WINSEL AQUAS P.LTD, MUMBAI V. ASST CIT 11(3)(2), MUMBAI

ITA 1205/MUM/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0702 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 20-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T A KHAN
• Keywords: Depreciation; Accommodation entries; Capital expenditure
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH B, MUMBAI BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ITA NO.1205/M/2017 ASSESSMENT YEAR: 2009-10 M/S. WINSEL AQUAS P. LTD., A 52, 1 ST FLOOR, RAJ INDUSTRIAL COMPLEX, MILITARY ROAD, MAROL MAROSHI, ANDHERI EAST, MUMBAI 400 059 PAN: AAACW1266B VS. ITO 11(3)(2), R.NO.429, AAYAKAR BHAVAN, MUMBAI - 400001 (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI RAKESH KAPOOR, A.R REVENUE BY : SHRI T.A. KHAN, D.R DATE OF HEARING : 04.12.2017 DATE OF PRONOUNCEMENT : 12.01.2018 O R D E R PER D.T. GARASIA , JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 10.11.2016 OF THE COMMISSIONER OF I NCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] R ELEVANT TO ASSESSMENT YEAR 2009-10. 2. ASSESSEE IS A REGISTERED COMPANY. THE ASSESSEE COMPANY HAS FILED THE RETURN OF INCOME ON 29.09.09 DECLARING TO TAL INCOME AT RS.59,10,967/-. IN THE ASSESSMENT PROCEEDINGS PASS ED UNDER SECTION ITA NO.1205/M/2017 M/S. WINSEL AQUAS P. LTD. 2 143 READ WITH SECTION 147 THE ASSESSING OFFICER (HE REINAFTER REFERRED TO AS THE AO) HAS MADE THE ADDITION ON ACCOUNT OF D ISALLOWANCE OF DEPRECIATION OF RS.1,80,785/-. THE AO HAS DISALLOW ED DEPRECIATION ON THE GROUND THAT AO HAS NOTICED THAT SALES TAX DE PARTMENT OF GOVERNMENT OF MAHARASHTRA HAS LISTED NAMES OF CERTA IN DEALERS WHO ARE PROVIDING ACCOMMODATION ENTRIES WITHOUT DOING A CTUAL BUSINESS. THE AO NOTICED THAT ASSESSEE HAS MADE ABOVE PURCHAS E FROM THREE PARTIES NAMELY MOTION TRADERS PVT. LTD., SHREE TRAD ING CORPORATION & K.K. TRADING COMPANY WHO WERE PROVIDING THE BOGUS BILLS. THEREFORE, AO DISALLOWED THE DEPRECIATION. 3. MATTER CARRIED TO THE LD. CIT(A) AND THE LD. CIT (A) HAS ALSO DISMISSED THE APPEAL BY ESTIMATING THE SUPPRESSED P ROFIT TO THE EXTENT OF 12.5% OF THE PURCHASES MADE FROM THE BOGUS ENTIT IES. 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE P ARTIES. DURING THE COURSE OF HEARING, THE LD. A.R. SUBMITTED THAT ASSESSEE HAS PURCHASED AIR CONDITIONER, SYNTHETIC WAIVER TANK AN D POLY CARBONATE JARS FROM THESE ABOVE THREE COMPANIES AND ASSESSEE HAS CLAIMED DEPRECIATION WHICH WAS DISALLOWED. THE LD. A.R. SU BMITTED THAT THERE IS NO QUESTION OF DISALLOWING 12.5%, BECAUSE EVERY EXPENDITURE IS SHOWN AS CAPITAL EXPENDITURE. THEREFORE, MATTER MAY BE RESTORED TO AO TO DECIDE IT AFRESH. 5. LD. D.R. DID NOT OBJECT. ITA NO.1205/M/2017 M/S. WINSEL AQUAS P. LTD. 3 6. HAVING HEARD BOTH THE PARTIES AND LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT ASSESSEE HA S MADE PURCHASES FROM ABOVE THREE PARTIES. THEREFORE, WE ARE OF THE VIEW THAT IT REQUIRES VERIFICATION AT THE END OF AO. AO IS DIRE CTED TO VERIFY AND ALLOW THE CLAIM OF DEPRECIATION AS PER LAW. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 12.01.2018. SD/- SD/- (G. MANJUNATHA) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 12.01.2018. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.