P.ramar v. The Commissioner Of Income Tax

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 07.08.2014 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM W.P(MD)No.1166 of 2013 andM.P.(MD).Nos.1 and 2 of 2013 P.Ramar... Petitioner Vs. 1.The Commissioner of Income Tax, No.2, V.P.Rathinasamy Nadar Road, Bibikulam, Madurai-625 002. 2.The Income Tax Officer, Ward I, No.4, North Cotton Road, Thoothukudi-628 001.... Respondents Prayer:- Writ Petition filed under Article 226 of the Constitution ofIndia praying for the issuance of a Writ of Certiorari, calling for therecords relating to the proceedings of the impugned order dated09.07.2012 in C.No.407/15/CIT-I/2011-12 dated 09.07.2012 on the file ofthe 1[st] respondent and quash the same. For Petitioner: Mr.G.Prabhu RajaduraiFor Respondents: Mr.R.Krishnamurthi ORDER The petitioner is an assessee under the Income tax Act and thechallenge in this writ petition is to an order passed by the respondentdated 09.07.2012. By the impugned proceedings, the revision petitionfiled by the petitioner under Section 264 of the Income Tax Act beforethe first respondent was dismissed. 2.The petitioner is carrying on the business of purchase and sale ofsalt and he had filed a return of income for the assessment year 2009-2010 admitting a taxable income of Rs.1,61,590/-. The return wasprocessed under Section 143(1)(a) of the Income Tax Act and subsequently,the case was selected for scrutiny and notice under Section 143(3) of theIncome Tax Act, was issued to determine the total income of thepetitioner as to Rs.23,07,820/- after making some additions anddisallowances and raising a demand of Rs.9,19,151/-. 3.The petitioner did not file an appeal as against the order butchose to file a petition under Section 264 of the Income Tax Act beforethe first respondent on 09.02.2012 raising various contentions. The firstrespondent called for a report from the Assessing Officer which washttps://hcservices.ecourts.gov.in/hcservices/furnished along with details. The Assessing Officer stated that theassessee has no material evidence to prove that the Gross Profit ratio is only 4% in the same industry as against 14.9% which was admitted by theassessee himself earlier at the time of filing of the returns. After,affording an opportunity of hearing to the petitioner and considering therepresentations, the first respondent considered the petitioner'scontentions and rejected the same stating that but for the detection ofsuppression in sales by the Assessing Officer the assessee would not haveadmitted the same for taxation. Regarding addition of Gross Profit at 4%the first respondent held that the assessee has not produced any materialevidence for adopting Gross Profit ratio at 4%. The trading accounts oftwo concerns produced before the first respondent, were rejected as theywere not authenticated documents and therefore, cannot be relied.Aggrieved by the said order, the petitioner has approached this Court. 4.Heard the learned counsel for the parties and perused the materialsplaced on record and the counter affidavit filed by the first respondent. 5.From the averments made in the counter affidavit, it is seen thatthe Assessing Officer adopted Gross Profit ratio of 14.9% as it isadmitted by the assessee in the return of income. 4.Heard the learned counsel for the parties and perused the materialsplaced on record and the counter affidavit filed by the first respondent. 5.From the averments made in the counter affidavit, it is seen thatthe Assessing Officer adopted Gross Profit ratio of 14.9% as it isadmitted by the assessee in the return of income. 6.The learned counsel for the petitioner submitted that thepetitioner met with an accident and at the time of filing of returns, hehad erroneously admitted the Gross profit ratio at 14.9%. The Grossprofit is not more than 6% in the trade and for which purpose though thepetitioner produced records, the same were rejected by the firstrespondent as they were not authenticated. Therefore, the petitionerwould plead that he may be afforded an opportunity to produceauthenticated copies of the records which are relevant in respect of theother assessee carrying on similar trade. Therefore, the petitioner wouldstate that he has suffered mentally, physically and financially and ifrelief is granted to the petitioner, he would be greatly benefited andrelieved from financial hardship. 7.From a perusal of the impugned order, it is seen that thepetitioner's case was not accepted on the ground that the recordsproduced by him were not authenticated and if the records wereunauthenticated, returns of submitted by other persons carrying on thesimilar business within the jurisdiction of the second respondentAssessing Officer, those records could have been called for from theconcerned department or the officers. However, such procedure was notresorted to. Be that as it may, the petitioner now seeks for one moreopportunity stating that he has got authenticated copies of thosedocuments and if opportunity is granted to the petitioner to approach thecommissioner, the petitioner will be able to place all the materials. 8.Considering these facts, this Court is of the view that thepetitioner may be afforded an opportunity subject to certain conditions.From the perusal of the assessment, it is seen that the assessee havebeen assessed to at Rs.5,97,346/- including tax surcharge, EducationCess, interest under Section 243-A and B of the Income Tax Act. Thebalance tax payable has been arrived at Rs.9,19,151/-. In the revisionpetition filed by the assessee on 09.07.2012, the assessee has statedthat he has already paid Rs.25,000/-. Hence, there will be a direction tohttps://hcservices.ecourts.gov.in/hcservices/the assessee to pay a sum of Rs.2,00,000/- before the second respondentand produce proof of such payment before the first respondent and on production of such proof, the first respondent shall reconsider itsearlier order by considering the authenticated documents filed by thepetitioner in support of his claim. If such application is filed, thefirst respondent shall consider the same and pass fresh orders on meritsin accordance with law. The payment as ordered above shall be made by thepetitioner within a period of eight weeks form the date of receipt of acopy of this order. With the above direction, the writ petition is disposed of. No costs.Consequently, connected miscellaneous petitions are closed. /True copy/ Sd/-Assistant Registrar (Crl.side) To Sub Assistant Registrar 1.The Commissioner of Income Tax, No.2, V.P.Rathinasamy Nadar Road, Bibikulam, Madurai-625 002. 2.The Income Tax Officer, Ward I, No.4, North Cotton Road, Thoothukudi-628 001. +1cc to MR.G.PRABHU RAJADURAI, ADVOCATE IN SR : 44460+1cc to MR.R.KRISHNAMOORTHY, ADVOCATE IN SR : 44336NsSR : 11.09.2014 : 3p/5c W.P(MD)No.1166 of 201307.08.2014