Income-tax Officer, V. Shri Ashok Fulchand Kothari, Ahmednagar

ITA 1984/PUN/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9608 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 4 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 06-12-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 08-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HITENDRA NINAWE
• Keywords: Bogus purchase; Rule of consistency; Additional evidence; Accommodation entries
• Section: 143(3); 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E , ! ' # , $% &' #' , ' # '( BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI VIKAS AWAS THY, JM '%. / ITA NO. 1879/PUN/2013 * +* / ASSESSMENT YEAR : 2007-08 SHRI ASHOK FULCHAND KOTHARI, PROP : KOTHARI GANDHI & COMPANY, MARKET YARD, AHMEDNAGAR PAN : ACTPK5334Q ....... / APPELLANT /VS. DY. COMMISSIONER OF INCOME TAX, AHMEDNAGAR CIRCLE, AHMEDNAGAR / RESPONDENT '%. / ITA NO. 1984/PUN/2013 * +* / ASSESSMENT YEAR : 2007-08 INCOME TAX OFFICER, WARD 1, AAYAKAR BHAVAN, BEHIND NATRAJ HOTEL, AURANGABAD ROAD, AHMEDNAGAR ....... / APPELLANT /VS. SHRI ASHOK FULCHAND KOTHARI, PROP : KOTHARI GANDHI & COMPANY, MARKET YARD, AHMEDNAGAR PAN : ACTPK5334Q / RESPONDENT 2 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 ,-( '%. / CO NO. 92/PUN/2014 * +* / ASSESSMENT YEAR : 2007-08 SHRI ASHOK FULCHAND KOTHARI, PROP : KOTHARI GANDHI & COMPANY, MARKET YARD, AHMEDNAGAR PAN : ACTPK5334Q ....... / APPELLANT / V/S. INCOME TAX OFFICER, WARD 1, AAYAKAR BHAVAN, BEHIND NATRAJ HOTEL, AURANGABAD ROAD, AHMEDNAGAR / RESPONDENT ASSESSEE BY : SHRI S.N. PURANIK REVENUE BY : SHRI HITENDRA NINAWE / DATE OF HEARING : 13-02-2017 / DATE OF PRONOUNCEMENT : 06-04-2017 . / ORDER PER VIKAS AWASTHY, JM : THESE CROSS APPEALS BY THE ASSESSEE AND THE DEPARTM ENT AND CROSS OBJECTIONS BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-IT/TP, PUNE DATED 19 -08-2013 FOR THE ASSESSMENT YEAR 2007-08. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RECORD S ARE: THE ASSESSEE IS AN INDIVIDUAL AND IS ENGAGED IN THE BUSINESS OF TRADING IN CHILIES, DHANIA ETC. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE 3 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 IMPUGNED ASSESSMENT YEAR ON 31-10-2007 DECLARING TOTAL INCOME AS ` 7,36,264/-. THE CASE OF ASSESSEE WAS SELECTED FOR SCRUTIN Y. ACCORDINGLY, STATUTORY NOTICE U/S. 143(2) OF THE INCOME TA X ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS ISSUED AND SER VED ON THE ASSESSEE. DURING THE COURSE OF SCRUTINY ASSESSMENT PRO CEEDINGS, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS TOTAL T URNOVER OF ` 4,68,59,746/-, THE ASSESSEE HAD DECLARED GROSS PROFIT OF ` 19,84,000/- AND NET PROFIT AT ` 8,20,631/-. THUS, THE GROSS PROFIT RATIO WAS DETERMINED AT 4.32% AND THE NET PROFIT AT 1.75%. THE ASS ESSING OFFICER SUSPECTED THAT BOOKS OF THE ASSESSEE REQUIRE DETAILED V ERIFICATION. THE ASSESSING OFFICER IMPOUNDED THE BOOKS OF ASSESSEE U/S. 131 OF THE ACT. AFTER VERIFICATION OF THE BOOKS, THE ASSESSING OFFICER CONCLUDE D THAT THE ASSESSEE HAD INFLATED PURCHASE OF CHILIES FROM ONE M/S. GANG ABISAN MURLIDHAR MINIYAR. THUS, FROM THE TOTAL ALLEGED PURCHASE OF CHILIES TO THE TUNE OF ` 2,38,23,371/-, THE ASSESSING OFFICER DISALLOWED 20% I.E. ` 47,64,674/- AS BOGUS PURCHASES. FURTHER, THE ASSESSING OFFICER DISALLOWED A SUM OF ` 3,61,850/- U/S. 68 OF THE ACT CREDITED IN THE NAME OF MRS. POONAM GUNDECHA, DAUGHTER OF THE ASSESSEE. AGGRIEVED BY THE ASSESSMENT ORDER DATED 27-11-2009, T HE ASSESSEE FILED APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) ASSAILING BOTH THE ADDITIONS. THE COMMISSIONER OF INCOME TA X (APPEALS) PARTLY ACCEPTED THE APPEAL OF THE ASSESSEE AND REDUCED ADDITION ON ACCOUNT OF INFLATED PURCHASES FROM ` 47,64,674/- TO ` 10,23,423/-, THEREBY GRANTING RELIEF OF ` 37,41,251/- TO THE ASSESSEE. IN RESPECT OF SECOND ADDITION OF ` 3,61,850/- U/S. 68 OF THE ACT, THE COMMISSIONER OF INCOME TAX (APPEALS) RESTRICTED THE ADDITIO N TO ` 72,000/- AFTER GRANTING RELIEF OF ` 2,89,850/- TO THE ASSESSEE. AGAINST THESE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS), B OTH, THE 4 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 ASSESSEE AND THE DEPARTMENT ARE IN APPEAL BEFORE THE T RIBUNAL. THE ASSESSEE HAS ALSO FILED CROSS OBJECTIONS IN THE APPEAL FILE D BY THE DEPARTMENT SUPPORTING THE FINDINGS OF COMMISSIONER OF INCOM E TAX (APPEALS) IN RESPECT OF RELIEF GRANTED. 3. SHRI HITENDRA NINAWE REPRESENTING THE DEPARTMENT SUB MITTED THAT VERIFICATION OF BOOKS OF ACCOUNT OF THE ASSESSEE REVE AL THAT THE ASSESSEE HAS MADE PURCHASES OF CHILIES TO THE TUNE OF ` 2,38,23,371/- FROM ONE M/S. GANGABISAN MURLIDHAR MINIYAR. FROM THE BOOK S OF ACCOUNT IT WAS FOUND THAT ON VARIOUS DATES PURCHASES W ERE MADE, HOWEVER, NO INCIDENTAL EXPENSES SUCH AS LOADING/UNLOADING OR TRANSPORT ETC. WERE DEBITED. FURTHER, THE VOUCHERS CALLE D BICHAIT ISSUED BY M/S. GANGABISAN MURLIDHAR MINIYAR ON VARIOUS OCC ASIONS WERE FOUND TO BE NOT SERIALLY ISSUED. THE LD. DR CITED THE INSTANCES FROM THE ASSESSMENT ORDER THAT THE BICHAIT NO. 8554 WAS ISSUED ON 01-12-2006, WHERE AS THE SUBSEQUENT BICHAIT NO. 8555 WAS ISSUED ON EARLIER DATE I.E. ON 04-10-2006. IN ANOTHER INSTANCES, BICHAIT NO. 8557 WAS DATED 23-06-2006 AND BICHAIT NO. 8556 AND 8559 WERE DATED 02-12-2006 AND 01-12-2006, RESPECTIVELY. THE LD. DR POIN TED THAT A PERUSAL OF DOCUMENTS ON RECORD CLEARLY SHOW THAT THE A SSESSEE HAD PROCURED INVOICES FROM M/S. GANGABISAN MURLIDHAR MINIYAR TO INFLATE HIS PURCHASES AND HAS THEREBY REDUCED HIS PROFIT MARGIN. THE LD. DR FURTHER REFERRING TO ONE OF THE INVOICES AT PAGE 259 OF TH E PAPER BOOK SUBMITTED THAT A PERUSAL OF DOCUMENT SHOW THAT IT RELATE S TO ALLEGED PAYMENT MADE BY THE ASSESSEE FOR PURCHASE OF CHILIES. HO WEVER, THERE IS NO PAYMENT FOR LOADING/UNLOADING OR TRANSPORTATION WHICH IS INCIDENTAL TO PURCHASE OF CHILIES. THE ASSESSEE AND M/S. GA NGABISAN MURLIDHAR MINIYAR ARE CARRYING THEIR TRADING BUSINESS FROM MARKET 5 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 YARD. FOR EVERY WHOLESALE TRANSACTION CARRIED OUT IN TH E PREMISES OF MARKET YARD, THE COMMISSION AGENTS HAVE TO PAY APMC FEE S BUT THERE IS NO DOCUMENT ON RECORD TO SHOW THAT ANY FEES WAS PA ID BY THE ASSESSEE FOR THE PURCHASES MADE FROM M/S. GANGABISAN MU RLIDHAR MINIYAR. THE LD. DR FURTHER REFERRED TO ONE RECEIPT PLACED ON RECORD BY THE ASSESSEE AT PAGE 121 OF THE PAPER BOOK. THE SAID RECEIPT HAS BEEN ISSUED BY MEGHANAND COLD STORAGE PVT. LTD. THE LD. DR PO INTED THAT THE SAID RECEIPT ONLY SHOW THE NUMBERS OF BAGS AND THE ITEM. NO INCIDENTAL CHARGES SUCH AS TRANSPORTATION OR LOADING/UNLOADING CHA RGES ARE SPECIFIED IN THE SAID RECEIPT. FURTHER, THERE IS NO OTH ER RECEIPT OR BILL TO SHOW THAT THE ASSESSEE HAS PAID LOADING/UNLOADING O R TRANSPORTATION CHARGES. THESE DOCUMENTS ON RECORD CLE ARLY INDICATE THAT THE ASSESSEE HAS PROCURED BILLS TO INFLATE THE PURCH ASES. THE LD. DR VEHEMENTLY DEFENDED THE ORDER OF ASSESSING OFFICER AN D PRAYED FOR SETTING ASIDE THE IMPUGNED ORDER. 4. ON THE OTHER HAND SHRI S.N. PURANIK APPEARING ON BEHA LF OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS NOT A COMMISSIO N AGENT BUT A TRADER. THE ASSESSEE PURCHASES GOODS THROUGH AUCTION IN MARKET YARD AND SELL THE SAME THROUGH AUCTION IN MARKET YARD. SOMET IMES THE ITEMS ARE PURCHASED AND SOLD EVEN WITHOUT TAKING PHYSICA L POSSESSION OF THE GOODS. M/S. GANGABISAN MURLIDHAR MINIYAR IS A KACCHA ADATYA . HE IS A CONDUIT BETWEEN FARMERS AND THE ASSESSEE. THE ASSESSEE PURCHASES CHILI FROM M/S. GANGABISAN MURLIDHAR MINIYAR THROU GH AUCTION AND SELL THE SAME IN THE MARKET YARD WITHOUT TAKING PO SSESSION OF THE GOODS. THUS, IN SUCH TRANSACTIONS THE ASSESSEE D OES NOT INCUR LOADING/UNLOADING CHARGES OR TRANSPORTATION CHARGES. THE LD. AR REFERRING TO THE DOCUMENT AT PAGE 259 OF THE PAPER BOO K SUBMITTED THAT 6 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 IT IS NOT A BILL OR INVOICE, IT IS A STATEMENT OF ACCOUNTS. T HE LD. AR SUBMITTED THAT A CLOSE PERUSAL OF THE DOCUMENT WOULD REV EAL THAT IN THE RIGHT COLUMN THE PAYMENTS MADE FOR PROCURING THE GOODS AND THE MODE OF PAYMENT IS MENTIONED. SUBSTANTIAL PAYMENTS HAVE BEEN MADE THROUGH CHEQUES AND ONLY A SMALL PART OF THE PAYMENT HAS BEEN MADE IN CASH. 4.1 THE LD. AR CONTENDED THAT BOOKS OF THE ASSESSEE WE RE IMPOUNDED DURING THE COURSE OF ASSESSMENT PROCEEDINGS ON 18-06-2 009. THE ASSESSEE WAS NOT HAVING ACCESS TO HIS BOOKS OF ACCOUNT DURING ASSESSMENT. THEREFORE, THE ASSESSEE COULD NOT GIVE THE ENTIRE DETAILS OF THE PURCHASES MADE. THE LD. AR REFERRING TO THE INVOICES AT PAGES 431, 435 AND 441 OF THE PAPER BOOK SUBMITTED THAT A PERUSA L OF INVOICES ISSUED BY M/S. GANGABISAN MURLIDHAR MINIYAR WOULD REVEAL TH AT APART FROM THE PAYMENT FOR PURCHASES MADE, PAYMENT FOR HAMALI C HARGES, CESS, SUPERVISION CHARGES, MARKET FUND AND PARKING CHARGE S HAVE ALSO BEEN PAID. THE LD. AR CONTENDED THAT THESE ARE SOME OF THE INSTANCES TO SHOW THAT INCIDENTAL EXPENSES WERE PAID BY THE ASSES SEE, WHERE THE ASSESSEE HAD TAKEN POSSESSION OF THE GOODS PURCHASED. THE LD. AR POINTED THAT THE ASSESSING OFFICER HAD IN AN ARBITRARY AND UNJUSTIFIED MANNER ESTIMATED BOGUS PURCHASES AT 20% OF THE TOTAL P URCHASES MADE BY THE ASSESSEE. THE