Shri Dilip Dattatreya Rade, Jalgaon V. Income-tax Officer,Ward-1(3), Jalgaon

CO 113/PUN/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 8584 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 27 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 03-01-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 03-10-2018
• Assessment Year: 2009-2010
• Appeal Filed On: 07-12-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E BEFORE SHRI R.S. SYAL, VP AND SHRI PARTHA SARATHI CHAUDHURY, JM / ITA NO.590/PUN/2016 / ASSESSMENT YEAR : 2009-10 THE INCOME TAX OFFICER, WARD 1(3), JALGAON. ....... / APPELLANT / V/S. SHRI DILIP DATTATREYA RADE, PROP. OF PRABHAT STEEL CORPORATION, A/34-3, AJANTA ROAD, MIDC, JALGAON-425 003 PAN : AAKPR6628R / RESPONDENT ! /CO.NO.113/PUN/2017 /ASSESSMENT YEAR: 2009-10 (ARISING OUT OF ITA NO.590/PUN/2016) SHRI DILIP DATTATREYA RADE, PROP. OF PRABHAT STEEL CORPORATION, A/34-3, AJANTA ROAD, MIDC, JALGAON-425 003 PAN : AAKPR6628R .. / CROSS OBJECTOR / V/S. THE INCOME TAX OFFICER, WARD 1(3), JALGAON. / RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK REVENUE BY : SHRI SUDHENDU DAS 2 ITA NO.590/PUN/2016 CO NO.113/PUN/2017 A.Y.2009-10 / DATE OF HEARING : 02.01.2019 / DATE OF PRONOUNCEMENT : 03.01.2019 '# / ORDER PER PARTHA SARATHI CHAUDHURY, JM : THIS APPEAL PREFERRED BY THE REVENUE AND CROSS-OBJECT ION BY ASSESSEE EMANATES FROM THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL)-2, NASHIK DATED 20.01.2016 AS PER THE GROUNDS OF APPEAL ON RECORD. 2. AT THE TIME OF HEARING THE LD. AR OF THE ASSESSEE S UBMITTED BEFORE THE BENCH THAT CROSS-OBJECTION IS NOT PRESSED. THEREFORE, WE DISMISS THE CROSS- OBJECTION AS NOT PRESSED. 3. WITH REGARD TO THE APPEAL OF THE REVENUE, THE MAIN GRIEVANCE IS T HAT THE ASSESSING OFFICER HAS ADDED 100% OF THE PURCHASES ALLEGEDL Y DONE THROUGH HAWALA DEALERS OF RS.1,18,33,330/- WHICH IS RESTRICTED TO 6% ADDITION OF THE HAWALA PURCHASES OF RS.1,18,33,330/- BY THE CIT(APPEAL). 4. THE BRIEF FACTS ON THIS ISSUE ARE THAT THE ASSESSEE PURCHASED GOODS TO THE EXTENT OF RS.1,18,33,330/- FROM SUPPLIERS WHO WERE DECLA RED AS HAWALA DEALERS BY THE SALES TAX DEPARTMENT. THE ASSESSING OFFICER HAD ISS UED NOTICE U/S.133(6) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRE D TO AS THE ACT) TO THE SUPPLIERS WHO WERE NOT RESPONDED BY THE SAID SUPPLI ERS AND THEY HAD CHANGED THEIR ADDRESSES. THE ASSESSEE COULD NOT PRODU CE THE SAID SUPPLIERS BEFORE THE ASSESSING OFFICER AS WELL. THE ASSESSEE COULD NOT FILE THE PAPERS REQUIRED BY THE ASSESSING OFFICER, SUCH AS TRANSPORTATION RECEIPT, TRUCK 3 ITA NO.590/PUN/2016 CO NO.113/PUN/2017 A.Y.2009-10 NUMBER, NAME AND COMPLETE ADDRESS OF THE TRANSPORTER, C OPY OF DELIVERY CHALLEN, OCTROI RECEIPT, WEIGHING SLIP ETC. THUS, THE ASSESSIN G OFFICER HAD MADE THE ADDITION OF RS.1,18,33,330/- BY TREATING THE PURCH ASES FROM THE ABOVE SUPPLIERS AS NON-GENUINE WHICH WAS RESTRICTED TO 6 % ADDITION OF THE TOTAL HAWALA PURCHASES BY THE CIT(APPEAL). 5. AT THE TIME OF HEARING ARGUMENT, LD. AR OF THE ASSESSE E SUBMITTED THAT IN THE RELEVANT ASSESSMENT YEAR, THEY HAVE SHOWN GP% @ 2.60 TO WHICH THE LD. CIT(APPEAL) HAS ESTIMATED @6% WHEREAS, THE ASSESSING O FFICER HAD ADDED ENTIRE 100% OF THE PURCHASES AMOUNT. IN THIS SCENARIO, TH E LD. AR APPRAISED THE BENCH TO THE DECISION OF PUNE BENCH OF THE TRIBUNAL IN ITA NO.2065/PUN/2016 WHEREIN ANOTHER DECISION ON THE SAME IS SUE WAS REFERRED TO I.E. M/S. CHHABI ELECTRICALS PVT. LTD. VS. DCIT IN ITA NO.79 5/PUN/2014 RELATING TO ASSESSMENT YEAR 2010-11 ORDER DATED 28.04.2 017. THE RELEVANT PORTION OF THE ORDER IS AS UNDER: 