TaxTMI 
TaxTMI 
2024 (2) TMI 1164
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....er, and are being disposed of per a common order. 2. At the outset, it was, on a query, clarified by Shri Jyothison, the learned counsel for the assessee, that though the assessments pursuant to survey were made for AYs 2013-14 to 2019-20, that for the years not in appeal before us, stand accepted, i.e., consequent to first appeal. The facts of the case, explained in brief by him, are that the assessee not returning income in response to notices u/s. 148(1) of the Act, the Assessing Officer (AO) invoked s. 144 of the Act for years up to AY 2018-19. While the AO, on the basis of comparative data, applied a net profit rate of 3% of the turnover, the ld. CIT(A) in appeal restricted it to 2%. For AY 2019-20, for which year the assessee filed a return of income on 31.03.2020, the AO, however, applied a profit rate of 5%, assessing income at Rs. 98,70,252, adopting a turnover of Rs. 20 crores, which stands confirmed in first appeal in view of the income being admitted. A perusal of the record shows that the assessee was during survey found to be not maintaining any books of account. Only daily cash sales and daily stock were found to be maintained, using a software 'GOLDEST'. Shri Abd....
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.... a best judgment basis inasmuch as the assessee did not respond to s. 148 notices. We shall proceed year-wise. 3. AY: 2015-16 - The assessee had initially uploaded the return on 29.04.2016, returning income u/s. 44AD of the Act at Rs. 7,78,986/-, i.e., on a turnover of Rs. 97,37,325, on the basis of the VAT return. This was not accepted as sec. 44AD is applicable only for residents and, accordingly, regarded as invalid. The assessee not responding to the notice u/s. 148(1), income was assessed u/s. 143(3) r/w s. 144C of the Act on 30.11.2021. During assessment proceedings the assessee furnished income and sale figures of other firms in jewellery business, disclosing profit at 0.55% to 2.32% of sale. The AO considered the figures of Kalyan Jewellery Ltd. and Malabar Gold P. Ltd., returning income at 2.52% to 2.64%, and applied a net profit rate of 3% on the turnover of Rs. 10.65 crores, i.e., as per the Goldest data base, i.e., at Rs. 31,96,280. In appeal, the assessee furnished an affidavit dated 21/6/2022 by it's counsel, Shri Jyothison, common for all the years, whereby he avers the assessee to have accepted the turnover and agreeing to be assessed at a net profit rate of 2%. ....
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....id but also unfortunate. No other ground was taken or pressed before us even as the appeal raises several grounds, and which was also confirmed by us from Shri Jyothison during hesaring. The assessee's appeal for AY 2015-16 is accordingly dismissed. 5. AY: 2016-17 - The only objection for this year (as also for AY 2019-20), the primary facts for which are the same as for AY 2015-16, by the assessee, as projected by Shri Jyothison, is that the assessment order has not been signed, either physically or digitally, by the AO. Authentication of a document being a necessary condition for its validity, even as explained in Kilasho Devi Burman v. CIT [1996] 219 ITR 214 (SC), the assessment record, called for, was examined to find a physically signed copy of the assessment order by one, Deeptha M.S., Dy. CIT, International Taxation Circle, Thiruvananhapuram, the extant AO. As explained through her written submissions dated 16.11.2023 by Smt. Devi, also enclosing along with a copy of a letter of even date by the incumbent AO, C.M. Premeela, Asst. CIT (International Taxation) Circle, Thiruvananthapuram, that due to technical problems that at times arise, digital signatures would not wor....
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....uthority or, as the case may be, displayed on its designated website. It is clear that the law has provided for deemed authentication in view of the transmission of the documents electronically from a designated email address or per a designated website. The name of the officer, along with designation, is clearly printed on the assessment order. That is, not only is the assessment order signed physically, it is also deemed to be authenticated. There is no case by the assessee that the conditions of r. 127A have not been complied with; the Revenue stating of both uploading as well as transmission through email ID on the date of passing the assessment order, and which aspect is not in dispute. The assessee has, in view of the foregoing, no case. He not pressing any other ground, his appeal for AY 2016-17 is dismissed as without merit. 6. AY: 2019-20: 6.1 No document for this year, however, stands adduced before us, and which explains our making a separate mention for this year. The assessment order in the appeal file, as indeed in the assessment folder called for from the Revenue, bears only the name and designation of the extant Assessing Officer, both printed thereon. That....
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....the Revenue - not maintaining books of account and disclosing drastically reduced turnover (for all the years up to AY 2018-19), bringing it within the qualifying limit of Rs. 1 cr. (which though stands increased to Rs. 2 cr. w.e.f. AY 2017-18), that does not detract from the fact of his returning a higher profit rate of 8%, which the statute deems as reasonable in case of a retail business, as the assessee's, where the turnover does not exceed the said limit. Though the said return was not accepted due to his residential status, that is a different matter altogether. The returns, in our view, were valid; the only debility being that the assessee could not, availing s. 44AD, avoid scrutiny thereof. Why, the turnover, found to be far in excess of the prescribed limit, in any case ousts the assessee's case for availing the summary procedure u/s. 44AD. What we seek to emphasize is the evidentiary value of the said return/s, a legal document bearing his verification. Admission, as explained in Pullangode Rubber Produce Co. Ltd. vs. State of Kerala [1963] 91 ITR 18 (SC), is an extremely important piece of evidence (Bhagirath Aggarwal v. CIT [2013] 351 ITR 143 (Ker)). That apart, Shri Sh....
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....he other two years, reporting 0.55% and 0.72%, is on a much higher turnover of Rs. 807 cr. and 549 cr. The same, if anything, validates the inference of a decline in the profit rate on account of increased turnover. As we see it, this is due to huge administrative load concomitant to a network of branches spread across the country, while the assessee is a single unit establishment, bearing a much lower administrative expenditure. This aspect has not been examined at any stage, and our limited purview in the matter is with regard to adoption of correct profit rate in the assessee's case, i.e., for AY 2019- 20; there being no dispute in its respect for the preceding years. Here it may also be relevant to clarify that for years prior to AY 2019-20, the Revenue was, in the absence of the assessee returning income u/s. 148, constrained to assess the income u/s. 144 of the Act, which obliged the AO to gather material and confront the same to him. That is, the Act throws the burden for making an informed estimate of the assessee's income for the relevant year/s on the AO. Though the returns voluntarily filed earlier, disclosing profit at 8%, disregarded due to the assessee being a non-....