ITO 25 (2)(1), MUMBAI V. JAI PRAVIN GANDHI, MUMBAI

ITA 1359/MUM/2022

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 9358 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 18-09-2022
• Assessment Year: 2010-2011
• Appeal Filed On: 25-05-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 147; 148; 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, AM ITA No. 1359/MUM/2022 (Assessment Year 2010-11) IT O 25 (2) (1) Room No. 215, 2 nd Floo r, Kautil ya Bha van, B KC, Bandra (E ) Mum bai- 400 051 Vs. Jai Pravin Gandhi 19, Nandanvan, Ansari Road, Vilae Parle (E), Mumbai- 400 056 (Appellant) (Respondent) PAN No. AEQPG3807H Assessee by : None Revenue by : Shri. Ujjawal Chavan. (SR AR) Date of hearing: 19.10.2022. Date of pronouncement : 31.10.2022. O R D E R PER PRASHANT MAHARISHI, AM: 01. This appeal is filed by the Income Tax Officer- 25(2)(1), Mumbai (the learned Assessing Officer) against the order of the National Faceless Appeal Centre (NFAC), Delhi [the learned CIT (A)] for A.Y.2010-11 dated 31 st March, 2022, wherein the appeal filed by the assessee against the assessment order dated 29 th February, 2016 passed under Section 143 read with section 147 of the Income-tax Act, 1961 (the Act), by the Income Tax Officer, making addition of ₹14,25,132/- being 12.5% of non-genuine purchase of ₹1,14,01,054/- was restricted by the learned CIT (A) to 8% following the order of the co-ordinate Bench in assessee’s own case for A.Y. 2009-10. Page | 2 1359/MUM/2022 Jai Pravin Gandhi; A.Y. 2010-11 02. The learned Assessing Officer aggrieved and has raised following grounds of appeal: - “1. Whether, on the facts and in the circumstance of the case and in law, the Learned CIT (A) has erred in restricting the disallowance to 8% of accommodation entries of purchase bills, which according to information received from Sales Tax Department were issued by dealers who are indulging in issuing bogus bills and not disputed by CIT(A), as against addition of 12.5% on total bogus purchase by Assessing Officer without giving any congent reason as to why disallowance of 8% should be done and not 12.5% as done by the Assessing Officer?. 2. Whether, on the facts and circumstances of the case and in law, the learned CIT(A) was correct in holding that estimation of profit of 8% instead of 12.5% of bogus purchases, is fair and justified, and failing to appreciate that the assessee could neither produce documentary evidence nor the books of accounts nor he could produce the alleged parties from whom purchase were claimed to have been made during the year.” 03. The brief fact of the case shows that assessee is an individual , Proprietor of M/s Gandhi Enterprises engaged in the business of trading in Iron and Steel. He filed his return of income on 13 th October 2010, at a total income of ₹3,42,984/-. Subsequently, the information was received from the DGIT Investigation, Mumbai that assessee has booked purchased for an amount of ₹1,14,00,154/- from 9 parties who figured into the list of Page | 3 1359/MUM/2022 Jai Pravin Gandhi; A.Y. 2010-11 hawala traders. The Assessing Officer issued notice under Section 148 of the Act on 6 th February 2015. Subsequently, the notices under Section 133(6) of the Act were issued on 30 th October 2015 to all these parties which were not replied by any of them. None of the parties appeared before the learned Assessing Officer. Accordingly, the assessee was given an opportunity to produce those parties to substantiate the purchases. Assessee failed to do so. Accordingly, the learned Assessing Officer made an addition at the rate of 12.5% of non-genuine purchases of ₹1,14,00,154/- amounting to ₹14,25,132/- by an order dated 29 th February, 2016. 04. The Assessee preferred the appeal before the learned CIT (A). The learned CIT (A) noted that identical issue arose in the case of the assessee for A.Y. 2009-10 wherein as per order dated 11 th October 2018, the ITAT reduced the profit element from 12.5% to 8% and accordingly, following that order the addition was restricted to 8% and assessee was granted relief of ₹5,13,047/-. Now the learned Assessing Officer is aggrieved and is in appeal before us. 05. The learned Departmental Representative supported the order of the learned Assessing Officer. 06. Despite notice none appeared on behalf of the assessee. This is the fourth time that none appeared on behalf of the assessee, therefore, the issue is decided on the merits of the case as per information available on record. 07. We have carefully considered the argument of the learned Departmental Representative and perused the orders of Page | 4 1359/MUM/2022 Jai Pravin Gandhi; A.Y. 2010-11 the lower authorities. We find that identical issue arose in case of assessee for A.Y. 2009-10, wherein the identical addition of ₹12.5% of bogus purchases made by he learned Assessing Officer was restricted to the extent of only 8%. The learned CIT (A) has followed the order of the ITAT in assessee’s own case for A.Y. 2009-10. The learned Departmental Representative could not show us any reason that what error the learned first appellate authority has committed . Accordingly, we confirm the order of the learned CIT (A) and dismiss the appeal of the learned Assessing Officer. 08. In the result, the appeal of the learned Assessing Officer is dismissed. Order pronounced in the open court on 31.10.2022. Sd/- (PRASHANT MAHARISHI) (ACCOUNTANT MEMBER) Mumbai, Dated: 31.10. 2022 Sudip Sarkar, Sr.PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A) 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Mumbai