, , आयकर अपीलीय अिधकरण इंदौर (cid:586)ायपीठ इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI B.M. BIYANI, ACCOUNTANT MEMBER AND SHRI PARESH M JOSHI, JUDICIAL MEMBER ITA No.690/Ind/2025 (AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

(AY: 2010-11)

आदेश / O R D E R Per Paresh M Joshi, J.M.:

This is an Appeal filed by the Assessee under section 253 of the income tax Act 1961,[ herein after referred to as the Act for the sake of brevity] before this tribunal as & by way of a second Appeal. The Assessee is aggrieved by the order bearingNumber:-ITBA/NFAC/S/250/2025-26/1077794992(1) dated 25.06.2025 passed by the Ld. CIT(A) u/s 250 of the Act, which is herein after referred to as the “Impugned order”. The Relevant Assessment year is 2010-11 and the corresponding previous year period is from 01.04.2009 to

31.03.2010.

2. Factual Matrix

2.1 That as and by way of a penalty order made u/s 271(1)(c) of the Act wherein the penalty of Rs.6,50,000/- is levied upon the assessee these proceedings have arisen. That the aforesaid penalty order is dated 31.03.2017 of Dy. CIT-5(1) Bhopal M.P. which is hereinafter referred to as the “Impugned Penalty Order.”

2.2 Further as & by way of an assessment order made u/s 143(3) of the Act, the total income of the assessee was computed & assessed at Rs.37,02,430/-. The total income as per the return of income was at Rs.16,60,780/-. The addition of Rs.20,41,650/- was made by adopting a net profit rate of 8% which was found to be reasonable basis para 4 of the aforesaid assessment order which we reproduce as below:-

“4. It is pertinent here to mention that the assessee had also been assessed on the basis of best judgment for the A.Y. 2009-10. The Hon'ble CIT(A)-11, Bhopal had adopted a net profit rate of 8% in the case of the above assessee. The CIT(A)-II. Bhopal has found

8% N.P. in case of the assessee to be reasonable. The assessed as well as the revenue were in appeal against the order of the CIT(A)- 11, Bhopal. However the Hon'ble ITAT, Indore has confirmed the appellate order of the CIT(A), In case of the present assessment proceedings the material facts are similar and there is no reason why the net profit approved by the two appellate authorities in the case of the assessee for an earlier assessment year should not be adopted for A.Y. 2010-11 also. In case of the assessee, as nothing was produced for verification estimation of net profit is the only reasonable method to work out the business profit earned by the assessee. Relying upon the reasonable estimation of the appellate authorities in the case of the assessee for A.Y. 2009-10-1 also assessed the income of the assessee at the rate of 8% of Net Profit which works out to be Rs. 20,41,650/ -, Therefore the amount of Rs, 20,41,650/ - is being added to the total income of the assessee.”

That the aforesaid assessment order is hereinafter referred to as the “Impugned Assessment Order” & the same is dated 28.03.2013. It is pertinent to mention that in para 5 of the “Impugned Assessment Order” it is recorded as under:-

“Penalty u/ s 271(1)(c) is being initiated separately.”

2.3 That the assessee being aggrieved by the aforesaid “Impugned Penalty Order” dated 31.03.2017 prefers the first appeal u/s 246A of the Act before the Ld. CIT(A) who by the “Impugned Order” has dismissed the first appeal of the assessee on the ground & reasons stated therein. The core grounds & reasons for the dimisssal of the first appeal are as under:-

“5.4 Further, it has been noted by the AO that addition at 8% of net profit on the similar facts was made for the AY 2009-10 and the CIT(A)-II, Bhopal found 8% rate in the case of the appellant to be reasonable. The appellant filed appeal before Hon’ble ITAT against CIT(A)'s order for AY 2009-10. Here also, the Hon'ble ITAT, Indore confirmed the CIT(A) order by finding that 8% rate of Net Profit is reasonable.

5.5 Moreover, it is pertin