DCIT CENT. CIR 1(2) , MUMBAI V. M/S. ALPHA ASSOCIATES, MUMBAI

ITA 1851/MUM/2021

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 9678 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2022
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 26-09-2022
• Assessment Year: 2008-2009
• Appeal Filed On: 11-10-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Bogus purchase; Search and seizure; Additional evidence
• Section: 143(3); 153C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “H” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER)AND MS KAVITHA RAJAGOPAL (JUDICIAL MEMBER) ITA No. 1558/MUM/2021 Assessment Year: 2008-09 & ITA No. 1559/MUM/2021 Assessment Year: 2009-10 & ITA No. 1560/MUM/2021 Assessment Year: 2010-11 & ITA No. 1556/MUM/2021 Assessment Year: 2011-12 & ITA No. 1557/MUM/2021 Assessment Year: 2012-13 HGP Community Pvt. Ltd. successor to Alpha Associates, 514, Dalamal Towers, 211, F P J Marg, Nariman Point, Mumbai-400021. Vs. Dy. CIT, Central Circle-1(2), 906, 9 th floor, Pratistha Bhavan, Old CGO Building, (Annexe), M.K. Road, Mumbai-400020. PAN No. AADCH 8389 P Appellant Respondent ITA No. 1851/MUM/2021 Assessment Year: 2008-09 & ITA No. 1846/MUM/2021 Assessment Year: 2010-11 Dy. Commissioner of Income-tax, Central Circle-1(2), 906, 9 th floor, Pratishtha Bahvan, Old CGO Bldg. (Annexe), M.K. Road, Vs. HGP Community Pvt. Ltd. successor to Alpha Associates, 514, Dalamal Towers, 211, F P J Marg, Nariman Point, Mumbai-400020. Appellant Revenue by Assessee by Date of Hearing Date of pronouncement PER OM PRAKASH KANT, AM The captioned appeals 2008-09 to 2012-13 orders passed by the learned CIT(Appeals) Ld. CIT(A)]. The cross appeals by the Revenue have been filed for assessment years 2008 been raised by the assessee as well as by the respective appeals and therefore, these appeals ITA Nos. 1851 & 1846/M/2021 Mumbai-400021. PAN No. AADCH 8389 P Respondent : Mr. Rakesh Ranjan, CIT-DR Assessee by : Mr. K. Gopal, Sr. Adv. a/w Om Kandalkar, Adv. Date of Hearing : 27/09/2022 pronouncement : 27/10/2022 ORDER PER OM PRAKASH KANT, AM The captioned appeals by the assessee for assessment years 13 have been preferred against the respective orders passed by the learned CIT(Appeals)-47, Mumbai [in short the . The cross appeals by the Revenue have been filed for assessment years 2008-09 and 2010-11. Identical grounds have been raised by the assessee as well as by the Revenue in their respective appeals and therefore, these appeals were M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 2 400021. AADCH 8389 P DR a/w Om Kandalkar, Adv. by the assessee for assessment years against the respective umbai [in short the . The cross appeals by the Revenue have been filed for 11. Identical grounds have evenue in their were heard together and disposed off by way of this convenience and avoid repetition of facts. 2. Consequent to conversion of the assessee namely M/s Alpha associates( i.e. a partnership firm ) namely HGP community private limited, the assesseeand have filed revised for No. 36, which are placed on record. 3. Briefly stated facts of the case are that the assessee filed regular returns of income for relevan 2008-09 to 2012-13 wherever applicable as per record on the premises of “ 11/03/2014 by the Mumbai. Duringsearch Hiranandani, Managing Director of various companies of the group/ Partner of firms of the group, accepted booking of bogus purchases in books of accounts of the group e ITA Nos. 1851 & 1846/M/2021 disposed off by way of this consolidated order for sake of convenience and avoid repetition of facts. Consequent to conversion of the assessee namely M/s Alpha ( i.e. a partnership firm ), into a private limited company namely HGP community private limited, the assesseeand have filed revised for No. 36, which are placed on record. Briefly stated facts of the case are that the assessee filed regular returns of income for relevant assessment years from AY 13 ,which were subjected to scrutiny assessments wherever applicable as per records. Subsequently, a search action “ M/s Hiranandani Group” was carried out on 11/03/2014 by the Investigation wing of Income-tax Department search proceeding on 12/05/2014, Sh , Managing Director of various companies of the group/ Partner of firms of the group, accepted booking of bogus purchases in books of accounts of the group entities M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 3 order for sake of Consequent to conversion of the assessee namely M/s Alpha , into a private limited company namely HGP community private limited, the assesseeand Revenue have filed revised for No. 36, which are placed on record. Briefly stated facts of the case are that the assessee filed sessment years from AY were subjected to scrutiny assessments . Subsequently, a search action was carried out on tax Department proceeding on 12/05/2014, Sh. Niranjan , Managing Director of various companies of the group/ Partner of firms of the group, accepted booking of bogus purchases ntities amounting to ₹57,37,26,731/-. In post search proceeding before the wing, this amount was revised to was determined by aggregating purchases from parties listed by the Maharashtra VAT authorities as sus various entities of the group. In respect of 11 other entities group, petitions were preferred before the and amount of ₹58,47,66, respect of the assessee no s 3.1 In view of incriminating material belonging to the assessee seized and found at the premises of Hiranandani Group, after recording satisfaction under the provisions of the Act, a notice under section 153C of the issued on 05/01/2015 for assessment year 2008 Subsequently statutory notices under the assessment under section 15 were completed on ITA Nos. 1851 & 1846/M/2021 . In post search proceeding before the was revised to ₹ 60,28,51,896.50/ was determined by aggregating purchases from parties listed by the Maharashtra VAT authorities as suspicious dealers in the case of various entities of the group. In respect of 11 other entities , petitions were preferred before the Settlement 58,47,66,021/- was offered for settlement, but in respect of the assessee no settlement application was preferred. In view of incriminating material belonging to the assessee seized and found at the premises of Hiranandani Group, after recording satisfaction under the provisions of the Act, a notice under C of the Income-tax Act, 1961 (in short issued on 05/01/2015 for assessment year 2008-09 to AY 2012 Subsequently statutory notices under the Act were assessment under section 153C read with section 143(3) of the Act were completed on 18/06/2015, wherein addition/ disallowance M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 4 . In post search proceeding before the Investigation 896.50/-. This amount was determined by aggregating purchases from parties listed by the picious dealers in the case of various entities of the group. In respect of 11 other entities of ettlement Commission was offered for settlement, but in ettlement application was preferred. In view of incriminating material belonging to the assessee seized and found at the premises of Hiranandani Group, after recording satisfaction under the provisions of the Act, a notice under in short ‘the Act’) was 09 to AY 2012-13. were issued and 3C read with section 143(3) of the Act 18/06/2015, wherein addition/ disallowance including disallowance for bogus purchases were made. The Ld CIT(A) adjudicated the appeals Aggrieved with the same ITAT ( in short the ‘Tribunal 4. The grounds raised by the assessee in assessment year 2008 09 to 2012-13 are identical except disallowance of bogus purchases. A list of party of purchases for various assessment years is as follows: 4.1 As the issue in dispute of disallowance of bogus purchases in the appeals of the assessee is identical and amount thereon , therefore, case for AY 2008 ITA Nos. 1851 & 1846/M/2021 including disallowance for bogus purchases were made. The Ld CIT(A) adjudicated the appeals vide respective impugned orders with the same, the assessee and Revenue are before the