Shri Girish Prakash Vernekar, Belgavi V. Income Tax Officer, Ward - 1(2), , Belgavi

CO 41/PAN/2017

AI Insights

The case involves Girish Prakash Vernekar, who appealed against the decision of the Commissioner (Appeals) which directed the Assessing Officer to adopt a gross profit rate of 7.5% on unregistered dealer (URD) cash purchases amounting to Rs.31,62,176. The Assessing Officer had initially disallowed 10% of such purchases, following which the Commissioner (Appeals) reduced this to 7.5%, referencing a previous Tribunal order for a different assessment year. The Tribunal dismissed the appeal, affirming the 7.5% addition, as the assessee had not satisfactorily proven the genuineness of the purchases, and the books of accounts had been rejected by the Assessing Officer.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 136931 (ITAT-PANAJI)
• Duration Of Justice: 5 year(s) 9 month(s) 22 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 13-09-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: WT(D)
• Next Hearing Date: 11-09-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 21-11-2017
• Other Referred Cases: ITA No.7-PNJ-2012, ITA No.159-PNJ-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P.S. SHIVSHANKAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI (AT e-Court, PUNE) BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER Cross Objection No.41/PAN/2017 (Arising out of ITA No.262/PAN/2017) नधा रण वष / Assessment Year : 2012-13 Girish Prakash Vernekar, 264, Mahalasa-Krupa, Shastrinagar, Belagavi PAN : ADNPP5618F Vs. ITO, Ward-1(2), Belgavi Cross Objector Appellant in the appeal आदेश / ORDER PER R.S.SYAL, VP : It is a recalled matter in respect of Ground No.2 by the assessee in his Cross Objection inasmuch as the earlier order passed was recalled by the Tribunal vide its later order in M.A.No.03/PAN/2019 dated 17-08-2022. 2. Ground No.2 taken by the assessee in the cross objection reads as under : “2. Learned Commissioner (Appeals) is not justified in directing AO to adopt G.P. @7.5% on URD cash purchases of Rs.31,62,176/- following the order of the ITA No.7-PNJ-2012 dated 20-4-2012 of Asst. Year 2008-09. Learned Commissioner (A) totally lost sight of Assessee by Shri A.S. Patil Revenue by Shri P.S. Shivshankar Date of hearing 13-09-2023 Date of pronouncement 14-09-2023 C.O. No.41/PAN/2017 Girish Prakash Vernekar 2 latest ITA No.159-PNJ-2014 of Assessment Year 2009-2010 wherein entire addition on URD Cash Purchases has been deleted. Hence, additions of Rs.2,37,163/- confirmed by CIT(A) requires to be deleted.” 3. The factual matrix anent to this Ground No.2 is that the assessee made total purchases of Gold bullion at Rs.93,65,718/- and of Silver at Rs.42,33,904/- from unregistered dealers totalling to Rs.1,35,99,622/-. The Assessing Officer (AO) allowed opportunity to the assessee to prove the genuineness of the purchases, which the assessee could not do satisfactorily. Following the view taken for the earlier years, the AO made disallowance at 10% of such purchases. Such disallowance amounted to Rs.13,59,962/-. In addition, the AO also made an addition of Rs.33,08,707/- towards low gross profit rate. When the matter came up before the ld. CIT(A), he deleted the addition towards the gross profit rate. As regards the disallowance made by the AO at 10% of URD purchases, the ld CIT(A), following the Tribunal order for the A.Y. 2008-09, restricted it to 7.5%. Aggrieved thereby, the assessee has come up in appeal before the Tribunal. 4. After considering the rival submissions and going through the relevant material on record, it is seen that the Tribunal in its order for the A.Y. 2008-09 restricted the addition at 7.5% of purchases of Gold and Silver bullion from unregistered dealers. It is in C.O. No.41/PAN/2017 Girish Prakash Vernekar 3 conformity with this order that the ld. CIT(A) restricted the addition to this level in the impugned order. The ld. AR contended that no addition at all could have been made because the Tribunal for the A.Y. 2009-10 deleted the entire addition. On perusal of the latter order of the Tribunal, it comes to the light that the Tribunal deleted the addition on the ground that the AO did not reject the books of accounts and made the addition. Adverting to the facts of the instant case, it is found that the AO did reject the books of accounts for the year under reference. Once the AO rejected the books of accounts and made two additions, namely, the first on the account of low gross profit rate and the second at 10% of URD purchases from unregistered dealers and the ld. CIT(A) deleted the addition on account of low gross profit rate, there remains no reason for the assessee to be aggrieved by the sustenance of addition at 7.5% of purchases of Gold and Silver bullion from unregistered dealers, which were admittedly not justified to the satisfaction of the AO. Following the view taken in the assessee’s own case for the A.Y. 2008-09, we uphold the impugned order restricting the addition to 7.5% of the URD purchases from unregistered dealers. This ground is, therefore, not allowed. C.O. No.41/PAN/2017 Girish Prakash Vernekar 4 5. In the result, the cross objection is dismissed to this extent. Order pronounced in the Open Court on 14 th September, 2023. Sd/- Sd/- ( S.S.VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; िदनांक Dated : 14 th September, 2023 सतीश आदेश की ितिलिप अ ेिषत/Copy of the Order is forwarded to: 1. अपीलाथ / The Appellant; 2. थ / The respondent 3. The Pr.CIT concerned 4. DR, ITAT, Panaji Bench, Panaji 5. गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune Date 1. Draft dictated on 13-09-2023 Sr.PS 2. Draft placed before author 14-09-2023 Sr.PS 3. Draft proposed & placed before the second member JM 4. Draft discussed/approved by Second Member. JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *