ITO 26 (2)(7), MUMBAI V. SMT. NIRMALA TUKARAM BOTRE, MUMBAI

ITA 193/MUM/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 3243 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-06-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 07-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY J SETHI LD DR
• Keywords: Bogus purchase

Judgement Text

1 - IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI , , BEFORE HONBLE SHRI VIKAS AWASTHY, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO.193/MUM/2020 ( / ASSESSMENT YEAR: 2009-10) & ./ I.T.A. NO.194/MUM/2020 ( / ASSESSMENT YEAR: 2010-11) INCOME T AX OF FICER - 26(2)(7) ROOM NO.416, 4 TH FLOOR KAUTILYA BHAVAN, G-BLOCK BANDRA KURLA COMPLEX BANDRA (EAST), MUMBAI-400 051. / VS. SMT. NIRMALA TUKARAM BOTRE 3/1, VIVEK NIWAS, SAI BAUG VILLAGE ROAD, BHANDUP (W) MUMBAI-400 078 ./ ./ PAN/GIR N O. AEDPB-3550-M ( + /APPELLANT ) : (./+ / RESPONDENT ) + 0 / APPELLANT BY : SHRI SANJAY J. SETHI - LD.DR ./+ 0/ RESPONDENT BY : NONE / DATE OF HEARING : 14/06/2021 / DATE OF PRONOUNCEMENT : 14/06/2021 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER): - 1. AFORESAID APPEAL BY REVENUE FOR ASSESSMENT YEAR (AY) 2009-10 & 2010-11 CONTEST SEPARATE ORDERS OF LEARNED FIRST AP PELLATE AUTHORITY. HOWEVER, THE FACTS AS WELL AS ISSUE IS QUITE IDENTI CAL IN BOTH THE YEARS AND 2 THEREFORE, THE APPEALS ARE BEING DISPOSED-OFF BY WA Y OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE & BREVITY. THE LEARNED CIT(A) HAS PROVIDED CERTAIN RELIEF TO THE ASSESSEE ON ACCOUNT OF ALLEGED BOGUS PURCHASES. AGGRIEVED, THE REVENUE IS IN FURTHER APPEAL BEFORE US WHEREAS IT APPEARS THAT THE ASSESSEE HAS ACCEPTED THE VERDICT OF LEARN ED FIRST APPELLATE AUTHORITY. 2. THOUGH NONE APPEARED FOR ASSESSEE, HOWEVER, MATE RIAL ON RECORD WAS SUFFICIENT FOR DISPOSAL OF THE APPEAL. THE LD. DR PLEADED FOR RESTORATION OF ASSESSMENT FRAMED BY LD. AO. 3.1 THE MATERIAL FACTS IN AY 2009-10 ARE THAT THE A SSESSEE BEING RESIDENT INDIVIDUAL STATED TO BE ENGAGED IN MANUFACTURING OF CHEMICALS ETC. WAS ASSESSED FOR THE YEAR UNDER CONSIDERATION U/S 143(3 ) R.W.S. 147 ON 07/08/2014. THE ORIGINAL RETURN WAS PROCESSED U/S 1 43(1). PURSUANT TO RECEIPT OF CERTAIN INFORMATION FROM DGIT (INV.) / S ALES TAX DEPARTMENT, MUMBAI, IT TRANSPIRED THAT THE ASSESSEE MADE ALLEGE D BOGUS PURCHASES OF RS.20.29 LACS FROM TWO ENTITIES AS DETAILED IN THE ASSESSMENT ORDER. ACCORDINGLY, THE CASE WAS REOPENED AS PER DUE PROCE SS OF LAW AND THE ASSESSEE WAS DIRECTED TO SUBSTANTIATE THESE PURCHAS ES. 3.2 THOUGH THE ASSESSEE FILED CERTAIN DOCUMENTS, HO WEVER, THE ASSESSEE, IN THE OPINION OF LD. AO, COULD NOT SUBSTANTIATE TH E DELIVERY OF MATERIAL. ACCORDINGLY THE AFORESAID PURCHASES WERE ADDED BACK TO THE INCOME OF THE ASSESSEE U/S 69C. 4. THE ASSESSEE ASSAILED THE IMPUGNED ADDITIONS, IN TER-ALIA, BY SUBMITTING THAT THE PAYMENT TO THE SUPPLIERS WAS TH ROUGH BANKING CHANNELS AND THE SOURCE OF PAYMENT WAS EXPLAINED. THE LD. CI T(A) CONCURRED THAT 3 THERE COULD NOT BE CORRESPONDING SALES WITHOUT PURC HASE OF MATERIAL AND THEREFORE, LD. AO WAS DIRECTED TO ESTIMATE THE ADDI TIONS @12.5% AGAINST THESE PURCHASES. AGGRIEVED, THE REVENUE IS IN FURTH ER APPEAL BEFORE US. 5. GOING BY THE FACTUAL MATRIX AS ENUMERATED IN THE ORDERS OF LOWER AUTHORITIES, WE FIND THAT ASSESSEES SALES TURNOVER WAS NOT IN DOUBT AND THE PAYMENT TO THE SUPPLIERS WAS THROUGH BANKING CH ANNELS. THERE COULD BE NO SALE WITHOUT ACTUAL PURCHASE OF MATERIAL KEEPING IN VIEW THE ASSESSEES NATURE OF BUSINESS. THE FACTS OF THE CASE MADE IT A FIT CASE TO ESTIMATE THE PROFIT ELEMENT EMBEDDED IN THESE TRANSACTIONS. THE LD. CIT(A), AFTER DUE CONSIDERATION OF ASSESSEES SUBMISSIONS, ESTIMATED THE ADDITIONS @12.5% WHICH IS MORE THAN ENOUGH TO TAKE CARE OF THE LEAKA GE OF REVENUE. THEREFORE, THE ESTIMATION COULD NOT BE TERMED AS UN JUSTIFIED, IN ANY MANNER. FINDING NO REASON TO INTERFERE IN THE IMPUGNED ORDE R, WE DISMISS THE APPEAL. 6. THE FACTS ARE SIMILAR IN AY 2010-11 WHEREIN LD. AO DISALLOWED PURCHASES OF RS.22.71 LACS. THE LD. CIT(A) RESTRICT ED THE ADDITIONS TO 12.5% OF THESE PURCHASES. AGGRIEVED, THE REVENUE IS IN FURTHER APPEAL BEFORE US. FACTS BEING PARI-MATERIA THE SAME AS IN AY 2009-10, TAKING THE SAME VIEW, WE DISMISS THE APPEAL. 7. BOTH THE APPEALS STANDS DISMISSED. ORDER PRONOUNCED ON 14 TH JUNE, 2021. SD/- SD/- (VIKAS AWASTHY) (MANOJ KUMAR AGGARWAL) IJ / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; J DATED : 14/06/2021 SR.PS, JAISY VARGHESE 4 01234514 / COPY OF THE ORDER FORWARDED TO : 1. + / THE APPELLANT 2. ./+ / THE RESPONDENT 3. L ( ) / THE CIT(A) 4. L / CIT CONCERNED 5. J MN .J@JJO , JO , / DR, ITAT, MUMBAI 6. NPQR / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.