Guatam Chand Binaikia , Jaipur vs Assessee

Jh vkj-ih-rksykuh] U;kf;d lnL; ,oa Jh Vh-vkj-ehuk] ys[kk lnL; ds le{k BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM

vk;dj vihy la-@ITA No. 271/JP/2012 fu/kZkj.k o"kZ@Assessment Year : 2007-08

Shri Gautam Chand Binaikia, cuke The I.T.O., D-3, Raman Marg, Tilak Nagar, Vs. Ward-6(1), Jaipur. Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AGEPB 7962 L vihykFkhZ@Appellant izR;FkhZ@Respondent

fu/kZkfjrh dh vksj ls@ Assessee by : Written Submission jktLo dh vksj ls@ Revenue by: Shri Ajay Malik (Addl.CIT))

lquokbZ dh rkjh[k@ Date of Hearing : 04/12/2014 ?kks"k.kk dh rkjh[k@ Date of Pronouncement : 13/02/2015

vkns'k@ ORDER

PER: R.P. TOLANI, J.M.

This is an appeal filed by the assessee against the order dated

23/01/2012 by the learned CIT(A)-II, Jaipur for A.Y. 2007-08.

Respective grounds of appeal are as under:

"1. The learned CIT(A) erred in law as well as on the facts of the present case in passing the order ex parte without providing the assessee an opportunity of being heard.

2 ITA 271/JP/2012_ Gautam Chand Binaikia Vs. ITO

2. The learned CIT(A) erred in law as well as on the facts of the present case in not accepting the book result of the assessee though the same were better from the preceding year in all respect.

3. The learned CIT(A) erred in law as well as on the facts of the present case in upholding the disallowance of purchases @ 25% while holding unverifiable and consequently sustaining the addition of Rs. 970255/-.

4. The learned CIT(A) erred in law as well as on the facts of the present case in not following the direct decisions of Hon'ble Jaipur Bench being applicable on the facts of the present case.

5. The learned CIT(A) erred in law as well as on the facts of the present case in sustaining the following disallowances:

Rs. 4595/- Telephone Exp. Rs. 10600/- Travelling Exp. Rs. 5107 Conveyance Exp.

6. The appellant prays your Honour's indulgence to add, amend, modify or delete all or any ground of appeal."

2. None appeared on behalf of the assessee. Written submissions

are filed, which are taken into consideration. It is contended in the

written submissions, that in a recent decision in the case of Shri Anuj

Kumar Varshney & Ors. Vs. ITO & Ors. In ITA No. 187/JP/2012 dated

22/10/2014, the Hon'ble ITAT has taken a view that 15% of such

unverifiable purchases of semi precious stones should be sustained. The 3 ITA 271/JP/2012_ Gautam Chand Binaikia Vs. ITO

facts of the present case, therefore, the Shri Anuj Kumar Varshney

decision may be applied in the instant case.

3. Apropos telephone, travelling and conveyance expenses, it is

pleaded that the expenditure was incurred wholly and exclusively for

the purpose of business of the assessee, therefore, there was no

personal element involved therein. The learned Assessing Officer has

not pointed out any specific items in this respect, therefore, the

additions are unjustified and it should be deleted.

4. Learned D.R. contends that the department may file appeal

against the order of the ITAT in the case of Anuj Kumar Varshney,

before High Court .

5. Apropos the other additions, the learned CIT(A) relied on various

judgments i.e. decision in the case of Suresh L. Agarwal Vs ITO (2010-

TIOL 649 ITAT), decision of Hon'ble Gujarat High Court in the case of

CIT Vs. Chandravilas Hotel (164 ITR 102) and Hon'ble Delhi High Court

decision in the case of Goodyear India Ltd. Vs. CIT (246 ITR 116).

6. We have heard the rival contentions of both the parties and

perused the material available on the record. This Bench in the case of

Shri Anuj Kumar Varshney & Ors. Vs. ITO & Ors. In ITA No.

187/JP/2012 dated 22/10/2014 has held as under:-

4 ITA 271/JP/2012_ Gautam Chand Binaikia Vs. ITO

"We have heard the rival contentions of both the parties and perused the material available on the record. As discussed in above cases, the material available on record established that in Jaipur, a rampant practice is in vogue to get and issue accommodation bills of purchases to deflate the profit. The learned Assessing Officer made disallowance @ 25% of such bogus purchases on the basis of decision in the case of Sanjay Oil Cake Industries and Vijay Protein Ltd. (supra). In our view the 25% disallowance appears to be higher side, therefore, keeping in view of the facts of the assessee's case as well as other cases as discussed above, we feel that 15% disallowance out of bogus purchases is reasonable on unverifiable purchases and will meet the ends of justice. The rejection of books of account is justified. The assessee gets relief partly".

Facts and circumstances of this case are similar consequently, we

find merit in the written submission of the assessee to restrict the

disallowance to 15%, rejection of books of account is upheld. Thus we

hold that the addition qua these unverified purchases shall be restricted

to 15%, accordingly, we direct the Assessing Officer to work out the

disallowance.

7. Apropos the remaining expenditures i.e. telephone, travelling and

conveyance, we find no infirmity in the orders of lower authorities,

which are supported by the above mentioned judicial precedents.

Except oral contention assessee could not demonstrate absence of 5 ITA 271/JP/2012_ Gautam Chand Binaikia Vs. ITO

personal element in these expenditures besides the books of account of

the assessee remained rejected. In view thereof, the estimate made by

the lower authorities is upheld.

8. In the result, the assessee appeal is partly allowed.

Order pronounced in the open court on 13/02/2015.

Sd/- Sd/- ¼Vh-vkj-ehuk½ ¼vkj-ih-rksykuh½ (T.R. Meena) (R.P.Tolani) ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member

Tk;iqj@Jaipur fnukad@Dated:- 13th February, 2015

*Ranjan

vkns'k dh izfrfyfi vxzsf'kr@Copy of the order forwarded to:

1. vihykFkhZ@The Appellant- Shri Gautam Chand Binaikia, Jaipur

2. izR;FkhZ@ The Respondent- The ITO, Ward 6(1), Jaipur.

3. vk;dj vk;qDr@ CIT(A)-II, Jaipur

4. vk;dj vk;qDr@ CIT, Jaipur

5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur

6. xkMZ QkbZy@ Guard File (ITA No. 271/JP/2012)

vkns'kkuqlkj@ By order,

lgk;d iathdkj@Asst. Registrar