Chetas Control Systems Pvt. Ltd., Pune V. Deputy Commissioner of Income-tax,

ITA 1241/PUN/2016

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3101 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 8 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-03-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 05-03-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 07-06-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: S D PATHAK
• Keywords: Bogus purchase; Revised return; Set aside
• Section: 271(1)(c); 133A; 133(6); 143(1); 148

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 NOS. 1241 TO 1246/PUN/2016 / ASSESSMENT YEARS : 2009-10 TO 2011-12 CHETAS CONTROL SYSTEMS PVT. LTD. PLOT NO.1, S. NO.8 + 9, CHETAS HOUSE, SIDHTEK HSG. SOCIETY, SUTARWADI, PASHAN, PUNE-411 041 PAN : AAACC7437N ....... / APPELLANT / V/S. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1(1), PUNE. / RESPONDENT ASSESSEE BY : SHRI S.D. PATHAK REVENUE BY : SHRI PANKAJ GARG / DATE OF HEARING : 05.03.2019 / DATE OF PRONOUNCEMENT : 06.03.2019 / ORDER PER BENCH : THESE BUNCH OF SIX APPEALS PREFERRED BY THE ASSESSEE EMANATES FROM THE ORDER OF LD. CIT(APPEALS)-1, PUNE COMMONLY DATED 17.0 3.2016 FOR THE ASSESSMENT YEARS 2009-10 TO 2011-12 AS PER GROUNDS OF APPEAL O N RECORDS. ALL THESE APPEALS WERE HEARD TOGETHER. SINCE THE FACTS ARE COMMON, ISSUES ARE SIMILAR, THESE CASES ARE BEING DISPOSED OF VIDE T HIS CONSOLIDATED ORDER. 2 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 2. THESE CASES RELATES TO HAWALA PURCHASES WHEREIN THE ASSESSING OFFICER MADE 100% ADDITION ON SUCH PURCHASES AND THE LD. CIT(A) HAS CONFIRMED THE SAME. FOR SAKE OF CONVENIENCE, WE WOULD TAKE FACTS AS A PPEARING IN ASSESSMENT YEAR 2009-10. ITA NO.1241/PUN/2016 A.Y.2009-10 3. THE FACTS IN THIS CASE ARE THAT THE ASSESSEE COMPAN Y IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND INSTALLATION ENGINEERING GOODS AND FILED ITS RETURN OF INCOME FOR A.Y. 2009-10 ON 16/9/2009 DECLARING TOTAL INCOME OF RS.3,04,92,010/-. THE RETURN WAS ASSESSED U/S 143(1) OF IN COME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) ACCEPTING RE TURNED INCOME. THEREAFTER, INFORMATION WAS RECEIVED FROM THE MAHARASHTRA SALES TAX DEPARTMENT WHICH HAD CONDUCTED ENQUIRIES IN THE CASES O F SEVERAL DEALERS LOCATED ALL ACROSS MAHARASHTRA RESULTING INTO UNEARTHING O F A RACKET INVOLVING MORE THAN 1935 HAWALA DEALERS AND MORE THAN 33,700 BEN EFICIARIES. 'HAWALA' ENTAILS MAKING BOGUS INVOICES TO ALLOW A TRADER TO CLAIM TAX CREDITS. IN THIS RACKET, THE HAWALA OPERATOR POSING AS THE 'SELLER' EXIST S ONLY ON PAPER, ISSUES FAKE BILLS TO THE CONCERN AND GETS COMMISSION IN RETURN. TH E BENEFICIARY, IN TURN, GETS THE INPUT TAX CREDIT ON THE MATERIAL HE HAD N EVER PURCHASED IN REALITY. IT HAS BEEN IDENTIFIED BY THE SALES TAX DEPARTMENT THAT THERE ARE MORE THAN 37,700 SUCH BENEFICIARIES WHO HAD USED FAKE INVO ICES TO FRAUDULENTLY CLAIM TAX DEDUCTION ON SUCH PURCHASES. THE LIS T OF BENEFICIARIES CONTAIN THE TOTAL AMOUNT OF HAWALA AVAILED BY THE BENEFICIA RY FOR RESPECTIVE FINANCIAL YEARS. THE INFORMATION RECEIVED FROM SALES TAX DEPA RTMENT WAS DULY EXAMINED AND VERIFIED FROM RECORD AND DETAIL OF SUPPLIE RS AND THEIR STATEMENTS WERE EXAMINED AND IT WAS REVEALED THAT THE ASSESSEE HAD CLAIMED PURCHASES OF RS.3,51,57,380/- EXCLUDING VAT FOR FINANCIAL YEA R 2008-09 RELEVANT TO A.Y.2009-10 IN THEIR BOOKS WHEREAS NO MATER IAL AS AGAINST THESE 3 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 PURCHASES WERE RECEIVED BY IT IN ACTUAL. THE VERIFICATION R EVEALED THAT THE ASSESSEE HAS INFLATED ITS EXPENSES TO THE EXTENT OF THE BILLS ISSUED FROM HAWALA DEALERS. THEREFORE, NOTICE U/S 148 WAS ISSUED TO TH E ASSESSEE ON 28/3/2013 AND WAS SERVED ON IT. THE AO HAS RECORDED R EASONS TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT BEFORE ISSUE OF NOTICE U/S.148 OF THE A CT. 4. CONSIDERING THE QUANTUM OF BOGUS PURCHASES AND CIRCU MSTANCES OF THE CASE, SURVEY UNDER SECTION 133A OF THE ACT WAS CONDUCT ED IN THE BUSINESS PREMISES OF ASSESSEE ON 13/08/2013 TO 14/08/2013. DURIN G THE COURSE OF SURVEY, STATEMENT ON OATH OF MR. MAHESH S. DESHMUKH, DIRE CTOR OF ASSESSEE COMPANY WAS RECORDED AND DURING THE COURSE OF STATEMENT, HE ACCEPTED FOLLOWING PURCHASES AS BOGUS PURCHASES AND OFFER ED THE SAME FOR TAXATION IN RESPECTIVE ASSESSMENT YEARS AS ON RECOR D. THE ASSESSEE, ACCORDINGLY, FILED REVISED RETURN OF INCOME IN WHICH ADDITIONAL INCOME OF RS.3,40,06,190/- ACCEPTED DURING THE COURSE OF SURVEY, WAS OFFERED TO TAX. THE ASSESSMENT WAS COMPLETED AT TOTAL INCOME OF RS.6,47,61 ,890/- AND SINCE ADDITIONAL INCOME REPRESENTING BOGUS PURCHASES AMOUNTING TO RS.3,40,06,190/- WAS OFFERED IN THE RETURN OF INCOME FILED IN RE SPONSE TO NOTICE U/S.148 OF THE ACT AFTER DETECTION AND SURVEY AC TION TAKEN BY THE DEPARTMENT AND THEREAFTER, PENALTY PROCEEDINGS WERE INITIA TED BY THE ASSESSING OFFICER U/S.271(1)(C) OF THE ACT AS WELL. 5. AT THE TIME OF HEARING, THE LD. AR OF THE ASSESSEE VE HEMENTLY ARGUED THAT THESE ARE NOT BOGUS PURCHASES AND IN FACT, PURCHA SES WERE MADE AGAINST WHICH PAYMENTS HAVE BEEN MADE TO THE CONCERNED PARTIE S. ALL THE PAYMENTS HAVE BEEN MADE THROUGH BANKING CHANNELS AND BANK STAT EMENTS HAVE BEEN FILED BEFORE THE REVENUE