Tribunal’) by way of raising respective grounds. The grounds raised by the assessee in assessment year 2008 13 are identical except change of disallowance of bogus purchases. A list of party-wise disallowance ious assessment years is as follows: As the issue in dispute of disallowance of bogus purchases in ls of the assessee is identical, except name of the parties and amount thereon , therefore, case for AY 2008-09 M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 5 including disallowance for bogus purchases were made. The Ld. ide respective impugned orders . the assessee and Revenue are before the by way of raising respective grounds. The grounds raised by the assessee in assessment year 2008- change of amount of wise disallowance ious assessment years is as follows: As the issue in dispute of disallowance of bogus purchases in , except name of the parties 09 is taken as lead case and which would ground raised in 2008 “1. The learned Commissioner of Income Tax (Appeals) erred in confirming action of the Assessing Officer in disallowing purch from J D Bricks and Sand Suppliers of Rs. 2,39,139/ same are non-genuine and reducing the same from WIP. 2. The appellant prays that: i. Work in progress may be determined as per books of accounts, ii. any other relief your Honours 3. The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal. 5. The alleged non assessment year 2008 Assessing Officer has ma reasons. Firstly, the documentation of the purchase bills in dispute was not made according to the standard procedure followed by the purchase department of the assessee group and bills have not been passed through certain checks by the purchase Department which were required in normal course. Secondly, ITA Nos. 1851 & 1846/M/2021 would be followed in other assessment years ground raised in 2008-09 is reproduced as under: 1. The learned Commissioner of Income Tax (Appeals) erred in confirming action of the Assessing Officer in disallowing purch from J D Bricks and Sand Suppliers of Rs. 2,39,139/- stating that the genuine and reducing the same from WIP. 2. The appellant prays that: Work in progress may be determined as per books of accounts, any other relief your Honours may deem fit. The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal. non-genuine purchases corresponding to the assessment year 2008-09 are amounting to ₹2,39, Assessing Officer has made the disallowance mainly due to three reasons. Firstly, the documentation of the purchase bills in dispute was not made according to the standard procedure followed by the purchase department of the assessee group and bills have not been ertain checks by the purchase Department which were required in normal course. Secondly, the entries of purchases M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 6 assessment years. The 1. The learned Commissioner of Income Tax (Appeals) erred in confirming action of the Assessing Officer in disallowing purchases stating that the Work in progress may be determined as per books of accounts, The appellant craves leave to add, alter, amend or delete any of the genuine purchases corresponding to the 2,39,139/-. The Ld. de the disallowance mainly due to three reasons. Firstly, the documentation of the purchase bills in dispute was not made according to the standard procedure followed by the purchase department of the assessee group and bills have not been ertain checks by the purchase Department which the entries of purchases made in SAP system ( i.e. books maintained electronically) user ID CLA0016have been offered before the settlement commission in case therefore the entries of the purchase bills in dispute made in the SAP system using the tainted User ID: CLA0016 liable for disallowance in the list of ‘Hawala i.e. a list of the parties which were engaged accommodation bills ‘Hiranandani group’ parties as non-genuine before the settlement commission in case of other entities of the group. 6. Before the Ld. CIT(A) it was purchases submitted during the course of the search w ,which contained some of the genuine purchases entered system through users ITA Nos. 1851 & 1846/M/2021 in SAP system ( i.e. books maintained electronically) user ID CLA0016have been offered before the settlement of other entities of the ‘Hiranandani the entries of the purchase bills in dispute made in the SAP system using the tainted User ID: CLA0016 are also bogus and liable for disallowance. Thirdly, these purchase parties were already Hawala’ Parties of Maharashtra Sales Tax Department i.e. a list of the parties which were engaged accommodation bills without actual delivery of goods. Fourthly, has offered the purchases from very same genuine before the settlement commission in case of other entities of the group. Before the Ld. CIT(A) it was explained that working of bogus purchases submitted during the course of the search w some of the genuine purchases entered s Id other thantainted user “ID: CLA0016”. The M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 7 in SAP system ( i.e. books maintained electronically) using the user ID CLA0016have been offered before the settlement ‘Hiranandani group’, the entries of the purchase bills in dispute made in the are also bogus and . Thirdly, these purchase parties were already Sales Tax Department i.e. a list of the parties which were engaged in issuing without actual delivery of goods. Fourthly, the has offered the purchases from very same genuine before the settlement commission in case of that working of bogus purchases submitted during the course of the search was tentative some of the genuine purchases entered in SAP ID: CLA0016”. The assessee produced bills and vouchers of the parties listed in table along with details of payments made to th The assessee also relied on the decision dated 26/09/2016 of the learned first appellate authority in the case of sister concern namely M/s Sears Constructions, addition. 7. The Ld. CIT(A) vide im observing as under: “10.4 I have considered the arguments of the assessee and do not agree with the same. It appears that the fact about purchase as per ID 'CLA0062', as calmed by the assessee now, were never mentloned by the assessee at the time of search and seizure action. Neither Shri Deepak Vibhute, purchase head of the company mentioned this fact nor Shri Niranjan Hiranandant director of the group stated anything in this regard. In fact it appears that during the c these facts were not mentioned by the assessee. On the contrary the working of bogus purchase as per Annexure statement of Shri Deepak Vibhute and as per Annexure statement on oath u/s 132(4) of the A Hiranadani at the fime of search and selzure action clearly ITA Nos. 1851 & 1846/M/2021 assessee produced bills and vouchers of the parties listed in able along with details of payments made to them through cheque. The assessee also relied on the decision dated 26/09/2016 of the first appellate authority in the case of sister concern namely M/s Sears Constructions, wherein he directed to delete identical The Ld. CIT(A) vide impugned order upheld the disallowance 10.4 I have considered the arguments of the assessee and do not agree with the same. It appears that the fact about purchase as per ID 'CLA0062', as calmed by the assessee now, were never by the assessee at the time of search and seizure action. Neither Shri Deepak Vibhute, purchase head of the company mentioned this fact nor Shri Niranjan Hiranandant director of the group stated anything in this regard. In fact it appears that during the course of assessment proceedings also, these facts were not mentioned by the assessee. On the contrary the working of bogus purchase as per Annexure-3 to the statement of Shri Deepak Vibhute and as per Annexure-2 to the statement on oath u/s 132(4) of the Act and shri Nirannjan Hiranadani at the fime of search and selzure action clearly M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 8 assessee produced bills and vouchers of the parties listed in above em through cheque. The assessee also relied on the decision dated 26/09/2016 of the