AI Drafter 
TaxTMI 
TaxTMI 
2026 (2) TMI 693
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....ation based on industry standards. 3. The learned CIT(A) has failed to appreciate that although the assessee owned more than ten trucks and hence was not eligible for the presumptive scheme under Section 44AE of the Income-tax Act, 1961, the said provision still provides a reasonable basis for estimating income in transport business cases, particularly in the absence of proper books of account, as upheld by the Hon'ble ITAT, Chennai, in the appellant's own case for AY 2015-16 in ITA No.75/CHNY/2019 dated 30.05.2019, 4. The learned CIT(A) has erred in not directing the Assessing Officer to estimate the income of the assessee by taking guidance from the presumptive taxation scheme under Section 44AE, to ensure a fair, equitable, and non-arbitrary estimation. 5. That the income as estimated by the Assessing Officer is excessive, unjustified, and not supported by any comparable cases or consistent accounting method. 6. That the learned CIT(A) has erred in confirming the addition made without assigning cogent reasons and without considering the past history and business realities of the transport sector. 7. The learned CIT(A) has erre....
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....ers, bills related to first 8 months of the financial year under consideration were destroyed in the flood in December 2015(evidence in the form of property loan sanction letter enclosed) and hence the same cannot be produced. 4. The Assessing Officer did not accept the contention of the assessee and referred the case for special audit u/s. 142(2A) of the Act to M/s.Jain Bafna and Associates, CAs. The special audit report was given to Assessing Officer. Based on the same, the Assessing Officer assessed the total income at Rs. 1,51,16,889/- as against the returned income of Rs. 8,30,570/- by making following additions to the total income of the assessee for the assessment year under consideration and passed an order u/s. 143(3) of the Act dated 20.08.2019: Particulars Amount in Rs. Returned Income 8,30,570 Sale of land - LTCG 25,83,109 Income u/s. 64 gift to wife 27,083 Purchase of vacant land u/s. 69 16,85,000 Sale of vacant landu/s.68 25,00,000 Sundry creditors u/s. 68 22,16,745 Sundry Debtors u/s. 68 18,25,802 Lease Advance u/s. 68 30,00,000 Acceptance of loan in Cash u/s. 68 2,00,000 Disallowances u/s. 40a(ia) (in....
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....er in ITA No.75/Chny/2019 dated 30.05.2019 for the A.Y. 2015-16, wherein in assessee's own case, the Tribunal directed the Assessing Officer to take guidance from provisions of Section 44AE of the Act, when the assessee was owning 16 Transport vehicles. Further, the said decision has been followed by the Tribunal in assessee's own case in ITA No.2283 and 2284/Chny/2025 dated 24.10.2025 for the A.Y.2011-12 and 2012-13 and directed to follow the provisions of section 44AE of the Act to arrive at the total income of the assessee. In view of the above arguments the ld.AR for prayed deleting the additions made by the Assessing Officer and allow the claim of the provisions of section 44AE of the Act for the impugned year also. 11. Per contra, the ld.DR supported the orders of the Assessing Officer and the ld.CIT(A) and submitted that the assessee is owning morethan 10 vehicles and hence the provisions of section 44AE is not applicable to the present facts of the case. Therefore, the ld.DR prayed for confirming the order of the ld.CIT(A). ITA No. 2283 & 2284/Chny/2025 for the A.Y. 2011-12 & 2012-13 "4.0 We have heard the rival submissions and perused the materials available....
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....owance reduced to 7%. 6.0 We find that the identical issue was subject matter of consideration by this Tribunal in assessee's own case for assessment year 2015-16 in ITA No.75/Chny/2019 dated 30.05.2019 wherein it was held as under:- "...5. Being aggrieved by the order of the Id. Commissioner of Income Tax (Appeals), the appellant is in appeal before us in the present appeal. It is contended before us that though the provision of presumptive taxation u/s. 44AE of the Act are not strictly applicable to the assessee, guidance can be taken from the provision of Section 44AE and presumptive rate of tax can be applied placing reliance on the decision of Ahmadabad Bench (camp at Surat) of the Tribunal in the case of Gayatri Corporation vs. ITO in ITA Nos.894 & 1099/Ahd/2014, dated 05.04.2017. 6. On the other hand, the Id. Sr. Departmental Representative placed reliance on the orders of lower authorities 7. We heard the rival submissions and perused the material on record. The Assessing Officer made several disallowance resulting in assessed income two or three times higher than the returned income. Assessee is engaged only in transport business owning ....
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....As stated earlier, the decision rendered for assessment year 2011- 2012 shall apply mutatis mutandis for assessment year 2012-13 also in view of identical facts except with variance in figures." 12. We have carefully considered the rival submissions, perused the material available on record and gone through the orders of the authorities along with the judicial precedents relied upon. The assessee is an individual engaged in the business of lorry transport. It is an admitted fact that the assessee owned more than ten goods carriages during the year under consideration. It is also undisputed that the assessee's books of account, vouchers and supporting evidences for a substantial part of the relevant previous year were destroyed in the floods that occurred in December 2015, a fact which has not been controverted by the Revenue. The assessee's case was selected for limited scrutiny. However, owing to non-production of complete books of account, the Assessing Officer referred the matter for special audit under section 142(2A) of the Act and thereafter proceeded to assess the income by making multiple additions u/s. 68, 69, 40(a)(ia) and by estimating business income, resulting in an....
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....re four. Therefore, the number of goods carriages plied by the assessee was well within the ambit of the section 44AE. The Assessing Officer has rejected the book result and has estimated the income by making various disallowance out of the expenses claimed by the assessee. He also enhanced the receipt shown by the assessee. The estimated disallowance made by the AO were partly reduced by the CIT(A). Therefore, undisputedly, in the assessee's case, the actual dispute is only with regard to estimation of the income from trucks plying business. In our opinion, when the Legislature has provided some formula for estimation of income in the case of a transporter, who owns less than ten goods carriages, there would not be any justification for not estimating the income of the assessee as per the formula prescribed in section 44AE. It is irrelevant whether the revised return furnished by the assessee is ITA No.2626/Ahd/2010 Kesharbhai G.Chaudhary vs. ITO Asst.Year - 2006-07 valid or not. When the question of estimation of the income of a transporter comes, Section 44AE is a good guideline in the case of transporter who owns less than ten goods carriage. In view of the above, we direct....