Ace Brain Systems And Software Pvt.Ltd, Pune V. Deputy Commissioner of Income-tax, Circle - 1 (1), Pune

ITA 1594/PUN/2019

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 1467 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 13-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASSESSEES FIRST SUBSTANTIVE GROUND

Judgement Text

आयकर अपीऱीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI S.S.GODARA, JM AND SHRI DR. DIPAK P. RIPOTE, AM आयकर अपीऱ सं. / ITA No.1594/PUN/2019 ननधधारण वषा / Assessment Year : 2012-13 Ace Brain Systems & Software P.Ltd., 1559, Sadashiv Peth, Opp. Shreyas Hotel, Pune – 411 030. PAN : AADCA7232L .......अपऩलधथी / Appellant बनधम / V/s. Dy.CIT. Circle 1(1) Pune ......प्रत्यथी / Respondent Assessee by : Shri Sharad Vaze Revenue by : Shri Arvind Desai सपनवधई की तधरऩख / Date of Hearing : 22.06.2022 घोषणध की तधरऩख / Date of Pronouncement : 29.08.2022 आदेश / ORDER PER S. S. GODARA, JM : 1. This assessee’s appeal for A.Y. 2012-13 arises against the CIT(A), Pune’s order dated 28/02/2017 passed in ITBA/APL/S/250/2016- 17/1002101976(1), involving proceeding u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961; in short "the Act”. Heard both the parties. Case file perused. 2 ITA No.1594/PUN/2019 A.Y. : 2012-13 Ace Brain Systems & Software P.Ltd., 2. It emerges at the outset that the assessee’s instant appeals suffers from 857 days delay in filing stated to be attributable to various corporate issue amongst its directors as well as lack of communication. Hon’ble apex court’s landmark decision in Collector Land Acquisition V/s. Mst. Katiji & Others (1987) 167 ITR 471 (SC) has settled the law long back that all such technical aspects must make way for the cause of substantial justice. This is indeed coupled with the fact that the Revenue has also not rebutted the assessee’s forgoing condonation averments. We thus condone the impugned delay. 3. Coming to merits, we note that the assessee’s sole substantive grievance challenges correctness of the both the learned authorities disallowing its purchases amount Rs.65,61,713/- sourced from M/s Dev Enterprises as bogus. The CIT(A) lower appellate discussion in para 8 treats the same as an accommodation entry as follows :- “8. As far as purchases of M/s. Dev Enterprises are concerned, it is seen that the appellant has faiIed to produce the party despite opportunity provided in this regard several times. Further discrepancies in the Bills and nature of work claimed to have been carried out, undue delay in payment that too only partial and credit of cheques in other account not belonging to the appellant, discrepancy in TIN Number and closure of Bank accounts after withdrawal of cash sufficiently proves that claim of purchase of Rs.65,61,713/- from M/s Dev Enterprises was nothing but accommodation entry which has been proved by detailed enquiry carried out by the AO in this regard. Accordingly, disallowance of Rs.65,61,713/- is upheld.” 3 ITA No.1594/PUN/2019 A.Y. : 2012-13 Ace Brain Systems & Software P.Ltd., “Ground No. 2: 9. In Ground No. 2 the appellant is aggrieved on account of action of the AO in making disallowance of Rs.1,52,807/- u/s 36(l)(va) representing employee's contribution to provident fund. This issue has been discussed in Para 5 of the assessment order. The disallowance was made on the ground that payment was made beyond the due date as required u/s 36(1)(va) of the I.T. Act, 1961. This issue requires to be decided in favour of the appellant in view of the decision of Hon. Bombay High Court in the cases of CIT vs Ghatge Patil Transport Ltd. 368 ITR 0749(Bom) and Hindustan organic Chemicals Ltd., 366 ITR Page 1. Accordingly, relying on the above two decisions of Hon. Bombay High Court , the AO is directed to delete the addition of Rs. 1,52,807/-. Accordingly, the ground is allowed.” 4. Learned counsel vehemently argued that the both the lower authorities have erred in law and on facts in treating impugned purchases as bogus despite the fact that all the corresponding documentary evidence had been duly filed in lower proceedings. We find no merit in assessee’s instant arguments once it has failed to prove the impugned purchases by leading all the relevant supportive evidence. The impugned disallowance stands affirmed in principle therefore. 5. Next comes the important issue of quantification of impugned disallowance. It emerges during the course of hearing that this assessee is trader in computers hardware, software and sales and services etc. The 4 ITA No.1594/PUN/2019 A.Y. : 2012-13 Ace Brain Systems & Software P.Ltd., Revenue could hardly dispute the fact that not only the corresponding sales had been accepted but also the assessee’s stock inventory to this effect has never been disputed in the lower proceedings. That being the case, we quote jurisdictional high court’s decision in PCIT V/s M/s. Paramshakti distributors P.Ltd in Income Tax Appeal No. 413 of 2017 dated 15.07.2019 to restrict the impugned disallowance of Rs.65,61,713/- to that @ of 12.5% only with a rider that the same shall not be treated as a precedent. Necessary computation shall follow as per law. The assessee’s instant sole substantive grievance is partly accepted in very terms. Learned counsel does not press for assessee’s first substantive ground challenging validity of section 143/147 proceedings. Rejected accordingly. 6. This assessee’s appeal is partly allowed in above terms. Order pronounced in the Open Court on this 29 th day of August, 2022. Sd/- Sd/- (DR.DIPAK P.RIPOTE) (S.S. GODARA) लेखध सदस्य/ ACCOUNTANT MEMBER न्यधनयक सदस्य/JUDICIAL MEMBER पपणे / Pune; ददनधांक / Dated : 29 th August, 2022. Ashwini 5 ITA No.1594/PUN/2019 A.Y. : 2012-13 Ace Brain Systems & Software P.Ltd., आदेश की प्रनतनलनप अग्रेनषत / Copy of the Order forwarded to : 1. अपऩलधथी / The Appellant. 2. प्रत्यथी / The Respondent. 3. The CIT(A), Pune. 4. The Pr.CIT-1, Pune. 5. नवभधगऩय प्रनतनननध, आयकर अपऩलऩय अनधकरण, “ए” बेंच, पपणे / DR, ITAT, “A” Bench, Pune. 6. गधर्ा फ़धइल / Guard File. आदेशधनपसधर / BY ORDER, // True Copy // Senior Private Secretary आयकर अपऩलऩय अनधकरण, पपणे / ITAT, Pune. 6 ITA No.1594/PUN/2019 A.Y. : 2012-13 Ace Brain Systems & Software P.Ltd., S.No. Details Date Initials 1 Draft dictated on 22.06.2022 2 Draft placed before author 25.08.2022 3 Draft proposed & placed before the Second Member 4 Draft discussed/approved by Second Member 5 Approved Draft comes to the Sr. PS/PS 6 Kept for pronouncement on 7 Date of uploading of Order 8 File sent to Bench Clerk 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