D.b. Income Tax Appeal v. M/S Rama Ajit Builders & Developers

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 214 / 2016 Pr Commissioner Of IT Jaipur ----Appellant Versus M/S Rama Ajit Builders & Developers ----Respondent D.B. Income Tax Appeal No. 248 / 2016 Pr Commissioner Of IT Jaipur ----Appellant Versus M/S Unique Builders & Developers ----Respondent D.B. Income Tax Appeal No. 268 / 2016 Pr Commissioner Of IT Jaipur ----Appellant Versus M/S Rama Ajit Builders & Developers ----Respondent _____________________________________________________ For Appellant(s) : Mr. K.D. Mathur for Mr. R.B. Mathur For Respondent(s) : Mr. Sanjay Jhanwar with Mr. Prakhul Khurana& Ms. Archana _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE DR. JUSTICE VIRENDRA KUMAR MATHUR Judgment 19/05/2017 In all these appeals, common questions of law and facts areinvolved, therefore, they are decided by this common judgment. 1. By way of these appeals, the appellant has assailed thejudgment and order of the Tribunal whereby the Tribunal hasdismissed the appeal of the department. 2.This Court while admitting the matters framed the following questions of law:- “i) Whether on the facts and circumstances of thecase and in law the ITAT as well as CIT(A) werejustified law in holding that the Assessing Officer haserred in deleting the addition of Rs. 56275218/- eventhough the Assessing Officer’s Action of determiningincome based on percentage completion method asper AS-7 after invoking the provisions of section145(3) of the IT Act has been approved.” In DBITA No.248/2016 i) Whether on the facts and in the circumstances ofthe case and in law the ITAT has erred in deleting theaddition of Rs. 28782752/- made by Assessing Officerby application of section 145(3) of the Act andestimation of profits when the assessee is notmaintainable quantitative and qualitative stockregisters and seized documents like A-2/51 foundfrom the laptop of Sh. Navin Bhutani reflect of ‘onmoney received.” ii) Whether on the facts and in the circumstances ofthe case and in law the ITAT has erred in rejecting theapplication of percentage completion method adoptedby the Assessing Officer, when this rejection meansacceptance of loss returns of the assessee engaged inconstruction and sale of residential/commercialproject. iii) Whether on the facts and in the circumstances ofthe case and in law the ITAT was justified in ignoringthe facts that the two brothers either themselves orthrough their families were actively engaged jointly inthe business of the sister concerns of the assesseeand thus acceptance of ‘on money’ and specific seizeddocuments cannot be ignored for intervention. iv) Whether on the facts in the circumstances of the case and in law the ITAT has erred in ignoring the factthat the document seized from Shri Navin Bhutani (A-2/51), and from Sh. Vibhishek Pal Singh (Partner) (A-2/19) indicated on money received. In DBITA No. 268/2016 i) Whether the Tribunal was justified in holding thatthe Assessing officer as well as CIT(A) have erred inrejecting the books of accounts of the assessee underSection 145(3) of the Act and thereby reversing thefindings given by Assessing Officer as well as CIT(A)ignoring the undisputed facts that the assessee hasfailed to maintain quantitative and qualitative stockregisters and vouch the expenses incurred by it and‘on money’ received by it has not been disclosed.? ii) Whether the Tribunal was justified in rejecting theapplication of percentage completion method by theAO, when this rejection means acceptance of lossreturns of the assessee engaged in construction andsale of residential/commercial projects.? In DBITA No. 268/2016 i) Whether the Tribunal was justified in holding thatthe Assessing officer as well as CIT(A) have erred inrejecting the books of accounts of the assessee underSection 145(3) of the Act and thereby reversing thefindings given by Assessing Officer as well as CIT(A)ignoring the undisputed facts that the assessee hasfailed to maintain quantitative and qualitative stockregisters and vouch the expenses incurred by it and‘on money’ received by it has not been disclosed.? ii) Whether the Tribunal was justified in rejecting theapplication of percentage completion method by theAO, when this rejection means acceptance of lossreturns of the assessee engaged in construction andsale of residential/commercial projects.? iii) Whether the Tribunal was justified in ignoring thefact that two brothers who are partners and activelyengaged jointly in the business of assessee firm andthus acceptance of ‘on money’ can be ignored forintervention.?” 3.Now the issue is squarely covered by the decision takentoday in DBITA No. 23/2013 (CIT Central Jaipur vs. M/s UniqueBuilders & Developers) decided on 19/5/2017, wherein it has beenheld as under:- “In view of the observations made in para 12, 12.1onwards and 13, by the Tribunal, we are of theopinion that the Tribunal while considering thecase has gone in detail and after considering thefacts on record has given a finding. In ourconsidered opinion the Tribunal being a fact findingauthority, it will not be appropriate for us to reappreciate the evidence which has already beenappreciated by the Tribunal. Therefore, in view ofthe decision of this Court and the Gujarat HighCourt, referred to by Mr. Jhanwar, the first issue isanswered in favour of the assessee. In view of thedecision of Supreme Court referred hereinabove, the second issue is also required to be answered infavour of the assessee. In view of the decision ofGujarat High Court in the case of S.A. Builders(supra), the issue No.(iii) is answered in favour ofthe assessee and against the department.” 4.In that view of the matter, the issues are answered in favour of the assessee against the department. 5.All the appeals stand dismissed. (VIRENDRA KUMAR MATHUR),J. (K.S. JHAVERI),J. A.Sharma/56, 59 & 63