Commissioner of Income Tax vs Kuber Resorts Ltd.

CM Appl. No. 8924/2009 (exemption)

Allowed, subject to just exceptions.

CM Appl. No. 8925/2009

For the reasons stated in this application, delay in refilling the appeal is condoned.

CM stands disposed of.

ITA No. 777/2009

The order passed by the Assessing Officer in respect of the assessment year 1999-2000 of the assesses making addition of Rs. 11,52,055 was

deleted by the CIT(A), which order has been upheld by the ITAT observing as under:

8.2 Assessee did not furnish any return of income. No. books of accounts were also produced during the asstt. Proceedings. In the absence of

return of income and the necessary details, the Assessing Officer estimated income from hotel receipts at Rs. 11,52,055 as was so declared in the

immediate proceedings assessment year. However, the CIT(A) has deleted the addition by observing that the Assessing Officer has not been able

to prove the existence of any income earned by the assessee in the assessment year under consideration in as much as the office of the assessee

company was mostly closed during the period relevant to the assessment year 1999-2000, which is under consideration. After considering the

totally of the facts and circumstances of the case and having regard to the fact that the assessee failed to furnish any return of income or failed to

furnish any evidences before the Assessing Officer that no business was actually carried out during the year under consideration, the CIT(A) was

unjustified in deleting the whole of the addition made by the Assessing Officer on account of income from hotel receipts. It is not in dispute that the

assessee had shown receipt of Rs. 11,52,055 in that the hotel business was not in immediate, preceding assessment year. It is not the case of the

assessee that hotel business was not in existence. No evidences have been produced to show that the hotel was closed down throughout the year.

The assessee has not co-operated by giving details as to its business activities. Therefore, the Assessing Officer was justified in estimating the

income to be best of his judgment u/s 144 of the Act. The past record of the assessee is a relevant criteria on the basis of which the current year''s

income can be reasonably determined. In the immediate preceding year, the assessee had shown gross receipts of Rs. 11,52,053 against which

certain expenses were claimed. The Assessing Officer has taken the gross receipts as income without giving any deduction on account of expenses

necessary to be incurred for carrying on the business activities. The Assessing Officer was, therefore, unjustified in taking the income from hotel

receipts at gross receipts of last year without considering the expenses. In the immediate preceding year, the income from hotel business was

estimated by the Assessing Officer at Rs. 15,708. Taking this income assessed for the assessment year 1998-99 at Rs. 15,708 as base, we

reasonably estimate the income from hotel resort at Rs. 16,000. We, therefore, direct the Assessing Officer to take the income from hotel at Rs.

16,000 while computing the assessee''s total income liable to tax under the Income Tax Act. The order of CIT(A) is, thus, modified accordingly.

Therefore, no substantial question of law arises for our consideration. This appeal is, accordingly, dismissed.