgaon, Dated 29th June 2018, for assessment year 2010-11 2. Briefly facts of case are that on basis of information available with Department that assessee has received contractual payments amounting to Rs.1,00,02,953/- during assessment year under appeal and on perusal of ITD database, it was found that 2 ITA.No.5778/Del./2018 Shri Pal Yadav, Gurgaon. assessee has not filed return of income for assessment year under appeal. Notice was issued to assessee, but, no reply was filed in response to NMS notice. assessing officer, therefore, reopened assessment on ground that Income from contractual payments chargeable to tax has escaped assessment . During year under consideration, assessee is engaged in business of running stage carriages as proprietor under name and style of Sagar Tour and Travel . During course of assessment proceedings, assessee has submitted that he has not received any amount from M/s. Ruptech Education India and M/s. SRF Foundation. assessee has shown total receipts of Rs.58,43,303/-. assessee was asked to furnish ledger of all expenses debited under profit and loss account and to explain as to why penalty should not be levied for non- audit as required under section 44AB of Income Tax Act, 1961. assessee was asked to furnish copies of all ledger of expenses and bills/vouchers. It was also clarified that in case of non- furnishing of books of account with bills / vouchers, 3 ITA.No.5778/Del./2018 Shri Pal Yadav, Gurgaon. assessment will be framed at 12% of total receipts declared by assessee. In absence of production of books of account, bills/vouchers, assessing officer assessed income by applying 12% of Rs.58,43,303/- and computed income of Rs.7,01,196/-. assessing officer also initiated penalty proceedings for non-audit of books of account of assessee. 3. assessee challenged addition before Ld. CIT(A). written submissions of assessee are reproduced in appellate order in which assessee explained that assessing officer has very hastily passed assessment order without affording proper opportunity of being heard to assessee. assessee has brought with him all ledger accounts of expenses, bills / vouchers, but, at that time assessing officer was not present in Office. It was submitted that application of 12% is very high. Ld. CIT(A), however, noted that assessee failed to produce books of account, bills and vouchers before assessing officer and that contention of assessee that he had gone to assessing officer s office with books of 4 ITA.No.5778/Del./2018 Shri Pal Yadav, Gurgaon. account and bills/vouchers, but, assessing officer was not present in Office is factually incorrect because case was discussed with assessing officer on that date. Ld. CIT(A) in absence of production of books of account, bills and vouchers, confirmed addition and dismissed appeal of assessee. 4. Learned Counsel for Assessee reiterated submissions made before authorities below. He has referred to PB-71 which is order sheet of assessing officer and submitted that assessing officer has not given sufficient time to produce books of account and other details. He has submitted that assessee produced all bills and vouchers before assessing officer which have not been examined. assessee in replies before assessing officer, has furnished copies of bills of expenses etc., He has submitted that Ld. CIT(A) never called for books of account, therefore, same were not produced before him. He has submitted that addition is excessive in nature. 5 ITA.No.5778/Del./2018 Shri Pal Yadav, Gurgaon. 5. On other hand, Learned Departmental Representative relied upon orders of authorities below. 6. I have considered rival submissions. Ld. CIT(A) has specifically noted in his findings that assessee has failed to produce books of account, bills and vouchers before assessing officer. Learned Counsel for Assessee referred to order sheet of assessing officer which also supports findings of authorities below. assessing officer in order sheet has specifically noted that in case books of account will not be produced, income will be assessed by applying 12% against receipts declared. Learned Counsel for Assessee referred to replies filed before authorities below, but, it no where proves that assessee produced books of account before Ld. A.O. or CIT(A). Since it is specifically mentioned in order sheet that incase assessee would not produce books of account, profit rate of 12% would be applied, Even if contention of assessee may be accepted that no proper opportunity has been given to assessee to produce books of account 6 ITA.No.5778/Del./2018 Shri Pal Yadav, Gurgaon. before assessing officer, assessee could have produce same before Ld. CIT(A) who has co-terminus powers to that of assessing officer. However, Learned Counsel for Assessee could not satisfy if books of account were produced before Ld. CIT(A). He has merely contended that Ld. CIT(A) never asked for production of books of account which would not absolve assessee from producing books of account before Ld. CIT(A). Further, during course of arguments, Learned Counsel for Assessee did not produce books of account to satisfaction of Tribunal. It, therefore, stands proved that assessee failed to produce books of account before any of authorities below and whatever claim was made, has not been substantiated through any evidence or material on record. Therefore, authorities below were justified in estimating income of assessee by applying higher profit rate. However, considering smallness of total turnover of assessee and nature of business of assessee, it would be reasonable and proper if income be assessed by applying profit rate of 8% as against 12% applied by 7 ITA.No.5778/Del./2018 Shri Pal Yadav, Gurgaon. authorities below. In view of above discussion, I confirm finding of fact recorded by authorities below to estimate income. However, I direct assessing officer to modify application of profit rate by applying profit rate of 8% against total receipts of Rs.58,43,303/- and compute income of assessee accordingly instead of 12%. 7. In result, appeal of Assessee partly allowed. Order pronounced in open Court. Sd/- (BHAVNESH SAINI) JUDICIAL MEMBER Delhi, Dated 2nd September, 2019 VBP/- Copy to 1. appellant 2. respondent 3. CIT(A) concerned 4. CIT concerned 5. D.R. ITAT SMC Bench 6. Guard File //By Order// Asst. Registrar : ITAT : Delhi Benches : Delhi. 8 ITA.No.5778/Del./2018 Shri Pal Yadav, Gurgaon. Date of dictation 22.08.2019 Date on which typed draft order is placed before 30.08.2019 dictation Member Date on which approval draft comes to Sr. PS 02.09.2019 Date on which fair order is placed before 02.09.2019 Dictation member for pronouncement Date on which fair order comes back to Sr. P.S. 02.09.2019 Date on which final order is uploaded on 02.09.2019 website of ITAT Date on which file goes to Bench Clerk 02.09.2019 Date on which file goes to Head Clerk date on which file goes to Assistant Registrar for signature on order Date of dispatch of Order. Pal Yadav v. Income-tax Officer, Ward-4(2), Gurgaon