10. NOW, COMING TO THE ISSUE RAISED VIDE GROUND OF APPEAL NO.3, WHEREIN THE ADDITION HAS BEEN MADE ON ACCOUNT OF HAWALA PUR CHASES. THE ASSESSING OFFICER HAD RECEIVED INFORMATION FROM THE SALES TAX DEPARTMENT IN RESPECT OF CERTAIN PURCHASES MADE BY THE ASSESSEE FROM HAWALA PARTIES. THE ASSESSEE WAS ASKED TO ESTABLISH THE DELIVERY OF GOODS AND FURNISH THE EVIDENCES IN THIS REGARD IN O RDER TO PROVE ITS CASE OF PURCHASES MADE. HOWEVER, THE ASSESSEE CLAIMED TH AT THOUGH THE DELIVERY OF CEMENT WAS MADE, BUT IT HAD NO EVIDENCE BY WAY OF LORRY RECEIPTS OR DELIVERY CHALLANS. THE CASE OF ASSESSEE BEFORE US IS THAT INFORMATION AVAILABLE WITH THE ASSESSING OFFICER WA S NOT CONFRONTED TO THE ASSESSEE EXCEPT THE LIST OF HAWALA DEALERS. HE ADMITS THAT THE STATEMENT WAS SHOWN. THE ASSESSEE FURTHER POINTS OU T THAT THE VAT WHICH WAS NOT PAID BY THE SAID HAWALA DEALER HAS BE EN PAID BY THE ASSESSEE. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE PLACED RELIANCE ON THE DECISION OF PUNE BENCH OF TRIBUNAL IN BUNCH OF APPEALS WITH LEAD ORDER IN M/S. CHHABI ELECTRICALS PVT. LTD . VS. DCIT IN ITA NO.795/PUN/2014, RELATING TO ASSESSMENT YEAR 2010-1 1, ORDER DATED 28.04.2017 AND POINTED OUT THAT THE ENTIRE PURCHASE S COULD NOT BE ADDED IN THE HANDS OF ASSESSEE. IN THE TOTALITY OF THE AB OVE SAID FACTS AND CIRCUMSTANCES AND KEEPING IN MIND THE RATIO LAID DO WN BY THE TRIBUNAL IN M/S. CHHABI ELECTRICALS PVT. LTD. VS. DCIT (SUPRA), WE RESTRICT THE ADDITION IN THE HANDS OF ASSESSEE AND DIRECT THE AS SESSING OFFICER TO APPLY GP RATE OF 10% ON THE GOODS PURCHASED, OVER A ND ABOVE THE GP RATE DECLARED BY THE ASSESSEE. ACCORDINGLY, THE GRO UND OF APPEAL NO.3 RAISED BY THE ASSESSEE IS PARTLY ALLOWED. 4 ITA NO.590/PUN/2016 CO NO.113/PUN/2017 A.Y.2009-10 6. ON THE OTHER HAND, LD. DR SUPPORTED THE ORDER OF LD . CIT(APPEAL) WHILE PLACING RELIANCE ON THE ORDER OF ASSESSING OFFICER. 7. WE HAVE PERUSED THE CASE RECORD AND HEARD THE RIV AL CONTENTIONS. WE FIND THAT IN THIS CASE ASSESSEE HAS DECLARED GP% @ 2.60% AND THE ASSESSING OFFICER ADDED 100% OF THE ENTIRE PURCHASES AMOUNT TO THE INCOME OF THE ASSESSEE WHICH WAS RESTRICTED TO 6% BY THE LD. CIT(APPE AL). HOWEVER, ON THE POINT OF ISSUE, THE CASE LAWS I.E. REFERRED TO BY THE LD. AR OF THE ASSESSEE IN ITA NO.2065/PUN/2016 (SUPRA.) WHEREIN, THE ORDER OF M/S. CH ABBI ELECTRICALS PVT. LTD. VS. DCIT (SUPRA) WAS REFERRED TO, THE VIEW TAKEN T HEREIN IS 10% OF THE GP RATE TO BE APPLIED OVER AND ABOVE GP DECLARED BY THE ASS ESSEE. RESPECTFULLY FOLLOWING THE SAID DECISION, WE HOLD THAT GP RAT E OF 10% ON THE GOODS PURCHASED OVER AND ABOVE THE GP DECLARED B Y THE ASSESSEE SHOULD BE APPLIED I.E. GP SHOWN BY THE ASSESSEE @ 2.60% + 10% =1 2.60%. HENCE, GROUNDS OF APPEAL RAISED BY REVENUE ARE PARTLY ALLOWED. 8. IN THE COMBINED RESULT, APPEAL OF THE REVENUE IS PARTL Y ALLOWED AND CROSS OBJECTION FILED BY ASSESSEE IS DISMISSED AS NOT PRESSED. ORDER PRONOUNCED ON 3 RD DAY OF JANUARY, 2019. SD/- SD/- R.S. SYAL PARTHA SARAT HI CHAUDHURY VICE-PRESIDENT JUDICIAL MEMBER / PUNE; / DATED : 3 RD DAY JANUARY, 2019. SB 5 ITA NO.590/PUN/2016 CO NO.113/PUN/2017 A.Y.2009-10 '#$%&'('% / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT (APPEAL)-2, NASHIK. 4. THE PR. CIT-2, NASHIK. 5. #$% &&'( , ) '( , *+, , / DR, ITAT, B BENCH, PUNE. 6. %-. /0 / GUARD FILE. // TRUE COPY // )1 / BY ORDER, &2 ', / PRIVATE SECRETARY ) '( , / ITAT, PUNE. 6 ITA NO.590/PUN/2016 CO NO.113/PUN/2017 A.Y.2009-10 DATE 1 DRAFT DICTATED ON 02.01.2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 03 .01.2019 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER