ITO 14(3)(4), MUMBAI V. SUPER BOND PANEL INDIA P.LTD, MUMBAI

ITA 1445/MUM/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0153 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2017
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 01-03-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ARJU GARODIA
• Assessee Lawyers: SANJUKTA CHOW DHURY
• Keywords: Bogus purchase

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, AM & SHRI SANDEEP GOSAIN , JM ITA NO. 1445 / MUM/20 1 7 ( ASSESSMENT YEAR : 2007 - 08 ) ITO 14(3)(4), 455, AAYAKAR BHAVAN, 4 TH FLOOR, M.K. MARG, MUMBAI 400 020 VS. M/S. SUPER BOND PANEL INDIA PVT. LTD., 17, SUPER HOUSE, AMAR BRASS INDUSTRIAL ESTATE, NEAR RAHEJA CENTRE POINT, KALINA, SANTACRUZ (EAST) MUMBAI 400 098 PAN/GIR NO. AAJCS4468C APPELLANT ) .. RESPONDENT ) REVENUE BY MS. ARJU GARODIA ASSESSE E BY SHRI SANJUKTA CHOWDHURY DATE OF HEARING 23 / 08 /201 7 DATE OF PRONOUNCEME NT 29 / 08 /201 7 / O R D E R PER R.C.SHARMA (A.M) : THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) - 14, MUMBAI DATED 28/12/2016 FOR THE A.Y.2007 - 08 IN THE MATTER OF ORDER PASSED U/S.143(3) R.W.S. 147 OF THE IT ACT. 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. 3. FACTS IN BRIEF ARE THAT ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING IN STEEL PANELS. ON GETTING INFORMATION FROM S ALES TAX DEPARTMENT THAT ASSESSEE HAS MADE PURCHASES FROM BOGUS SUPPLIERS, AO REOPENED THE ASSESSMENT AND MADE ADDITION OF RS.45,36,147/ - U/S.69C. ITA NO. 1445/MUM/2017 M/S. SUPER BOND PANEL INDIA PVT. LTD., 2 4. BY THE IMPUGNED ORDER, CIT(A) DELETED THE ADDITION AFTER HAVING THE FOLLOWING OBSERVATION: - IN THIS CASE, THE ADDITION IS MADE ONLY ON THE BASIS OF A STATEMENT. THE ALLEGED STATEMENT IS ALREADY RETRACTED AS PER SUBMISSION MADE. FURTHER, THE APPELLANT HAS FILED ALL NECESSARY DETAILS IN SUPPORT OF TRANSACTIONS MADE AS DISCUSSED HEREINABOVE WHICH ARE NOT DISPUTED BY THE AO. IT IS ALSO NOT A CASE THAT GROSS PROFIT EARNED ON SUCH TRANSACTIONS IS LESS. BOOKS OF ACCOUNT ARE ALSO ACCEPTED BY THE A.O. EARLIER ASSESSMENT WAS ALSO COMPLETED U/S.143(3) OF THE ACT. THEREFORE, RELYING AND RESPECTFULLY FOLLOWING THE DECISIONS AS ABOVE AND LOOKING INTO THE FACTS OF THE CASE, THE ADDITION MADE BY THE AO IS DELETED. GROUND NOS. 3 & 4 OF APPEAL ARE ALLOWED. 5. REVENUE IS IN FURTHER APPEAL BEFORE US. 6. LEARNED DR RELIED ON THE ORDER OF THE AO AND CONTENDED THAT WITHOUT GIVING COG ENT REASON, CIT(A) DELETED THE ENTIRE ADDITION, ACCORDINGLY, IT WAS SUBMITTED THA T ADDITION OF 12.5% ON SUCH PURCHASES SHOULD BE UPHELD. 7. ON THE OTHER HAND, LEARNED AR RELIED ON THE FINDING SO RECORDED BY CIT(A). 8. WE HAVE CONSIDERED RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM RECORD THAT ADDITION SO MADE BY THE AO ON THE BASIS OF STATEMENT WHICH WAS RETRACTED LATER ON. THE CIT(A) HAS RECORDED A FINDING THAT ASSESSEE HAS FILED FULL DETAILS OF TRANSACTI ONS. THE CIT(A) ALSO OBSERVED THAT GROSS PROFIT EARNED ON SUCH TRANSACTION IS NOT LESS THAN THE NORMAL GROSS PROFIT EARNED IN RESPECT OF OTHER TRANSAC TIONS . HE ALSO OBSERVED THAT AO HAS ACCEPTED THE BOOKS OF ACCOUNTS , AND DELETED THE ENTIRE ADDITION. WE FO UND THAT EVEN THOUGH THE SUPPLIER HAS RETRACTED FROM THE STATEMENT BUT ASSESSEE COULD NOT ITA NO. 1445/MUM/2017 M/S. SUPER BOND PANEL INDIA PVT. LTD., 3 ESTABLISH GENUINENESS OF PURCHASES FROM THE SAME SUPPLIER. EVEN THOUGH CORRESPONDING SALES HAVE NOT BEEN DECLINED, BUT AT THE VERY SAME TIME, IT APPEARS THAT ASSESSEE HAS PURCHASED GOODS FROM OTHERS WHEREIN HE HAD A SAVING OF VAT AND OTHER TAXES. KEEPING IN VIEW TOTALITY OF FACTS AND CIRCUMSTANCES OF THE CASE, WE UPHELD ADDITION OF 2% ON SUCH BOGUS PURCHASES. 9. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED IN PART. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 29 / 08 /2017 S D/ - ( SANDEEP GOSAIN ) S D/ - ( R.C.SHARMA ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED 29 / 08 /201 7 KARUNA S R. PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//