first appellate authority in the case of sister concern namely in he directed to delete identical pugned order upheld the disallowance 10.4 I have considered the arguments of the assessee and do not agree with the same. It appears that the fact about purchase as per ID 'CLA0062', as calmed by the assessee now, were never by the assessee at the time of search and seizure action. Neither Shri Deepak Vibhute, purchase head of the company mentioned this fact nor Shri Niranjan Hiranandant director of the group stated anything in this regard. In fact it ourse of assessment proceedings also, these facts were not mentioned by the assessee. On the contrary 3 to the 2 to the ct and shri Nirannjan Hiranadani at the fime of search and selzure action clearly indicated the above mentioned purchases as bogus. In these circumstances I am not in a position to accept the contention of the asessee that these purchases were genuine, Tho assessee argued that amount of such purchases were so small and therefore there is no reason at to why the assessee should have made such bogus purchases but the important fact is that these purchases are part of overall bogus purchases of over Rs. 57 crores detected during the course of search and seizure action and surrendered by both Shri Deepak Vibhute and Shri Niranian Hitanandant.Therefore this explanation of the assessee also fails. 10.5 The assessee in this regard also relled upon the order Ld.Predecessor in case of Sears Construction Pvt. Ltd. dated 26.09.2016, wherein he towards purchases, as per ID "CLA0062' disagree with the findings of my Ld. Predecessor. Asfacts stand today, these purchases were surrendered both by the purchase head of the assessee group as also by Shri Niran an Hiranandani the Director and the main person of the assessee company. Further complete working of such bogus purchases were given as part of Annexure Annexure A-2 to the statement of Shri Niranjan hiranandant where detalls of above purchases from JD Brick & Sand Suppliers is clearly appearing. No clarifications were given by the assessee elther during t the assessment proceedings in this regard, nor any statement given by the above mentioned two persons in the records of bogus purchases were retracted even untll today. in these ITA Nos. 1851 & 1846/M/2021 indicated the above mentioned purchases as bogus. In these circumstances I am not in a position to accept the contention of the asessee that these purchases were genuine, Though the assessee argued that amount of such purchases were so small and therefore there is no reason at to why the assessee should have made such bogus purchases but the important fact is that these purchases are part of overall bogus purchases of over Rs. 57 crores detected during the course of search and seizure action and surrendered by both Shri Deepak Vibhute and Shri Niranian Hitanandant.Therefore this explanation of the assessee also fails. 10.5 The assessee in this regard also relled upon the order Ld.Predecessor in case of Sears Construction Pvt. Ltd. dated 26.09.2016, wherein he accepted the claim of the assesssee towards purchases, as per ID "CLA0062'. However, I respectfully disagree with the findings of my Ld. Predecessor. Asfacts stand day, these purchases were surrendered both by the purchase head of the assessee group as also by Shri Niran an Hiranandani the Director and the main person of the assessee company. Further complete working of such bogus purchases were given as xure-3 of the statement of Shri Deepak Vibhute and 2 to the statement of Shri Niranjan hiranandant where detalls of above purchases from JD Brick & Sand Suppliers is clearly appearing. No clarifications were given by the assessee elther during the course of post search investigation or during the assessment proceedings in this regard, nor any statement given by the above mentioned two persons in the records of bogus purchases were retracted even untll today. in these M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 9 indicated the above mentioned purchases as bogus. In these circumstances I am not in a position to accept the contention of ugh the assessee argued that amount of such purchases were so small and therefore there is no reason at to why the assessee should have made such bogus purchases but the important fact is that these purchases are part of overall bogus purchases of over Rs. 57 crores detected during the course of search and seizure action and surrendered by both Shri Deepak Vibhute and Shri Niranian Hitanandant.Therefore this explanation of the assessee also fails. 10.5 The assessee in this regard also relled upon the order of my Ld.Predecessor in case of Sears Construction Pvt. Ltd. dated claim of the assesssee . However, I respectfully disagree with the findings of my Ld. Predecessor. Asfacts stand day, these purchases were surrendered both by the purchase head of the assessee group as also by Shri Niran an Hiranandani the Director and the main person of the assessee company. Further complete working of such bogus purchases were given as 3 of the statement of Shri Deepak Vibhute and 2 to the statement of Shri Niranjan hiranandant where detalls of above purchases from JD Brick & Sand Suppliers is clearly appearing. No clarifications were given by the assessee he course of post search investigation or during the assessment proceedings in this regard, nor any statement given by the above mentioned two persons in the records of bogus purchases were retracted even untll today. in these circumstances 1 do not find a by the AO.Therefore the ad 8. Before us, the Ld. Counsel of the assessee submitted that purchases in dispute were made in routine course of the business. Further, the assessee ha account of the parties in the books of accounts of the assessee invoices issued by the parties prepared; octroi receipt statement etc. demonstrati course of business. Regarding the Sales Tax Department of providing accommodation entry bills, the Ld. Counsel submitted that same the VAT amount has already been paid by the purchaser and therefore those purchase /sale transactions are no longer transaction as per VAT Authorities. purchases enteries CLF0076 whereas the ITA Nos. 1851 & 1846/M/2021 circumstances 1 do not find any reason to deviate the view taken by the AO.Therefore the addition made by the AO. is upheld.” Before us, the Ld. Counsel of the assessee submitted that purchases in dispute were made in routine course of the business. Further, the assessee had already submitted copies of the ledger account of the parties in the books of accounts of the assessee invoices issued by the parties; goods receipt note internally octroi receipt; bank payment vouchers statement etc. demonstrating that purchases were made in regular business. Regarding the statements of the parties the Sales Tax Department of providing accommodation entry bills, the Ld. Counsel submitted that same are self-serving statements and has already been paid by the purchaser and therefore those purchase /sale transactions are no longer as per VAT Authorities. . Further, it was submitted that in question have been made CLF0076 whereas the other purchases which have been admitted by M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 10 ny reason to deviate the view taken dition made by the AO. is upheld.” Before us, the Ld. Counsel of the assessee submitted that purchases in dispute were made in routine course of the business. already submitted copies of the ledger account of the parties in the books of accounts of the assessee ; goods receipt note internally bank payment vouchers; copy of bank ng that purchases were made in regular of the partiesbefore the Sales Tax Department of providing accommodation entry bills, serving statements and has already been paid by the purchaser and therefore those purchase /sale transactions are no longer bogus . Further, it was submitted that in question have been made using user ID other purchases which have been admitted by the Hiranandani Group from the ID No. CLA00 all the steps, which Mr. Deepak admitted in statements during the course of search proceedings, have been duly recorded case of these purchases in question irregularity in recording purchase in case of the assessee in the years under consideration. The Ld. Counsel relied on the decision of the ITAT ‘J’ Bench in the case of M/s Sears Construction Pvt. Ltd. v. DCIT (ITA No. 6975/M/2016) for assessment year 2012 wherein identical disallowance made by the Assessing Officer respect of the purchases from hawala parties which were surrendered by the Director of the Hiranandani Group deleted. 