M/S Om Prakash & Party v. The Commissioner Of Income Tax, Jaipur

1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHANBENCH AT JAIPUR. D.B. Income Tax Appeal No. 166/2002 M/s Om Prakash & PartyVSThe Commissioner of Income Tax, Jaipur DATE OF ORDER ::: 25[th] October, 2016HON'BLE MR. JUSTICE K.S. JHAVERIHON'BLE MR. JUSTICE MAHENDRA MAHESHWARI Mr. P.K. Kasliwal , for the appellant.Mr. Nikhil Simlote for Mr. R. B. Mathur, for the respondent. BY THE COURT:- (Per Hon'ble Jhaveri, J.) 1.By way of this appeal, assessee-appellant has challengedthe judgment and order of the Tribunal whereby the tribunal haspartly allowed the appeal and confirmed the order of the CIT(A).2.The brief facts of the case are that the appellant is a liquorcontractor. The liquor contract had been taken for two financialyears i.e. 1989-90 & 1990-91, and this is the first year of thecontract. The contract of country liquor was for Rs.4,37,54,300/-out of which contract worth Rs.2,16,87,295/- was fulfilled byactually lifting the goods and the balance of Rs.2,20,66,704/-was met by depositing short licensing fee. The net profit earnedas per the profit & loss account was of Rs.4,22,14,499/-. Thesales realisation was of Rs.9,64,26,660/- as against the purchaseprice of Rs.2,81,99,126/- and the net profit rate works out to43.77% on the sales. In the original return filed by the appellanton 30.10.1990, the appellant had offered that the profit oncountry liquor contract should be taxed at 40% of the purchaseprice in accordance with the Section 44AC of the Income Tax Actwhich works out to Rs.1,12,77,650/-. However, the appellant filed a revised return on 5.6.1992 offering the book profit ofRs.4,22,14,499/- earned in the contract of the country liquor.Subsequently, the appellant vide its letter dated 20.10.1992requested the DCIT to ignore the revised return and only thedeemed profits u/s 44AC should be taxed. The assessing officerhas taxed the appellant on the books profits of Rs.4,22,14,499/-and has given detailed reasons for the same. 3.This court while admitting the matter on 15.11.2002framed following substantial questions of law:- "Whether on the facts and circumstances of thecase, the ITAT was justified in sustaining a lossamounting to Rs. 12,76,996/- made by theAssessing Officer in IMFL/Beer (whole sale)business on the ground that the rebate given onthe goods transferred to retail business from wholesale business was not proper, irrespective of thefact that the loss in retail business has beenallowed after considering the fact of said rebate,hence such finding is not contradictory andconclusion arrived at by the ld. ITAT is notperverse? Whether on the facts and circumstances of thecase, the ld. ITAT was justified in ignoring andmisappreciating and not considering the facts,evidence, material and submissions available onrecord, hence the impugned order and findingarrived at by the ld. ITAT is not perverse?" 4.Counsel for the appellant has taken us to both the orders passed by the authorities and contended that they havecommitted error in sustaining a loss amounting to Rs.12,76,996/- made by the Assessing Officer in IMFL/Beer (wholesale) business on the ground that the rebate given on the goodstransferred to retail business from whole sale business was notproper, irrespective of the fact that the loss in retail business hasbeen allowed after considering the fact of said rebate. In our view the finding is not contradictory and conclusion arrived at bythe ld. ITAT is not perverse. 5.To support his case, he has taken us to the order of thetribunal and contended that view taken by the tribunal has to be confirmed and the order of AO is required to be reversed. 6.Counsel for the respondent has contended that these areconcurrent findings of both the authorities on the issue whichwere framed, substantial question of law is required to beanswered. view the finding is not contradictory and conclusion arrived at bythe ld. ITAT is not perverse. 5.To support his case, he has taken us to the order of thetribunal and contended that view taken by the tribunal has to be confirmed and the order of AO is required to be reversed. 6.Counsel for the respondent has contended that these areconcurrent findings of both the authorities on the issue whichwere framed, substantial question of law is required to beanswered. 7.In view of the concurrent findings the issue is required tobe answered in favour of the department and against theassessee & observations made by CIT(Appeals) which areconfirmed by the Tribunal requires no interference. 8.The appeal stands dismissed. (Mahendra Maheshwari), J. (K.S. Jhaveri), J. Brijesh13.