Sanjay Kumar and Co. vs Commissioner of Income Tax

D.K. Jain, C.J.—This appeal u/s 260A of the Income Tax Act, 1961 (for short "the Act"), is directed against the order dated September 30, 2003, passed by the Income Tax Appellate Tribunal, Chandigarh Bench (for short, "the Tribunal"), in I.T.A. No. 221/Chandi/99, pertaining to the assessment year 1994-95.

According to the assessee, the order involves the following substantial questions of law:

(i) Whether the order of the Tribunal in reversing the finding of the Commissioner of Income Tax (Appeals) where the addition of Rs. 4,63,102 was deleted is perverse and bad in law and without application of mind?

(ii) Whether the Tribunal was justified in applying the provisions of Section 145 by applying the gross profit rate of 5 per cent, of the sales under L-14 by ignoring the results shown by the similar other cases and also the sister concern of the appellant and that the regular records having been maintained and no defects having been found and since the sale bills are not issued?

Briefly stated, the material facts are as follows:

The assessee is a liquor contractor dealing in sale and purchase of country liquor as L-14 retail vend. For the relevant assessment year, the assessee declared a gross profit rate of 3.76 per cent. However, during the course of the assessment proceedings, the said rate was considered to be low, as compared to other liquor vends. Accordingly, the Assessing Officer applied a gross profit rate of 5 per cent. which resulted in an addition of Rs. 4,63,102 to the income declared by the assessee.

Aggrieved, the assessee preferred an appeal to the Commissioner of Income Tax (Appeals)(for short, "the Commissioner (Appeals)"), who, following the order of her predecessor for the immediately preceding year, namely, 1993-94, deleted the addition.

Being dissatisfied with the said order, the Revenue took the matter in further appeal to the Tribunal. The Tribunal, relying on its earlier decision in respect of the assessment year 1993-94, estimated the gross profit rate at 5 per cent. Thus, the appeal of the Revenue was allowed. Hence, the present appeal.

Mr. P.C. Jain, learned Counsel appearing for the assessee has submitted that the order is perverse, inasmuch as, the Tribunal has lost sight of the fact that the facts of the present case were different from that prevailing in the assessment year 1993-94. It is asserted that since each assessment year is independent, the Tribunal ought to have considered the matter, uninfluenced by its order for the preceding assessment year. Relying on the decision of the Supreme Court Berger Paints India Ltd. Vs. Commissioner of Income Tax, Calcutta, , learned Counsel has also contended that the gross profit rate declared by the assessee was comparable with the rate declared in cases of other assessees who were engaged in the same business and therefore, the Tribunal could not depart from the view taken in those cases and accepted by the Revenue.

We are unable to agree with learned Counsel. It is evident from the record that before the Commissioner (Appeals), it was pleaded on behalf of the assessee that the facts of the present case were similar to the facts prevailing in the assessment year 1993-94. In fact, accepting the stand of the assessee, the Commissioner (Appeals) applied the same gross profit rate as was applied by the Commissioner (Appeals) in respect of the year 1993-94. Having accepted the order of the Commissioner (Appeals), it is too late in the day for the assessee to change its stance. Moreover, we do not find that any such plea was urged on behalf of the assessee before the Tribunal.

7.1. True that each assessment year is independent of each other, but when the case of the assessee itself was that there was no difference in the fact situation of the two assessment years, namely, 1993-94 and 1994-95 and on the basis whereof, it was successful in getting relief from the Commissioner (Appeals), it cannot now be permitted to resile from its earlier stand. In that view of the matter, the ratio of the decision in Berger Paints India Ltd. Vs. Commissioner of Income Tax, Calcutta, is of no avail to the assessee, inasmuch as, in the instant case, the facts in both the years being similar, the Tribunal has applied the same gross profit rate in respect of the present assessment year, as was applied in the immediately preceding assessment year.

7.2. In our opinion, the aforenoted questions, proposed by the assessee, when tested on the touch-stone of the principles to be kept in view while determining whether the question raised is a substantial question of law or not, cannot be categorised as such. None of the questions proposed is of general public importance or it directly or substantially affects the right of the parties or it calls for discussion for alternative views, see: Sir Chunilal V. Mehta and Sons, Ltd. Vs. The Century Spinning and Manufacturing Co., Ltd., and Santosh Hazari Vs. Purushottam Tiwai (Dead) by Lrs., . The case of the assessee has been decided by the Tribunal on its own peculiar facts.

For the foregoing reasons, no question of law, much less a substantial question of law, arises from the impugned order. Accordingly, we decline to entertain the appeal. Dismissed.