Sh. Vikas Sharma vs ACIT

PER SATBEER SINGH GODARA, JM

This assessee’s appeal for assessment year 2012-13, arises against the Commissioner of Income Tax (Appeals)-19 [in short, the “CIT(A)”], New Delhi’s order dated 04.11.2016 passed in case no. 92/15-16, involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’).

Heard both the parties. Case file perused.

It transpires during the course or hearing that the assessee/appellant is aggrieved against both the learned lower authorities’ respective findings rejecting his books of account under section 145(3) of the Act thereby re-estimating a GP; in assessment order dated 31.03.2015 as upheld in the lower appellate discussion.

Both the parties vehemently reiterate their respective submissions against and in support of the impugned addition. There is hardly any dispute that going by the Assessing Officer’s detailed discussion in para 7.4, the assessee had declared GP @ 5.75% in construction sales receipts qua M/s. Pandit Homes and 11.92% regarding sales receipts from construction business which stood re-estimated at a flat rate of 17.5% resulting in differential income addition of Rs.1,23,11,276/- in his hands. Learned CIT(A)’s detailed discussion at page 7 onwards in para 11 and 12 granted part relief to the assessee whilst re-estimating his GP from 17.5% in issue to 10% regarding M/s. Pandit Home and 7.5% for his company Sri Bankey Bihari Builders and Developers (supra). It is in this factual backdrop that the assessee seeks further relief in the instant appeal in entirety.

Faced with this situation, we make it clear that the assessee/appellant is indeed very fair in not challenging the rejection of his books of account under section 145(3) of the Act in both the lower proceedings. We further find that so far as the learned Assessing Officer’s re-estimation of GP is concerned, he adopted M/s. Gardenia Infra LLP as a comparable entity to adopt GP @ 17.5% in the assessee’s case. This comparable admittedly has been partly interfered with in the CIT(A)’s detailed discussion.

Be that as it may, we are of the considered view in this factual backdrop that the assessee’s GP estimation @ 8% regarding M/s. Pandit Homes as against that declared @ 5.75% would be just and proper with a rider that the same shall not be treated as a precedent. Necessary computation shall follow as per law.

We make it clear before parting that so far as the assessee’s GP estimation regarding its receipt from M/s. Bankey Builders and Developers is concerned, he has declared GP @ 11.92% which followed its re-estimation @ 17.5% in assessment order finally culminating in its reduction to that @ 7.5% in the CIT(A)’s lower appellate discussion. Meaning thereby that the same admittedly is already less than that declared which hardly calls for any interference on our part.

This assessee’s appeal is partly allowed in above terms.