AUTHORITIES. THE LD. AR FURTHER SUB MITTED THAT WHEN SURVEY ACTION TOOK PLACE, THE DOCUMENTARY EVIDENCES SUC H AS STOCK REGISTER, SALES REGISTER WERE MAINTAINED AND KEPT AT THE SITE SINCE THEY ARE REQUIRED FOR 4 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 AUDIT. THE SURVEY TEAM COULD HAVE VISITED THE SITE AND CO ULD HAVE EXAMINED THE GENUINENESS OF THE PURCHASES THROUGH SCRUTINY OF TH ESE DOCUMENTS WHICH THEY HAVE NOT DONE. THE LD. AR FURTHER DEMONSTRATED THAT THERE HAS BEEN MOVEMENT OF GOODS AND INVITED OUR ATTENTION TO PAPER BO OK, A-2 AT PAGE 28 WHERE BILLS OF THE TRANSPORTER IS ATTACHED. HOWEVER, BILLS D O NOT DEPICT ANY AMOUNT. SINCE THAT BILL HAS TO BE RAISED AT PUNE DURING R ELEVANT PERIOD. THE LD. AR ALSO SUBMITTED THAT THEY HAVE ACCEPTED BOGUS PU RCHASES MADE AT THE TIME OF SURVEY AND HAVE OFFERED ADDITIONAL INCOME TO TAX IN THE REVISED RETURN FILED, IT IS ON ACCOUNT OF STRESS AND DURESS IMPOSED UPON THEM BY THE REVENUE AUTHORITIES. THEY HAVE MADE REITERATION BEFORE T HE LD. CIT(A) THROUGH AN AFFIDAVIT FILED WHICH IS ALSO PLACED BEFORE US IN THE PAPER BOOK. 6. PER CONTRA, THE LD. DR CONTENDED THAT ON GOING THR OUGH THE STATEMENT RECORDED U/S.133A OF THE ACT, STATEMENT HAS BEEN TAKEN ON OATH FROM THE ASSESSEE AND AT THE VERIFICATION PART; HE HAS CATEGORICA LLY STATED THAT EVERY STATEMENT HAS BEEN MADE IN A SOUND STATE OF MIND AND W ITHOUT UNDUE PRESSURE, COERCION OR DURESS. THAT EVEN THE CA OF THE ASSESSEE HAS SIGNED VERIFICATION ALONG WITH THE ASSESSEE AND THE STATEMENT WA S RECORDED ONLY AS PER PROCEDURE LAID DOWN IN THE ACT. THE LD. AR HAS STAT ED THAT UNDUE PRESSURE OR INFLUENCE HAS BEEN EXERCISED FOR MAKING SUCH STATEMENTS. HOWEVER, HE IS UNABLE TO DEMONSTRATE, AS TO HOW THE STA TEMENTS WERE RECORDED IN A MANNER NOT PRESCRIBED WITHIN THE AMBIT OF T HE ACT. THAT IN ABSENCE OF SUCH EVIDENCES, PER CONTRA, AS SHOWN IN THE RECORDS, STATEMENTS HAS BEEN MADE U/S.133A OF THE ACT BY THE ASSESSEE REG ARDING BOGUS PURCHASES AND REVISED RETURN OFFERING ADDITIONAL INCOME FOR TAX IS ALSO FILED. THEREFORE, THE LD. DR PLACED STRONG RELIANCE ON THE ORDER S OF SUB-ORDINATE AUTHORITIES. 5 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 7. WE HAVE PERUSED THE CASE RECORDS AND HEARD THE R IVAL CONTENTIONS AND EVIDENCES BROUGHT OUT ON RECORDS CLEARLY SUGGEST THAT THE MAHARASHTRA SALES TAX DEPARTMENT HAD PROVIDED INFORMATION REGARDING BOGUS TRANSACTIONS/PURCHASES BEING CONDUCTED THROUGHOUT THE STATE OF MAHARASHTRA AND THERE ARE UMPTEEN NUMBER OF BENEFICIARIE S WITH REGARD TO THESE BOGUS PURCHASES. IN THE CASE OF THE ASSESSEE, FIRS T A NOTICE U/S.148 OF THE ACT