9. The Ld. DR on the other hand, submitted that the fact that document in support of purchases including ITA Nos. 1851 & 1846/M/2021 the Hiranandani Group as bogus were entered in the save statement from the ID No. CLA0016. The Ld. Counsel before us, submitted that steps, which Mr. DeepakT VibhuteSenior Purchase Manager atements during the course of search proceedings, have been duly recorded by the Purchase /Accounts Department case of these purchases in question and therefore, there is no irregularity in recording purchase in case of the assessee in the consideration. The Ld. Counsel relied on the decision of the ITAT ‘J’ Bench in the case of M/s Sears Construction Pvt. Ltd. v. DCIT (ITA No. 6975/M/2016) for assessment year 2012 wherein identical disallowance made by the Assessing Officer f the purchases from hawala parties which were surrendered by the Director of the Hiranandani Group The Ld. DR on the other hand, submitted that the fact that document in support of purchases including weighment slips; M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 11 were entered in the save statement 6. The Ld. Counsel before us, submitted that Senior Purchase Manager atements during the course of search proceedings, by the Purchase /Accounts Department in and therefore, there is no irregularity in recording purchase in case of the assessee in the consideration. The Ld. Counsel relied on the decision of the ITAT ‘J’ Bench in the case of M/s Sears Construction Pvt. Ltd. v. DCIT (ITA No. 6975/M/2016) for assessment year 2012-13, wherein identical disallowance made by the Assessing Officer in f the purchases from hawala parties which were surrendered by the Director of the Hiranandani Group, have been The Ld. DR on the other hand, submitted that the fact that weighment slips; excise gate pass etc. have not been filed by the assessee in respect of th purchase bills before either the Assessing Officer or the Ld. CIT(A) and therefore, it could not made in regular course of the business. He also submit as the evidences department /audit of the purchase bills after receipt in the account Department is concerned first time before the Tribunal of additional evidence for proper verification. Further, he submitted that when the tax payers of the Hiranandani Group income before the settlement commis shown from the very same parties in the case of the assessee could be treated as genuine purchase without any contrary evidence. ITA Nos. 1851 & 1846/M/2021 ss etc. have not been filed by the assessee in respect of th purchase bills before either the Assessing Officer or the Ld. CIT(A) and therefore, it could not be established that those purchases were made in regular course of the business. He also submit justifying different steps by the account /audit of the purchase bills after receipt in the account Department is concerned, the documents have been filed for the before the Tribunal and therefore same being in the nature of additional evidences, need to be referred to the Assessing Officer for proper verification. Further, he submitted that when the tax payers of the Hiranandani Group has offered undisclosed income before the settlement commission in case of purchases very same parties , then how the claim in respect of same parties in the case of the assessee could be treated as genuine purchase without any contrary evidence. M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 12 ss etc. have not been filed by the assessee in respect of those purchase bills before either the Assessing Officer or the Ld. CIT(A) se purchases were made in regular course of the business. He also submitted that as far different steps by the account /audit of the purchase bills after receipt in the account the documents have been filed for the e being in the nature need to be referred to the Assessing Officer for proper verification. Further, he submitted that when the other has offered undisclosed sion in case of purchases then how the claim in respect of same parties in the case of the assessee could be treated as genuine 10. We have heard, rival submissions of the parties on the issue dispute and perused the relevant material on record. We find that in the instant case, the dispute is regarding the purchases of ₹2,39,139/- from M/s J.D. not. According to the Assessing Officer, purchase documents does not meet the list of supporting other documents prescribed by the Hiranandani group for passing of bills , weighment slip; goods receipt note has also pointed out that the purchases in dispute have been recorded in the SAP for recording non-genuine purchases from parties income in respect of which has already been declared Settlement Commission. The Ld. AO also same parties have been admitted as non entities and corresponding income before the settlement commission. Before us, the as ITA Nos. 1851 & 1846/M/2021 We have heard, rival submissions of the parties on the issue dispute and perused the relevant material on record. We find that in the instant case, the dispute is regarding the purchases of from M/s J.D. Bricks,whether the same not. According to the Assessing Officer, purchase documents does of supporting other documents prescribed by the Hiranandani group for passing of bills , oods receipt note, etc. The Ld. Assessing Off has also pointed out that the purchases in dispute have been system by using same user ID which was used genuine purchases from parties, t income in respect of which has already been declared ommission. The Ld. AO also held that purchases from same parties have been admitted as non-genuine in case of other entities and corresponding amount has been offered as undisclosed income before the settlement commission. Before us, the as M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 13 We have heard, rival submissions of the parties on the issue-in- dispute and perused the relevant material on record. We find that in the instant case, the dispute is regarding the purchases of ,whether the same is genuine or not. According to the Assessing Officer, purchase documents does of supporting other documents / various steps prescribed by the Hiranandani group for passing of bills , like etc. The Ld. Assessing Officer has also pointed out that the purchases in dispute have been system by using same user ID which was used , the undisclosed income in respect of which has already been declared before the that purchases from genuine in case of other has been offered as undisclosed income before the settlement commission. Before us, the assessee has filed copies of the purchase bills which has passed during through the different channels of the account section relevant entries have been recorded on those purchase bills 11. During the search for purchase were Tukaram Vibhute, Sr. project Manager purchase was recorded on 13/03/2014. In said statement he explained the regular practice of documentation for purchase purchases of steel purchase documents must contained purchase bill, delivery Challan, test results , excise gate pass, and engineer certificate. On receiving of the goods in entries were made in records including marking of security and store entry at the backside of the challan, signature of the person who received the material and mentioning of goods received No. (GRN) on the bill by the store in department also six entries were made including stamp of received ITA Nos. 1851 & 1846/M/2021 has filed copies of the purchase bills which has passed during through the different channels of the account section relevant entries have been