ITO 27 (1)(4), MUMBAI V. DHAVAL & COMPANY, MUMBAI

ITA 1872/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 8212 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 01-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAMATHA MULLAMUDI
• Keywords: Bogus purchase; Corroborative evidences
• Section: 133(6); 201; 13

Judgement Text

ITA NO. 1872 /MUM/ 2019 ASSESSMENT Y EAR: 2010 - 11 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI SMC BENCH, MUMBAI [CORAM: PRAMOD KUMAR (VICE PRESIDENT) ] ITA NO. 1872 /MUM/ 2019 ASSESSMENT YEAR: 2010 - 11 INCOME TAX OFFICER 27 (1)(4) .APPELLANT MUMBAI VS M/S. DAWAL& COMPANY ..........RESPONDENT 353/B - 12, 2 ND FLOOR, JAY BANDHU SOCIETY, 90 FEET ROAD, GHATKOPAR (E), MUMBAI 400 077 [PAN: AAAFD1095L ] APPEARANCES BY SAMATHAMULLAMUDI FOR THE APPELLANT RAJESH SHAH FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : JUNE 10 TH , 20 20 DATE OF PRONOUNCEMENT : JULY 13 TH , 20 20 ORDER PER PRAMOD KUMAR, VP: BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 17 TH JANUARY 2019, PASSED BY THE LEARNED CIT(A) - 25 , MUMBAI FOR THE ASSESSMENT YEAR 201 0 - 1 1 . 2. GRIEVANCES RAISED BY THE ASSESSING OFFICER ARE AS FOLLOWS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DIRECTING THE AO TO RESTRICT THE ADDITION TO 5% OF RS. 20,05,036/ - AS AGAINST 12.5% ADD ITION OF RS. 20,05,036/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF BOGUS PURCHASES, WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAD FAILED TO DISCHARGE THE ONUS TO ESTABLISH THE GENUINENESS OF THE TRANSACTIONS AND ALSO FAILED TO FURNISH CORROBORATIVE EVIDENCES IN SUPPORT OF THE CLAIM. ITA NO. 1872 /MUM/ 2019 ASSESSMENT Y EAR: 2010 - 11 PAGE 2 OF 3 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN ESTIMATING THE PROFIT FROM HAWALA PURCHASES BY DISALLOWING ONLY RS . 1,00,251/ - BEING 5% OF THE BOGUS PURCHASES AS EVEN THE PUBLIC ONUS OF PRODUCING THE DOCUMENTARY EVIDENCES WERE NOT FULFILLED BY THE ASSESSEE. 3. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUND BE REVERSED AND THAT OF THE ASSESSING O FFICER BE RESTORED. 3. EVEN THOUGH THE ISSUES RAISED IN THIS APPEAL ARE ADMITTEDLY COVERED BY THE DECISION OF COORDINATE BENCH DATED 17 TH JANUARY 2020, IN ASSESSEE OWN CASE FOR THE ASSESSMENT YEAR 2009 - 10. WE HOWEVER SEE NO REASONS TO TAKE ANY VIEW OF THE MATTER THEN THE VIEW TAKEN BY THE COORDINATE BENCH IN THE AFORESAID DECISION WHEREIN THE COORDINATE BENCH HAS INTER ALIA OBSERVED AS FOLLOWS: - 6. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL ON RECORD. IT IS EVIDENT, IN THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAD FURNISHED VARIOUS DOCUMENTARY EVIDENCES SUCH AS PURCHASE BILLS, LEDGER ACCOUNT COPIES, BANK STATEMENT, STOCK STATEMENT WITH QUANTITATIVE DETAILS OF PURC HASE AND CORRESPONDING SALES, SALES BILLS, ETC. THE ASSESSING OFFICER TREATED THE PURCHASES AS NON GENUINE PRIMARILY FOR THE REASON THAT THE ASSESSEE COULD NOT FURNISH ANY DELIVERY CHALLAN AND TRANSPORT RECEIPT. FURTHER, NOTICE ISSUED UNDER SECTION 133(6) OF THE ACT RETURNED BACK UN SERVED. HOWEVER, THE ASSESSING OFFICER HAS ACCEPTED THAT THE DISPUTED PURCHASES HAVE BEEN MADE BY THE ASSESSEE, THOUGH, NOT FROM THE DECLARED SOURCE. FOR THIS REASON ALONE, THE ASSESSING OFFICER HAS ONLY ADDED THE PROFIT ELEMENT EMBEDDED IN SUCH PURCHASES. WHEREAS, LEARNED COMMISSIONER (APPEALS) HAS DIRECTED THE ASSESSING OFFICER TO SET OFF THE GROSS PROFIT ALREADY DECLARED AGAINST THE PROFIT ELEMENT ESTIMATED AT 12.5%. SINCE, THE ASSESSEE HAS ALREADY INCLUDED THE PURCHASES IN IT S ACCOUNT AND OFFERED THE PROFIT DERIVED THERE FROM IN NORMAL COURSE, IT HAS TO BE GIVEN SET OFF OF SUCH PROFIT DECLARED AGAINST THE PROFIT ESTIMATED ON THE ALLEGED NON GENUINE PURCHASES. IN OUR VIEW, THE AFORESAID DECISION OF LEARNED COMMISSIONER (APPEALS ) IS JUST AND PROPER, HENCE, DOES NOT REQUIRE ANY INTERFERENCE. ACCORDINGLY, WE UPHOLD THE DECISION OF LEARNED COMMISSIONER (APPEALS). GROUND RAISED IS DISMISSED. 4 . LEARNED REPRESENTATIVE HAS ALSO FAIRLY AGREED THAT THE ISSUES RAISED ON THIS APPEAL ARE S QUARELY COVERED BY THE AFORESAID DECISION. WE SEE NO REASONS TO TAKE ANY OTHER VIEW OF THE MATTER THEN THE VIEW SO TAKEN BY THE COORDINATE BENCH. ITA NO. 1872 /MUM/ 2019 ASSESSMENT Y EAR: 2010 - 11 PAGE 3 OF 3 5 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED UNDER RULE 34(4) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1962, BY PLACING THE DETAILS ON THE NOTICE BOARD. SD/ - PRAMOD KUMAR (VICE PRESIDENT) MUMBAI, DATED THE 13 TH D AY OF JULY , 2020 NISHANT VERMA SR.PS COPIES TO: (1) THE APPLICANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, MUMBAI