WAS ISSUED ON 28.03.2013. THEREAFTER, SURVEY TOOK PLACE ON 14.08.2013. DURING SURVEY, OATH WAS ADMINISTERED TO THE AS SESSEE AND STATEMENT WAS RECORDED U/S.133A OF THE ACT WHEREIN THE ASSESSEE HAS ACCEPTED MAKING VARIOUS BOGUS PURCHASES AT THE DIFFERENT ASSESSMENT YEARS AS ON RECORD AND OFFERED SAME FOR TAXATION. ACCORDINGLY, A SSESSEE FILED REVISED RETURN OF INCOME ON 27.09.2013 IN WHICH HE HAS SHOWN ADDIT IONAL INCOME OF RS.3,40,06,190/- AND OFFERED THE SAME FOR TAXATION. HOWEV ER, BEFORE US, THE LD. AR SHOWED THE COPY OF AFFIDAVIT AND STATEMENT OF FACTS BEFORE THE LD. CIT(A) WHEREIN THEY HAVE REITERATED THE STATEMENT MADE DURING THE COURSE OF SURVEY ON THE GROUND THAT THOSE WERE NOT VOLUNTARILY MADE. RATHER, THEY HAVE MADE THOSE STATEMENTS IN COMPULSION AND PRESSURE FROM D EPARTMENT. HOWEVER, WE DO NOT FIND ANY EVIDENCE PLACED ON RECORD TO SUGGEST THIS FACT. THAT EVEN, THE MOVEMENT OF GOODS WAS NOT DEMONSTRATED BY THE ASSESSEE CONCLUSIVELY. THERE ARE NO EVIDENCES LIKE GOVERNMENT REC ORDS, PAYMENT OF OCTROI DUTY RECEIPTS, ROAD CHALLANS OR DOCUMENTS WITH STA MP BY GOVT. AUTHORITY. NOTHING HAS BEEN PLACED ON RECORD REGARDING M OVEMENT OF GOODS PURCHASED. THEREFORE, IT IS CLEAR THAT BOGUS PURCHASES WE RE MADE. WE FIND THAT BEING SIMILAR SITUATION IN THE CASE OF M/S. CHHABI ELEC TRICALS PVT. LTD. VS. DCIT IN ITA NO. 795/PUN/2014 FOR THE ASSESSMENT YEA R 2010-11, WHEREIN ON THE SAME FACTS AND CIRCUMSTANCES, WE HAVE OBSERVED TH AT : 40. IN VIEW OF THE ABOVE SAID RATIOS, THE PRESENT ISSUE OF BOGUS PURCHASES IS TO BE DECIDED ON THE BASIS OF FACTS OF EACH CASE. THE FIRST ASPECT IS THE INFORMATION RECEIVED BY THE ASSESSING OFFICER FROM THE SALES TAX DEPARTMENT IN RESPECT OF ALLEGED HAWALA DEALERS . IN MANY CASES, THE 6 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 ASSESSING OFFICER HAS NOT EVEN RECEIVED THE COPY OF STATEMENT RECORDED OR ANY OTHER EVIDENCE FROM THE SALES TAX DEPARTMENT , EXCEPT THE LIST OF HAWALA DEALERS AND ON THE BASIS OF THE SAID LIST, T HE ASSESSMENT PROCEEDINGS HAVE BEEN COMPLETED IN THE HANDS OF ASS ESSEE, WHO HAD MADE THE PURCHASES FROM THE SAID PARTIES. IN CASE, NO SUCH EVIDENCE HAS BEEN RECEIVED BY THE ASSESSING OFFICER BEFORE MAKIN G ADDITION, THEN THERE IS NO WARRANT IN MAKING AFORESAID ADDITION IN THE HANDS OF ASSESSEE MERELY ON THE BASIS OF SO CALLED LIST OF H AWALA DEALERS. THERE ARE OTHER CASES, WHERE THE ASSESSING OFFICER HAD RE CEIVED THE STATEMENT OF THE PERSONS WHO WERE HAWALA DEALERS AND WHO HAD ADMITTED TO HAVE JUST ISSUED BILLS OF SALE WITHOUT DELIVERY OF GOODS . IN SUCH CIRCUMSTANCES, THERE IS EVIDENCE AGAINST THE RESPECTIVE ASSESSEE T HAT WHERE THE SELLER OF THE GOODS, HAS ADMITTED NOT TO HAVE ENTERED INTO RE AL TRANSACTION OF SALE OF GOODS. AGAINST SUCH NON-TRANSACTION, THERE CAN B E NO DELIVERY OF GOODS, THEN IT IS CASE OF PASSING OF BILLS OF SALE AND PURCHASES, AGAINST WHICH NO VAT HAS BEEN PAID. SUCH BOGUS PURCHASES AR E THEN TO BE ADDED IN THE HANDS OF ASSESSEE. WHERE THE ASSESSING OFFICER HAD CONFRONTED THE ASSESSEE WITH THE INFORMATION RECEIV ED, SUPPLIED COPIES OF STATEMENTS AND WHERE THE PERSONS HAVE NOT BEEN TRAC ED AND NO CONFIRMATION HAS BEEN FILED BY THE ASSESSEE IN THIS REGARD, THEN THE ADDITION IS TO BE MADE IN THE HANDS OF ASSESSEE ON ACCOUNT OF SUCH BOGUS PURCHASES. IN THE FACTS AND CIRCUMSTANCES OF SOME CASES, THE GOODS HAVE BEEN TRANSFERRED BY SUCH HAWALA DEALERS TO THE RESPECTIVE PURCHASERS, AGAINST WHICH THE ASSESSEE HAS TO DISCH ARGE ONUS OF ESTABLISHING THE TRAIL OF GOODS WHICH ARE TRANSFERR ED AND FURTHER SOLD BY THEM. WHERE THE ASSESSEE IS ABLE TO PRODUCE EVIDENC E OF PURCHASE OF GOODS BY WAY OF WEIGHMENT BRIDGE RECEIPTS, TRANSPOR TATION DOCUMENTS, PAYMENT OF OCTROI AND SUBSEQUENT SALE OF GOODS TO T HE RESPECTIVE PARTIES AND / OR WHERE THE ASSESSEE HAS MAINTAINED COMPLETE QUANTITATIVE DETAILS OF PURCHASE AND SALE OF GOODS, THEN TOTAL B OGUS PURCHASES CANNOT BE ADDED IN THE HANDS OF ASSESSEE, BUT GP RATE OF 1 0% IS TO BE APPLIED ON BOGUS PURCHASES. WHERE THE ASSESSEE DOES NOT EST ABLISH ITS CASE, THEN THE COMPLETE BOGUS PURCHASES ARE TO BE ADDED A S HAWALA PURCHASES. FURTHER, IN CASES, WHERE THE STATEMENTS ARE RECORDED AND COPIES OF WHICH HAVE BEEN SUPPLIED TO THE ASSESSEE AND ASSESSEE ESTABLISHED THE CASE OF RECEIPT OF GOODS AND ITS ON WARD TRANSMISSION BY WAY OF SALE BILLS, THEN THE FACTUM OF PURCHASES BY THE ASSESSEE STANDS ESTABLISHED IN SUCH CIRCUMSTANCES. HOWEVER, THE BEN EFIT OF PURCHASES BEING MADE FROM GREY MARKET, NEEDS ESTIMATION IN TH E HANDS OF ASSESSEE. THE TRIBUNAL HAS ALREADY HELD THAT THE AD DITION BE MADE BY ESTIMATING THE SAME @ 10% OF THE ALLEGED HAWALA PUR CHASES. ACCORDINGLY, IT IS SO HELD. IN VIEW THEREOF, THE IS SUES WHICH EMERGE ARE AS UNDER:- I. IN CASE NO INFORMATION IS RECEIVED BY THE ASSESS ING OFFICER FROM THE SALE TAX DEPARTMENT AND NO COPY OF STATEMENT RECORD ED OR ANY OTHER EVIDENCE IS RECEIVED FROM THE SALES TAX DEPARTMENT, THEN NO ADDITION IS TO BE MADE ON THE BASIS OF NAME OF HAWALA DEALER IN THE LIST PREPARED BY THE SALES TAX DEPARTMENT, WHERE THE ASSESSEE HAD AS KED FOR THE SAID INFORMATION DURING ASSESSMENT PROCEEDINGS. II. WHERE THE ASSESSING OFFICER HAD RECEIVED THE ST ATEMENTS OF PERSONS WHO HAD ADMITTED TO HAVE JUST ISSUED BILLS OF