recorded on those purchase bills During the search, inconsistencies in documents maintained found, therefore statement of Sh Deepak Tukaram Vibhute, Sr. project Manager purchase was recorded on 13/03/2014. In said statement he explained the regular practice of documentation for purchase records. He stated that in case of purchases of steel purchase documents must contained purchase bill, delivery Challan, test results , excise gate pass, and engineer certificate. On receiving of the goods in in records including marking of security and store entry at the backside of the challan, signature of the person who received the material and mentioning of goods received (GRN) on the bill by the store in-charge. In the account six entries were made including stamp of received M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 14 has filed copies of the purchase bills which has passed during through the different channels of the account section to show that relevant entries have been recorded on those purchase bills . inconsistencies in documents maintained therefore statement of Sh Deepak Tukaram Vibhute, Sr. project Manager purchase was recorded on 13/03/2014. In said statement he explained the regular practice of records. He stated that in case of purchases of steel purchase documents must contained purchase bill, delivery Challan, test results , excise gate pass, weighment slip and engineer certificate. On receiving of the goods in-store, certain in records including marking of security and store entry at the backside of the challan, signature of the person who received the material and mentioning of goods received note charge. In the account six entries were made including stamp of received with date at the time of receiving of the bill at the account office, junior accountant signature after checking quantity with GRN and attaching challan received from store, entry of Bill booking and octroi, passing of bill signature on front part of the bill, checking of all entries approval, after checking all entries signature by the audit team in green pen and then bill goes for payment, where stamp of “Bill paid” along with cheque No. and entry No. of the payment are marked. 12. During the course of operating procedure had not been followed in purchases from few parties and bills from those parties were directly sent by the management to the account department for entry and for making payment. He admitted that bills of those parties were given director for entry in the books of accounts maintained on computer system and purchases were in the nature of ingenuine purchases. ITA Nos. 1851 & 1846/M/2021 with date at the time of receiving of the bill at the account office, junior accountant signature after checking quantity with GRN and attaching challan received from store, entry of Bill booking and of bill for Rs______ by Assistant Manager and signature on front part of the bill, checking of all entries approval, after checking all entries signature by the audit team in green pen and then bill goes for payment, where stamp of “Bill paid” along with cheque No. and entry No. of the payment are marked. During the course of statement, he admitted that s operating procedure had not been followed in purchases from few parties and bills from those parties were directly sent by the management to the account department for entry and for making payment. He admitted that bills of those parties were given in the books of accounts maintained on computer system and purchases were in the nature of ingenuine purchases. M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 15 with date at the time of receiving of the bill at the account office, junior accountant signature after checking quantity with GRN and attaching challan received from store, entry of Bill booking and y Assistant Manager and signature on front part of the bill, checking of all entries and approval, after checking all entries signature by the audit team in green pen and then bill goes for payment, where stamp of “Bill paid” along with cheque No. and entry No. of the payment are marked. he admitted that standard operating procedure had not been followed in purchases from few parties and bills from those parties were directly sent by the management to the account department for entry and for making payment. He admitted that bills of those parties were given by the in the books of accounts maintained on computer system and purchases were in the nature of ingenuine purchases. 13. In the light of statements of Sh Deepak Vibhute, which were duly affirmed by the Principal Person of the Group of the Ld Counsel raised before us as to entries have been made on th the end of the Assessing Officer. 14. As regards, the user ID is concerned, admitted that entries in respect of those ingenuine purchases were made in SAP systems ( software for maintaining business transaction ) using the userid “CLA0016”. He confirmed that said userid was of Sh Kishire Sawant, who expired on 20 assessee has filed before us administrator that purchases in question have been entered by another user ID CLF 0076. countersigned by the Managing Director of the assessee but same has not been complied. Therefore, t at the end of the Assessing Officer. ITA Nos. 1851 & 1846/M/2021 In the light of statements of Sh Deepak Vibhute, which were duly affirmed by the Principal Person of the Group , of the Ld Counsel raised before us as to whether all the relevant entries have been made on those purchase bills, need verification at the end of the Assessing Officer. As regards, the user ID is concerned, Sh Deepak admitted that entries in respect of those ingenuine purchases were made in SAP systems ( software for maintaining business transaction ) using the userid “CLA0016”. He confirmed that said userid was of Sh Kishire Sawant, who expired on 20 assessee has filed before us a certificate from the system administrator that purchases in question have been entered by another user ID CLF 0076. This certificate was directed to be countersigned by the Managing Director of the assessee but same been complied. Therefore, this issue also needs verification at the end of the Assessing Officer. M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 16 In the light of statements of Sh Deepak Vibhute, which were , this contention whether all the relevant need verification at Sh Deepak Vibhute admitted that entries in respect of those ingenuine purchases were made in SAP systems ( software for maintaining business transaction ) using the userid “CLA0016”. He confirmed that said th No. 2012. The from the system administrator that purchases in question have been entered by This certificate was directed to be countersigned by the Managing Director of the assessee but same his issue also needs verification 15. Further, the Hon’ble Tribunal in the case of M/s Sears Construction Pvt. Ltd. (supra) “3.2. In the light of the above recording, w hereunder a decision from Hon'ble jurisdictional High Court in the case CIT vs Nikunj Exim Enterprises Pvt. Ltd. (2015) 372 ITR 619 (Bom.):- “7. We have considered the submission on behalf of the Revenue. However, from the order of the Tr find that the Tribunal has deleted the additions on account of bogus purchases not only on the basis of stock statement, i.e., reconciliation statement but also in view of the other facts. The Tribunal records that the books assessee have not been rejected. Similarly, the sales have not been doubted and it is an admitted position that substantial amount of sales have been made to the Government Department, i.e., Defence Research and Development La Further, there were confirmation letters filed by the suppliers, copies of invoices for purchases as well as copies of bank statement all of which would indicate that the purchases were in fact made. In our view, merely because the sup appeared before the Assessing Officer or the Commissioner of Income-tax (Appeals), one cannot conclude that the purchases were notmade by the respondent as well as the Commissioner of Income disallowed the deduction of Rs. 1.33 