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M/s. Beardsell Eastern (P) Ltd. Vs. I.T.O Ward 5(3), Kolkata
September, 10th 2014
                      , Û ""B"" 
         IN THE INCOME TAX APPELLATE TRIBUNAL, "B" BENCH: KOLKATA
          (¢) ^  , Û   ^   ,  
        Before Hon'ble Sri Mahavir Singh, , JM & Hon'ble Sri Shamim Yahya, AM
                  É / ITA No. 1581/Kol/2011 A.Y 2005-06
     M/s. Beardsell Eastern (P) Ltd.     -- I.T.O Ward 5(3), Kolkata
     PAN: AACCB1980F
                                        -Versus-
           (/APPELLANT )                     .   (×/RESPONDENT)

     For the Appellant:                       ^/Shri            Subash Agarwal, Advocate
     For the Respondent :
                                              ^/Shri            Ravi Jain, ld. CIT/Sr.DR
                       /Date of Hearing: 04-09-2014
                     /Date of Pronouncement: 8/9/-2014
                                   /ORDER
 ^   ,  
 Shri Shamim Yahya, AM

        This appeal filed by the assessee is directed against the order of the Ld. CIT(A)
dated 05-09-2011 pertaining to assessment year 2005-06.

2.      The grounds of appeal raised by the assessee read as under:-

        1.     For that the order passed by the ld. CIT(A) as also the ld.AO U/s
        144 is arbitrary, unlawful, vindictive, excessive and bad in law.

        2.     For that the ld.CIT(A) as also the ld.AO were wrong in rejecting the
        books of accounts on the grounds of petty difference in some accounts and
        estimation of WIP which were duly explained and supported by
        documentary evidences at the time of Appellate and Remand proceedings.

        3.     For that the ld.CIT(A) was wrong in upholding the application of
        provision of Sec 44AD & 44AF of the I.T Act by the ld.AO as the gross
        receipts of the assessee was 152.75 lakhs. The above provisions are
        applicable only to assessee whose gross receipts are below 4 lakhs.

        4.     For that the ld.CIT(A) as well as the ld.AO has erred by not
        allowing depreciation as per provisions of Income Tax act after calculating

                                    ITA No.1581/Kol/11-B-AM M/s. Beardsell Eastern P.Ltd Vs. ITO, W 5(3), Kol.
                                                                                                                 1
       profits of the assessee as per gross profit rates as specified in Sec. 44AD &
       44AF of Income Tax Act.
5. For that the ld.CIT(A) as well as the ld.AO were wrong in disallowing the expenditure for non-deduction of TDS when he has determined the income applying the provisions of section 44AD & 44AF of Income Tax Act. 6. For that the ld.AO was wrong in initiating the proceedings U/s. 271(1)( c) as the assessment made by the ld.AO were an estimated basis created out of his assumptions and for which no penal action can be initiated. 3. In this case assessment was framed u/s. 144 of the I.T Act 1961. AO noted that there were various discrepancies found in the assessee's books of account. These differences are related to the followings:- a. Contractual receipt from M/s. Volatas Ltd. b. Contractual receipts from M/s. Gangarampur Cold Storage, and c. Contractual receipts from Burdwan Lamps. 3.1 The difference is also in income as shown in the account and income as per TDS certificate. Furthermore, the assessee company did not file any valuation of stock, stock register and valuation of W.I.P [Work in Progress] etc. The AO further noted that the assessee has also failed to substantiate with proper accounts about stores consumed. In this regard a show cause notice was issued to the assessee mentioning why the books of account should not be rejected. However, the assessee did not file any explanation despite several reminders sent by the AO. In these circumstances the AO proceeded to make assessment u/s. 144 of the I.T Act. The AO made the assessment at Rs.19,57,270/- u/s. 144 of the I.T Act 1961 . 4. Against the above, the assessee appealed file before the ld.CIT(A) 5. Against the action of the AO the ld.CIT(A) inter-alia has held as under:- ITA No.1581/Kol/11-B-AM M/s. Beardsell Eastern P.Ltd Vs. ITO, W 5(3), Kol. 2 Page 6 para 8. I have carefully considered the submissions of the assessee as well as gone through the assessment order and remand report of the assessing officer. The counsel could not rebut the findings of the Assessing Officer, even though the assessee submitted that the assessee is ready to reconcile the differences, yet the assessee failed to do the same even during inquiry before assessing Officer being conducted as per sec 250(4) after an opportunity was provided by the CIT(A)-VI, Kolkata to assessee to explain it before the Assessing Officer. Effectively complete books of accounts were not produced. In the absence of complete books of accounts, the AO was not able to examine/verify the books of accounts and the differences pointed by him on the order sheet had later on communicated in the letter also. The Assessing Officer was justified in rejecting the books of accounts and estimating the profit in absence of compliance. The assessee did not give any genuine reasons to explain the non-compliance before the then Assessing Officer during assessment proceedings u/s. 143(3). Many discrepancies were noticed by the Assessing Officer and after that there was deliberate non-compliance on the part of the assessee. The assessee did not want to produce the books of accounts again and avoided deliberately to explain the discrepancies to the then Assessing Officer. The assessee wanted now another opportunity before another Assessing Officer knowing that the issue will be limited. The assessee cannot take the benefit of its own deficiencies and non-compliance. However, even now the Assessee has not complied fully before the Assessing Officer as submitted by him in the remand report. There is a legal ..... i.eVigilantibus, non-dermientibus, jurasubvenient," meaning thereby that "the law assist those who are gvigilant and not those who sleep over their rights. 6. Against the above order, the assessee is in appeal before us.
7. We have heard both the ld. Counsel and perused the record. The ld. Counsel of the assessee submitted that there was a mistake on the part of the assessee in not furnishing necessary details before the authorities below. Hence, he prayed before us that the assessee may be granted an opportunity to substantiate its case. He further submitted that now the assessee is ready to submit necessary books of accounts. The assessee is also ready to reconcile all the differences as pointed out by the AO. The ld.CIT/DR, on the other hand, has relied on the orders of the authorities below. He submitted that despite repeated opportunities the assessee has not co-operated with the authorities below and giving the assessee further opportunity would not serve any purpose. ITA No.1581/Kol/11-B-AM M/s. Beardsell Eastern P.Ltd Vs. ITO, W 5(3), Kol. 3 7.1 Upon careful consideration and perusing the record, in our considered opinion in the interest of justice, the matter needs to be remitted to the file of the AO. Accordingly, the AO is directed to consider the issue afresh after giving the assessee adequate opportunity of being heard. 8. In the result, the appeal of the assessee is allowed for statistical purpose. Û Order pronounced in the open court on 8 /09/2014 Sd/- Sd/- [ , Û ] [ , ] [ Mahavir Singh, Judicial Member ] [ Shamim Yahya, Accountant Member () Dated :8/9 /2014 ** PRADIP SPS / Copy of the order forwarded to: 1.. / The Appellant : M/s. Beardsell Eastern (P) Ltd A/3/1, Gillandar House, 8 N.S Road, Kol-1. 2 × / The Respondent- I.T.O W 5(3), Aaykar Bhavan, P-7 Chowinghee Sq, Kol-69. 3. /The CIT, 4. ()/The CIT(A) 5. / DR, Kolkata Bench 6.Guard file. × /True Copy, / By order, / Asstt Registrar ITA No.1581/Kol/11-B-AM M/s. Beardsell Eastern P.Ltd Vs. ITO, W 5(3), Kol. 4
 
 
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