SALE WITHOUT ANY DELIVERY OF GOODS. IN VIEW OF SUCH EVIDENCE, WHERE THE ASSES SEE HAD NOT ENTERED INTO REAL TRANSACTION OF PURCHASE OF GOODS AND IN T HE ABSENCE OF ANY DELIVERY OF GOODS, THE SALES ARE BOGUS AND THE ENTI RE SALES ARE TO BE ADDED IN THE HANDS OF ASSESSEE. ADMITTEDLY, THE DEA LER HAD NOT EVEN PAID VAT AGAINST SUCH PASSING OF GOODS. III. THE CASE WHERE THE ASSESSING OFFICER HAD CONFR ONTED THE INFORMATION RECEIVED FROM THE SALES TAX DEPARTMENT AND HAD SUPP LIED COPIES OF STATEMENTS RECORDED AND HAD ALSO ISSUED NOTICE UNDE R SECTION 133(6) OF 7 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 THE ACT, WHERE HAWALA DEALER WAS NOT TRACEABLE AND IN THE ABSENCE OF THE ASSESSEE FAILING TO FILE ANY DOCUMENTARY EVIDEN CE OF DELIVERY OF GOODS, ADDITION IS TO BE UPHELD IN THE HANDS OF ASS ESSEE ON ACCOUNT OF SUCH BOGUS PURCHASES. IV. THE NEXT INSTANCE IS THE CASE OF GOODS WHICH HA VE BEEN ADMITTEDLY SOLD BY THE HAWALA DEALER AND HAS BEEN RECEIVED BY THE ASSESSEE, WHO IN TURN HAD MAINTAINED QUANTITATIVE DETAILS AND ALS O EVIDENCE OF ITS MOVEMENT I.E. TRANSPORTATION DETAILS AND QUALITY CO NTROL DETAILS OF CONSUMPTION OF THE SAID MATERIAL OR EXACT DETAILS O F SALE OF THE SAME CONSIGNMENT THROUGH SAME TRANSPORTER DIRECTLY TO TH E PARTY, THEN THE TOTAL PURCHASES CANNOT BE ADDED IN THE HANDS OF ASSESSEE. HOWEVER, SINCE THE PURCHASES ARE MADE FROM THE GREY MARKET, SOME E STIMATION NEEDS TO BE MADE IN THE HANDS OF ASSESSEE. THE TRIBUNAL IN M /S. CHETAN ENTERPRISES VS. ACIT (SUPRA) HAS ALREADY HELD THAT THE ADDITION BE MADE BY ESTIMATING THE SAME @ 10% OF THE ALLEGED HAWALA PURCHASES, OVER AND ABOVE THE GP SHOWN BY THE RESPECTIVE ASSESSEE. V. ANOTHER SET OF CASES WHERE THE STATEMENTS RECORD ED BY THE SALES TAX DEPARTMENT HAVE BEEN HANDED OVER TO THE ASSESSEE AN D THE COPIES OF SAME HAVE BEEN SUPPLIED TO THE ASSESSEE, THEN WHERE THE ASSESSEE ESTABLISHED THE CASE OF RECEIPT OF GOODS AND ITS ON WARD TRANSMISSION, THEN THE FACTUM OF PURCHASES BY THE ASSESSEE STANDS ESTABLISHED IN SUCH CIRCUMSTANCES. HOWEVER, ESTIMATION IS TO BE MADE IN THE HANDS OF ASSESSEE BECAUSE OF PURCHASES FROM THE GREY MARKET AND FOLLOWING THE ABOVE SAID RATIO, ADDITION IS TO BE MADE BY ESTIMAT ING THE SAME @ 10% OF THE ALLEGED HAWALA PURCHASES, OVER AND ABOVE THE NE T PROFIT SHOWN BY THE ASSESSEE. WE, THEREFORE, RESPECTFULLY, FOLLOWING OUR ABOVE STATED DECIS ION AND APPRECIATING THE SIMILAR SET OF FACTS AND CIRCUMSTANCES IN T HE PRESENT CASE OF THE ASSESSEE, WE HOLD ADDITION @10% OF THE ALLEGED HAWALA PURCHASES, OVER AND ABOVE THE GP SHOWN BY THE ASSESSEE FOR THE YEAR. WE THEREFORE, SET ASIDE THE ORDER OF LD. CIT(A) AND HOLD AS AFORESAID. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO.1241/P UN/2016 FOR ASSESSMENT YEAR 2009-10 IS PARTLY ALLOWED. 9. IN OTHER APPEALS FILED BY THE ASSESSEE IN ITA NOS.1242 & 1243/PUN/2016, THE FACTS AND CIRCUMSTANCES OF THE CASE ARE IDENTICAL EXCEPT THE AMOUNTS. SINCE ALL OTHER FACTS, ARGUMENTS OF THE PARTIE S ARE SAME AND SIMILAR, THE SAME RULING AS IN ITA NO.1241/PUN/2016 SHALL AP PLY MUTATIS- MUTANDIS TO OTHER SAID APPEALS HEREIN ALSO. THEREFORE, FOR THESE C ASES ALSO, WE 8 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 SET ASIDE THE ORDER OF THE LD. CIT(APPEALS) AND PARTLY ALLO W THE APPEALS OF THE ASSESSEE. 10. IN THE RESULT, APPEALS OF THE ASSESSEE IN ITA NO.1241 TO 1243/PUN/2016 FOR THE ASSESSMENT YEARS 2009-10 TO 20 11-12 ARE PARTLY ALLOWED. ITA NO. 1244/PUN/2016 A.Y. 2009-10 11. THE APPEAL FILED BY ASSESSEE IN ITA NOS.1244/PUN/201 6 PERTAINS TO LEVY OF PENALTY U/S.271(1)(C) OF THE ACT. 12. WITH REGARD TO THE PENALTY BEING IMPOSED U/S.271(1)(C) OF THE ACT, IT IS THE GROUND OF THE REVENUE THAT IT IS ONLY AFTER THE DE TECTION OF BOGUS PURCHASES AND SURVEY ACTION, THE ASSESSEE OFFERED ADDITIO NAL INCOME TO TAX WHICH OTHERWISE, HE WOULD HAVE CONCEALED. 13. THE LD. AR ON THE OTHER HAND, SUBMITTED THAT THOUG H THEY HAVE REITERATED THE STATEMENT ON THE BOGUS PURCHASES BUT IMMEDIATELY AFTER ADMISSION ON OATH AND ACCEPTING ADDITIONAL INCOME, THEY HAV E FILED REVISED RETURN OF INCOME OFFERING FOR TAXATION. THEREFORE, THEY DO N OT HAVE MENS RIA OR ILL MOTIVE TO DEFRAUD REVENUE. RATHER, THE ASSESSEE AL WAYS CO-OPERATED WITH THE REVENUE AND BY FILING REVISED RETURN THERE IS NO CONCEALMENT OF INCOME NEITHER FURNISHING OF INACCURATE PARTICULARS OF INCOME. 14. WE HAVE PERUSED THE CASE RECORDS AND HEARD THE R IVAL CONTENTIONS ON THE ISSUE. WE HAVE GIVEN CONSIDERABLE THOUGHT TO THE ISSU E OF PENALTY BEING IMPOSED U/S. 271(1)(C) OF THE ACT AND HAVE TAKEN GUIDANCE O F THE HON'BLE APEX COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. REPORTED AT 322 ITR 158 (SC). 9 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 IT IS NOT THAT IN ALL FACTS AND CIRCUMSTANCES, PENALTY CA N BE LEVIED. THAT FROM THE CIRCUMSTANCES OF THE CASE THERE HAS TO BE DER IVED ELEMENTS OF MENS RIA AND ACTUS RIUS FROM THE CONDUCT OF THE ASSESSEE TO ASCERTAIN WHETHE R HE WANTED TO CONCEAL INCOME OR FURNISH INACCURATE PARTICULAR S OF INCOME SO TO EVADE TAX. IN THE INSTANT CASE, ASSESSING OFFICER HAS NOT BROUGHT OUT ANY COGENT SPECIFIC REASON FOR IMPOSING PENALTY. THE REASON OF THE ASSESSING OFFICER IS ON ASSUMPTION. PENALTY U/S.271(1)(C) CANNOT BE LEVIED ON