crores on account of purchases merely on the basis of suspicion because the sellers ITA Nos. 1851 & 1846/M/2021 Further, the Hon’ble Tribunal in the case of M/s Sears Construction Pvt. Ltd. (supra) has decided as under : 3.2. In the light of the above recording, we are reproducing hereunder a decision from Hon'ble jurisdictional High Court in the case CIT vs Nikunj Exim Enterprises Pvt. Ltd. (2015) 372 ITR “7. We have considered the submission on behalf of the Revenue. However, from the order of the Tribunal dated April 30, 2010, we find that the Tribunal has deleted the additions on account of bogus purchases not only on the basis of stock statement, i.e., reconciliation statement but also in view of the other facts. The Tribunal records that the books of account of the respondent assessee have not been rejected. Similarly, the sales have not been doubted and it is an admitted position that substantial amount of sales have been made to the Government Department, i.e., Defence Research and Development Laboratory, Hyderabad. Further, there were confirmation letters filed by the suppliers, copies of invoices for purchases as well as copies of bank statement all of which would indicate that the purchases were in fact made. In our view, merely because the suppliers have not appeared before the Assessing Officer or the Commissioner of tax (Appeals), one cannot conclude that the purchases were notmade by the respondent-assessee. The Assessing Officer as well as the Commissioner of Income-tax (Appeals) hav disallowed the deduction of Rs. 1.33 crores on account of purchases merely on the basis of suspicion because the sellers M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 17 Further, the Hon’ble Tribunal in the case of M/s Sears e are reproducing hereunder a decision from Hon'ble jurisdictional High Court in the case CIT vs Nikunj Exim Enterprises Pvt. Ltd. (2015) 372 ITR “7. We have considered the submission on behalf of the Revenue. ibunal dated April 30, 2010, we find that the Tribunal has deleted the additions on account of bogus purchases not only on the basis of stock statement, i.e., reconciliation statement but also in view of the other facts. The of account of the respondent- assessee have not been rejected. Similarly, the sales have not been doubted and it is an admitted position that substantial amount of sales have been made to the Government Department, boratory, Hyderabad. Further, there were confirmation letters filed by the suppliers, copies of invoices for purchases as well as copies of bank statement all of which would indicate that the purchases were in pliers have not appeared before the Assessing Officer or the Commissioner of tax (Appeals), one cannot conclude that the purchases assessee. The Assessing Officer tax (Appeals) have disallowed the deduction of Rs. 1.33 crores on account of purchases merely on the basis of suspicion because the sellers and the canvassing agents have not been produced before them. We find that the order of the Tribunal is well a reasoned order taking into account all the facts before concluding that the purchases of Rs. 1.33 crores was not bogus. No fault can be found with the order dated April 30, 2010, of the Tribunal.” 3.3. If the aforesaid decision is analyzed with the facts of the present appeal, Assessing Officer on the basis of information available with the Maharashtra VAT authorities with respect to suspicious dealers. The amount of purchases involved in the present appeal includes both genuine and uncontroverted finding in the impugned order that the purchases from Abhinav Buildmat Pvt. Ltd. of Rs.7,848/ of Rs.98,618/- which are included in the additi are passed by user ID CLA0076 and EO425. No adverse material was brought to our notice by the Revenue. So far as, remaining non-genuine purchases are concerned, the assessee approached the settlement commission and a particu vide application under section 245C made by the Group companies admitted of inflating thepurchases. Thus, for the remaining purchases, we find no infirmity in the conclusion drawn by the Ld. Commissioner of Income Tax (Appeal), consequently, this ground of the Revenue is dismissed. 15.1 In view of the above facts and circumstances, we feel it appropriate to restore the issue to the file of the Assessing Officer ITA Nos. 1851 & 1846/M/2021 and the canvassing agents have not been produced before them. We find that the order of the Tribunal is well a reasoned order into account all the facts before concluding that the purchases of Rs. 1.33 crores was not bogus. No fault can be found with the order dated April 30, 2010, of the Tribunal.” 3.3. If the aforesaid decision is analyzed with the facts of the present appeal, we note that the addition was made by the Ld. Assessing Officer on the basis of information available with the Maharashtra VAT authorities with respect to suspicious dealers. The amount of purchases involved in the present appeal includes both genuine and non-genuine purchases. There is uncontroverted finding in the impugned order that the purchases from Abhinav Buildmat Pvt. Ltd. of Rs.7,848/-, H. H. Enterprises - and Krishna Structural Steel of Rs.49,20,751/ which are included in the addition are genuine purchases, which are passed by user ID CLA0076 and EO425. No adverse material was brought to our notice by the Revenue. So far as, remaining genuine purchases are concerned, the assessee approached the settlement commission and a particular decision, wherein, vide application under section 245C made by the Group companies admitted of inflating thepurchases. Thus, for the remaining purchases, we find no infirmity in the conclusion drawn by the Ld. Commissioner of Income Tax (Appeal), quently, this ground of the Revenue is dismissed.” In view of the above facts and circumstances, we feel it appropriate to restore the issue to the file of the Assessing Officer M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 18 and the canvassing agents have not been produced before them. We find that the order of the Tribunal is well a reasoned order into account all the facts before concluding that the purchases of Rs. 1.33 crores was not bogus. No fault can be found 3.3. If the aforesaid decision is analyzed with the facts of the we note that the addition was made by the Ld. Assessing Officer on the basis of information available with the Maharashtra VAT authorities with respect to suspicious dealers. The amount of purchases involved in the present appeal includes genuine purchases. There is uncontroverted finding in the impugned order that the purchases , H. H. Enterprises and Krishna Structural Steel of Rs.49,20,751/- on are genuine purchases, which are passed by user ID CLA0076 and EO425. No adverse material was brought to our notice by the Revenue. So far as, remaining genuine purchases are concerned, the assessee approached lar decision, wherein, vide application under section 245C made by the Group companies admitted of inflating thepurchases. Thus, for the remaining purchases, we find no infirmity in the conclusion drawn by the Ld. Commissioner of Income Tax (Appeal), In view of the above facts and circumstances, we feel it appropriate to restore the issue to the file of the Assessing Officer for deciding afresh in accordance with law submission of the assessee. The ground of appeal of the assessee is accordingly allowed for statistical purposes. 15.2 The ground raised by the assessee therefore , same are also allowed for statistical purposes. 16. Now we take assessment year 2008 17. The first and second ₹3,23,12,047/- which has been deleted by the Ld. CIT(A). This amount consisted of material maintenance and overheads municipal taxes; interest on loan and 18. We have heard rival submissions of the parties on the issue dispute and perused the relevant material on record. year, the assessee gave few flats ( i.e. lease and shown lease ren ITA Nos. 1851 & 1846/M/2021 in accordance with law after considering the ion of the assessee. The ground of appeal of the assessee is accordingly allowed for statistical purposes. raised by the assessee in other years same are also allowed for statistical purposes. up the cross-appeal of the Revenue for assessment year 2008-09. and second ground relates to amount of which has been deleted by the Ld. CIT(A). This amount consisted of material maintenance and overheads terest on loan and brokerage. We have heard rival submissions of the parties on the issue dispute and perused the relevant material on record. gave few flats ( i.e. which were ready to use,) lease and shown lease rental income form the same under the head M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 19 after considering the ion of the assessee. The ground of appeal of the assessee is in other years are identical , same are also allowed for statistical purposes. appeal of the Revenue for ground relates to amount of which has been deleted by the Ld. CIT(A). This amount consisted of material maintenance and overheads; We have heard rival submissions of the parties on the issue-in- dispute and perused the relevant material on record. During the ready to use,) on tal income form the same under the head income form house property, and balance construction of the property was in progress. The assessee incurred certain expenses in relation to the property, which were transferred to closing work in progress. According to the Assessing Officer, a part of the expenses transferred to Closing work the property i.e. flats same stood already property” and thus, same cannot be closing work in progress. ₹3,23,12,047/- reduced by the Assessing Officer out of closing work in-progress claimed by the assessee for the year under consideration. The detail of amount reduced by the Assessing Officer is reproduced as under: S. No. Head of Expenses 1. Material & Maintenance overheads 2. Municipal taxes 3. Interest on loan ITA Nos. 1851 & 1846/M/2021 income form house property, and balance construction of the property was in progress. The assessee incurred certain expenses in relation to the property, which were transferred to closing work in ording to the Assessing Officer, a part of the expenses transferred to Closing work-in-progress pertained to the portion of i.e. flats , which was leased out and deduction for the already allowed under the head “ income from house and thus, same cannot be allowed to be closing work in progress. The dispute is regarding the amount of reduced by the Assessing Officer out of closing work progress claimed by the assessee for the year under ideration. The detail of amount reduced by the Assessing Officer is reproduced as under: Head of Expenses Amt. claimed u/s 24 Amt. debited to P/L/WIP A/c Material & Std. deduction @ 30 per cent = 97,85,173/- 53,16,79,357/- 35,00,000/- 35,00,000/ 1,12,60,020/- 4,78,10,339/- M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 20 income form house property, and balance construction of the flats/ property was in progress. The assessee incurred certain expenses in relation to the property, which were transferred to closing work in ording to the Assessing Officer, a part of the expenses progress pertained to the portion of , which was leased out and deduction for the income from house to be transferred to The dispute is regarding the amount of reduced by the Assessing Officer out of closing work- progress claimed by the assessee for the year under ideration. The detail of amount reduced by the Assessing Officer Amt. debited to Amt. of expenses reduced from WIP 7,16,027/- 35,00,000/- 1,12,60,020/- 4. Brokerage 18.1 Regarding brokerage expenses, it was claimed by the assessee that same was incurred towards development of the project and not to the lease rental income. However, the Assessing Officer was of the view that the brokerage is related to the only lease rental and therefore, same should be reduced from the work We find that before the brought on record any evidence that said brokerage expenditure was in relation to lease rental income. such evidence have been brought on recorded and the Ld CIT(A) simply presumed that brokerage expenses were related to property under construction or property for sale. Therefore , in the interest of substantial justice we feel appropriate to the file of the Assessing officer for deciding afresh , with the direction to the assessee to file necessary evidence in support of the claim that the brokerage expenses in question were incurred in ITA Nos. 1851 & 1846/M/2021 Nil 1,68,36,000/- Reduction from WIP 3,23,12,047/ Regarding brokerage expenses, it was claimed by the assessee that same was incurred towards development of the project and not to the lease rental income. However, the Assessing Officer was of the view that the brokerage is related to the only lease rental and therefore, same should be reduced from the work before the Assessing Officer, the assessee brought on record any evidence that said brokerage expenditure was in relation to lease rental income. Before the The such evidence have been brought on recorded and the Ld CIT(A) simply presumed that brokerage expenses were related to property under construction or property for sale. Therefore , in the interest of substantial justice we feel appropriate to restore this issue back to the file of the Assessing officer for deciding afresh , with the direction to the assessee to file necessary evidence in support of the claim that the brokerage expenses in question were incurred in M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 21 1,68,36,000/- 3,23,12,047/- Regarding brokerage expenses, it was claimed by the assessee that same was incurred towards development of the project and not to the lease rental income. However, the Assessing Officer was of the view that the brokerage is related to the only lease rental income and therefore, same should be reduced from the work-in-progress. , the assessee has not brought on record any evidence that said brokerage expenditure The Ld. CIT(A) no such evidence have been brought on recorded and the Ld CIT(A) simply presumed that brokerage expenses were related to property under construction or property for sale. Therefore , in the interest of restore this issue back to the file of the Assessing officer for deciding afresh , with the direction to the assessee to file necessary evidence in support of the claim that the brokerage expenses in question were incurred in relation to property under con contract agreement with brokers and other documents including details of brokerage income declared by them in their return of income. 19. Regarding the amount of interest on loan of which according to the Assessing Officer pertains to the flats already constructed and leased out and therefore, he directed to reduce the same amount from the work interest on loan in respect of leased portion of be allowed as work-in 24 of the Act under the head ‘income from house property’. Accordingly, we direct the Assessing Officer to verify if the same has been claimed separately u/s 24 in th by the assessee. If so, under closing work- interest of the loan u/s 24 of the Act has been allowed to the ITA Nos. 1851 & 1846/M/2021 relation to property under construction. The assessee may file contract agreement with brokers and other documents including details of brokerage income declared by them in their return of Regarding the amount of interest on loan of which according to the Assessing Officer pertains to the flats already constructed and leased out and therefore, he directed to reduce the same amount from the work-in-progress. We are of the opinion that interest on loan in respect of leased portion of the building cannot in-progress as same is eligible for deduction u/s 24 of the Act under the head ‘income from house property’. Accordingly, we direct the Assessing Officer to verify if the same has been claimed separately u/s 24 in the computation of income filed . If so, then deduction for the same cannot be allowed -in-progress. However, if no deduction for the interest of the loan u/s 24 of the Act has been allowed to the M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 22 struction. The assessee may file contract agreement with brokers and other documents including details of brokerage income declared by them in their return of Regarding the amount of interest on loan of ₹12,60,020/- which according to the Assessing Officer pertains to the flats already constructed and leased out and therefore, he directed to reduce the progress. We are of the opinion that the building cannot progress as same is eligible for deduction u/s 24 of the Act under the head ‘income from house property’. Accordingly, we direct the Assessing Officer to verify if the same has e computation of income filed then deduction for the same cannot be allowed progress. However, if no deduction for the interest of the loan u/s 24 of the Act has been allowed to the assessee, then deduction for ₹1,12,00,020/- should be allowed under the head ‘income from house property’ declared by the assessee. The issue is accordingly allowed for statistical purposes. 18.2 Amount of expenditure ,which has been reduced by the Assessing Officer out of work progress. According to the Assessing Officer entire amount pertains to the leased part of the building and therefore, same is eligible for deduction u/s 24 of the Act under the head ‘income f property’ and therefore cannot be allowed to be included in closing work-in-progress. We are of the opinion that Assessing Officer must verify the payment of the municipal taxes relates to which part of the building. If same pertains to the lease he is directed to allow the same under the head ‘income from house property’ and if the said municipal taxes pertains to under construction part of the buildi ITA Nos. 1851 & 1846/M/2021 then deduction for the corresponding amount of should be allowed under the head ‘income from house property’ declared by the assessee. The issue is accordingly allowed for statistical purposes. Amount of expenditure of ₹3 lacs relates to municipal taxes which has been reduced by the Assessing Officer out of work progress. According to the Assessing Officer entire amount pertains to the leased part of the building and therefore, same is eligible for deduction u/s 24 of the Act under the head ‘income f property’ and therefore cannot be allowed to be included in closing progress. We are of the opinion that Assessing Officer must verify the payment of the municipal taxes relates to which part of the building. If same pertains to the leased part of the building he is directed to allow the same under the head ‘income from house property’ and if the said municipal taxes pertains to under construction part of the building, then same is directed allowed part M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 23 the corresponding amount of should be allowed under the head ‘income from house property’ declared by the assessee. The issue is accordingly relates to municipal taxes which has been reduced by the Assessing Officer out of work-in- progress. According to the Assessing Officer entire amount pertains to the leased part of the building and therefore, same is eligible for deduction u/s 24 of the Act under the head ‘income from house property’ and therefore cannot be allowed to be included in closing progress. We are of the opinion that Assessing Officer must verify the payment of the municipal taxes relates to which part of d part of the building, then he is directed to allow the same under the head ‘income from house property’ and if the said municipal taxes pertains to under then same is directed allowed part of work-in-progress. The iss purposes. 19. The next issue is regarding material and maintenance and over head expenses of ₹ reduced out of work under: S. No. Head expenses 1. House keeping charges 2. Fire fighting work 3. Infra Dev. Charges 4. Security expense 20. According to assessee, building and it was not possible to bifurcate the expenses towards the leased building. The contention of the assessee these are incurred for the construction work whatever benefit to the leased building therefore entire expenses are eligible for closing work We find that the issue in dispute is what proportion of the ITA Nos. 1851 & 1846/M/2021 progress. The issue is accordingly allowed for statistical The next issue is regarding material and maintenance and over ₹7,16,027/- which the Assessing officer has reduced out of work-in-progress. The details of Head expenses Total expense Disallowance @ 23.75 per cent House keeping charges 7,212 1713 Fire fighting work 19,01,526 4,51,612/- Infra Dev. Charges 6,63,804/- 1,57,653 Security expense 4,42,312/- 1,05,049/- 30,14,854 7,16,027/- assessee, these expenses pertain to the entire building and it was not possible to bifurcate the expenses towards the leased building. The contention of the assessee is that these are incurred for the construction work-in whatever benefit to the leased building is unintentional therefore entire expenses are eligible for closing work issue in dispute is what proportion of the M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 24 ue is accordingly allowed for statistical The next issue is regarding material and maintenance and over which the Assessing officer has details of expesnes is as Disallowance @ 23.75 per cent these expenses pertain to the entire building and it was not possible to bifurcate the expenses towards is that primarily in-progress and is unintentional and therefore entire expenses are eligible for closing work-in-progress. issue in dispute is what proportion of the expenses relate to the leased building. bills and vouchers and other documents, although may not be with precise accuracy but may be with some estimate. Therefore, this issue is also restored to the file of the Assessing Officer ground of the appeal of the Revenue i purposes. 21. In the result, the ground are accordingly allowed for statistical purposes 22. Now we take up the appeal of the assessee for AY 2010 far as grounds of the appeal of the assessee for AY 2010 concerned same are assessee for AY 2008 2008-09 this ground of appeal is decided ground of appeal of the assessee is dismissed. ITA Nos. 1851 & 1846/M/2021 to the leased building. This is a matter of verification from the bills and vouchers and other documents, although may not be with precise accuracy but may be with some estimate. Therefore, this issue is also restored to the file of the Assessing Officer ground of the appeal of the Revenue is allowed for statistical In the result, the grounds No. 1 and 2 appeal allowed for statistical purposes. Now we take up the appeal of the assessee for AY 2010 of the appeal of the assessee for AY 2010 are identical to ground decided in the case of the assessee for AY 2008-09, therefore, following our finding in AY 09 this ground of appeal is decided mutatis mutandis peal of the assessee is dismissed. M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 25 ification from the bills and vouchers and other documents, although may not be with precise accuracy but may be with some estimate. Therefore, this issue is also restored to the file of the Assessing Officer. Thus, the s allowed for statistical No. 1 and 2 appeal of the Revenue Now we take up the appeal of the assessee for AY 2010-11. As of the appeal of the assessee for AY 2010-11 are identical to ground decided in the case of the 09, therefore, following our finding in AY mutatis mutandis. This 23. In the result, the are allowed for statistical purposes Order pronounced in the open Court in Sd/- (KAVITHA RAJAGOPAL JUDICIAL MEMBER Mumbai; Dated: 27/10/2022 Dragon Legal / Rahul Sharma, Sr. P.S. 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. //True Copy// ITA Nos. 1851 & 1846/M/2021 In the result, the appeals of the assessee and allowed for statistical purposes. ounced in the open Court in 27/10 sd/- KAVITHA RAJAGOPAL) (OM PRAKASH KANT MEMBER ACCOUNTANT Copy of the Order forwarded to : BY ORDER, (Sr. Private Secretary) ITAT, Mumbai M/s Alpha Associates ITA Nos. 1851 & 1846/M/2021 26 appeals of the assessee and by the Revenue 10/2022. OM PRAKASH KANT) MEMBER BY ORDER, (Sr. Private Secretary) ITAT, Mumbai