ITO 6(2)(4), MUMBAI V. SHRI. RAJAN JANARDAN GHADGE , MUMBAI

ITA 1041/MUM/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6267 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 10-02-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VARMA LD
• Keywords: Bogus purchase; Depreciation
• Section: 143(3); 133(6)

Judgement Text

1 - IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI , , BEFORE HONBLE SHRI C.N. PRASAD , JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) 1 . ./ I.T.A. NO. 1041 /MUM/20 20 ( / ASSESSMENT YEAR : 2010 - 11 ) ITO 6(2)(4 ) 5 TH FLOOR, R. NO. 513 AAY K AR BHAVAN MUMBAI - 400 020 / VS. S HRI RAJAN JANARDHAN GHADGE 301, SHIVAI PLAZA, PLOT NO. 79(A - 3), MAROL CO - OP. INDUSTRIAL ESTATE MAROL NAKA, ANDHERI (EA ST ) MUMBAI - 400 059 ./ ./ PAN/GIR NO . A A LPG - 1327 - K ( / APPELLANT ) : ( / RESPONDENT ) REVENUE BY : MS . SMITA VARMA LD. SR. DR ASSESSEE BY : NONE / DATE OF HEARING : 02 /09 /2021 / DATE OF PRONOUNCEMENT : 02/09/2021 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEAL BY REVENUE FOR AY 20 10 - 11 ARIS ES OUT OF THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) - 12 MUMBAI [CIT(A)] DATED 26/11/2019 IN THE MATTER OF ASSESSMENT FRAMED BY LD. ASSESSING OFFICER (AO) U/S 143(3) R.W.S. 147 ON 14/03/2016. THE LD. CIT(A) HAS GRANTED PARTIAL RELIEF TO THE ASS ESSEE ON ACCOUNT OF ALLEGED BOGUS PURCHASES AGAINST WHICH THE REVENUE IS IN FURTHER APPEAL BEFORE US. 2 2. AT THE TIME OF HEARING, NONE APPEARED FOR ASSESSEE . H OWEVER, THE MATERIAL ON RECORD WAS SUFFICIENT FOR DISPOSAL OF THE APPEAL. THE LD. DR PLEADED FOR R ESTORATION OF ASSESSMENT AS FRAMED BY LD. AO. THE ASSESSEE BEING RESIDENT INDIVIDUAL IS STATED TO ENGAGED IN PRINTING OF STATIONERY ITEMS. 3. THE CASE WAS REOPENED PURSUANT TO RECEIPT OF CERTAIN INFORMATION FROM SALES TAX DEPARTMENT, MAHARASHTRA ON THE B ASIS OF WHICH IT WAS ALLEGED THAT THE ASSESSEE MADE SUSPICIOUS PURCHASES OF RS.3.87 LACS FROM 4 ENTITIES AS DETAILED IN PARA - 2 OF THE ASSESSMENT ORDER. NOTICES ISSUED U/S 133(6) DID NOT ELICIT SATISFACTORY RESPONSE AND ACCORDINGLY, THESE PURCHASES WERE ADD ED BACK TO THE ASSESSEES INCOME U/S 69C. THE DEPRECATION OF RS.0.10 LACS CLAIMED ON FIXED ASSETS PURCHASED FROM THESE PARTIES WAS ALSO DISALLOWED. 4. THE LD. CIT(A) NOTED THAT THE ASSESSEE HAD FILED COPIES OF PURCHASE INVOICES, LEDGER EXTRACTS & BANK ST ATEMENTS EVIDENCING PAYMENT THROUGH BANKING CHANNELS. THEREFORE, THE ADDITION WAS TO BE RESTRICTED TO THE EXTENT OF 12.5%. THE DEPRECIATION DISALLOWANCE OF RS.0.10 LACS WAS DELETED SINCE THE ASSESSEE HAD FURNISHED ALL THE REQUISITE DETAILS AND DOCUMENTARY EVIDENCES. AGGRIEVED, THE REVENUE IS IN FURTHER APPEAL BEFORE US. 5. AFTER GOING THROUGH IMPUGNED ORDER, WE FIND THAT LD. CIT(A) HAS CLINCHED THE ISSUE IN THE RIGHT PERSPECTIVE. THE ASSESSEES TURNOVER WAS NOT UNDER DOUBT AND THERE COULD BE NO SALE WITHOUT ACTUAL PURCHASE OF MATERIAL KEEPING IN VIEW THE NATURE OF ASSESSEES BUSINESS. THE PURCHASES WERE BACKED BY PURCHASE INVOICES, LEDGER EXTRACTS AND BANK STATEMENTS. T HEREFORE, THE ESTIMATION OF 12.5% WAS QUITE FAIR & REASONABLE. THE SEPARATE DISALLOWANCE O F DEPREC I ATION WAS NOT JUSTIFIED 3 SINCE THE ASSESSEE HAD FILED ALL THE REQUISITE DETAILS AND DOCUMENTS. FINDING NO REASON TO INTERFERE IN THE IMPUGNED ORDER, WE DISMISS THE APPEAL. 6. IN THE RESULT, THE APPEAL STANDS DISMISSED. ORDER PRONOUNCED ON 02 ND SEP TEMBER, 2021. SD/ - SD/ - ( C. N. PRASAD ) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 02/09/2021 SR.PS, DHANANJAY / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMB AI.