ASSUMPTION. THERE HAS TO BE SOMETHING MORE WHICH CAN JU STIFY SUCH LEVY OF PENALTY. HERE, WE HAVE ALREADY DECIDED THAT THERE WERE B OGUS PURCHASES AND RELYING ON OUR DECISION IN THE CASE OF M/S. CHHABI ELECTR ICALS PVT. LTD. (SUPRA), WE HAVE ARRIVED AT FINDINGS THAT ADDITION @10% OF T HE ALLEGED HAWALA PURCHASES, OVER AND ABOVE THE GP SHOWN BY THE ASSESS EE SHOULD BE DONE BY THE ASSESSING OFFICER. THAT FURTHER, ANY PENAL ACTION IS NOT WARRANTED IN THE CASE OF ASSESSEE. THE HON'BLE APEX COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD (SUPRA.) HAS HELD THAT ALL OMISSIONS CANNOT WARRANTY THE LEVY OF PENALTY U/S.271(1)(C) OF THE ACT. IN THE INSTANT C ASE, THE ASSESSEE FIELD REVISED RETURN OFFERING THE ADDITIONAL INCOME TO TAX IMME DIATELY AFTER THE STATEMENT ON OATH AND HAS NOT WAITED TILL THE COMPLETION OF PROCEEDINGS OR OTHERWISE. 15. TAKING INTO ENTIRETY THE FACTS AND CIRCUMSTANCES OF TH E CASE, PENALTY LEVIED U/S.271(1)(C) IS NOT JUSTIFIED IN THE CASE OF THE ASSESSEE. ACCORDIN GLY, WE DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY IMPOSED ON THE AS SESSEE. 16. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO.1244/ PUN/2016 FOR THE ASSESSMENT YEAR 2009-10 IS ALLOWED. 10 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 17. IN OTHER APPEALS FILED BY THE ASSESSEE REGARDING PEN ALTY IN ITA NOS.1245 & 1246/PUN/2016, THE FACTS AND CIRCUMSTANCES O F THE CASE ARE IDENTICAL EXCEPT THE AMOUNTS. SINCE ALL OTHER FACTS, ARGUMEN TS OF THE PARTIES ARE SAME AND SIMILAR, THE SAME RULING AS IN ITA NO.1244/PU N/2016 SHALL APPLY MUTATIS-MUTANDIS TO OTHER SAID APPEALS HEREIN ALSO. THEREFORE, FOR THESE CASES ALSO, WE DIRECT THE ASSESSING OFFICER TO DELETE THE P ENALTY IMPOSED ON THE ASSESSEE. 18. IN THE COMBINED RESULT, APPEALS OF THE ASSESSEE IN IT A NOS. 1241 TO 1243/PUN/2016 FOR THE ASSESSMENT YEARS 2009-10 TO 20 11-12 ARE PARTLY ALLOWED AND APPEALS OF THE ASSESSEE IN ITA NOS. 1244 TO 1 246/PUN/2016 FOR THE ASSESSMENT YEAR 2009-10 TO 2011-12 ARE ALLOWED. ORDER PRONOUNCED ON 06 TH DAY OF MARCH, 2019. SD/- SD/- R.S.SYAL PA RTHA SARATHI CHAUDHURY VICE PRESIDENT JUDICIAL MEMBER / PUNE; / DATED : 06 TH MARCH, 2019. SB !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(APPEALS)-1, PUNE. 4. THE CIT-1, PUNE. 5. '#$ %%&' , ( &' , )*+ , / DR, ITAT, B BENCH, PUNE. 6. $,- ./ / GUARD FILE. // TRUE COPY // (0 / BY ORDER, %1 &+ / PRIVATE SECRETARY ( &' , / ITAT, PUNE. 11 ITA NOS.1241 TO 1246/PUN/2016 A.YS.2009-10 TO 2011-12 DATE 1 DRAFT DICTATED ON 05 .03 .2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 06 .03 .201 9 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