COMMISSIONER OF INCOME TAX (APPEALS ) CONFIRMED THE ADDITION TO THE TUNE OF ` 10,23,421/- ON THE BASIS OF ADDITION MADE IN THE CASE OF M/S. GANGABISAN MURLIDHAR MINIYAR. THE ADDIT ION IN THE CASE OF M/S. GANGABISAN MURLIDHAR MINIYAR WAS MADE AS TH E ASSESSEE COULD NOT FURNISH THE CERTIFICATE FROM APMC CONFIRMING THE FA CTS. THE ASSESSEE PRODUCED THE CERTIFICATE FROM APMC DURING REMA ND PROCEEDINGS. THE ASSESSING OFFICER AFTER EXAMINING THE SAME HAS 7 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 RAISED DOUBTS OVER 9 INSTANCES OUT OF 28 CITED BY THE ASSESSEE. THE DOUBT WAS RAISED BY THE ASSESSING OFFICER ONLY FOR THE RE ASON THAT THE ASSESSING OFFICER COULD NOT ASCERTAIN FROM THE DOCUMENTS W HETHER ON THOSE 9 BILLS CESS AND SUPERVISION FEES WAS PAID OR NOT. T HE LD. AR POINTED THAT EVEN SUCH DOUBT RAISED BY THE ASSESSING O FFICER ON THOSE 9 BILLS WAS UNWARRANTED AS THE CERTIFICATE CLEARLY STATES TH AT CESS AND SUPERVISION FEES WAS PAID EARLIER. THE LD. AR FILED ADDITIONAL EV IDENCE WHICH INCLUDE THE STATEMENT OF 28 BILLS IDENTIFIED BY THE ASSE SSING OFFICER IN THE CASE OF M/S. GANGABISAN MURLIDHAR MINIYAR WHER E APMC HAS CERTIFIED THAT CESS HAS BEEN PAID THOUGH APMC, KATAPATTI WAS NOT ISSUED. THE ASSESSEE HAS ALSO PLACED ON RECORD A STATE MENT OF FURTHER SALE OF CHILLY PURCHASES THROUGH THOSE 28 BILLS FROM M/S. GA NGABISAN MURLIDHAR MINIYAR. THE LD. AR SUBMITTED THAT THESE DOCUM ENTS FURNISHED BY THE ASSESSEE AS ADDITIONAL EVIDENCE ARE CLINCH ING EVIDENCE TO NEGATE ALLEGATION OF BOGUS OR ACCOMMODATION BILLS. THE P URCHASE BILLS ARE FURTHER REPRESENTED BY SALES. THE PURCHASE AND SALE OF CHILLY IS SUBSTANTIATED BY DAY TO DAY QUANTITY STOCK RECORD M AINTAINED BY THE ASSESSEE. THE ASSESSEE HAD FURNISHED AUDITED ACCOUNTS AND STOCK REGISTER BEFORE THE ASSESSING OFFICER. THE ASSESSING OFFICER HAS VERIFIED THE SAME AND NO DEFECT WAS POINTED BY THE ASSESSING OFFICER. 4.2 THE LD. AR SUBMITTED THAT THE COMMISSIONER OF INCOME T AX (APPEALS) WHILE CONFIRMING THE ADDITION OF ` 10,23,422/- HAS FAILED TO REFER TO THE REMAND REPORT. A PERUSAL OF THE IMPUGNED ORDER SHOWS TH AT THERE IS NO REFERENCE TO THE REMAND REPORT IN THE ORDE R BY THE COMMISSIONER OF INCOME TAX (APPEALS). THE LD. AR POINTED TH AT THE ADDITION OF ` 10,23,422/- HAS BEEN MADE MERELY ON ACCOUNT OF SUSPICION. THERE IS NO DOCUMENT ON RECORD TO ESTABLISH THAT THE 8 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 ASSESSEE HAS SHOWN BOGUS PURCHASES OR HAS PROCURED ACCOMMODATION ENTRIES FROM M/S. GANGABISAN MURLIDHAR MINIYAR. THE ASSESS ING OFFICER HAS MADE ADDITION ON MERE ESTIMATION WITHOUT REJECT ING THE BOOKS OF THE ASSESSEE OR EVEN WITHOUT REFERRING TO THE COMPLETE SET OF DOCUMENTS. THE LD. AR PRAYED FOR MODIFYING THE ORDER OF C OMMISSIONER OF INCOME TAX (APPEALS) BY DELETING THE PART OF ADDITION CON FIRMED BY THE COMMISSIONER OF INCOME TAX (APPEALS). THE LD. AR IN SUPPORT OF HIS SUBMISSIONS PLACED RELIANCE ON THE DECISION OF CO-ORDINATE B ENCH OF THE TRIBUNAL IN THE CASE OF SIDDARTH ENGINEERING CORPORATIO N VS. ASSTT. COMMISSIONER OF INCOME TAX IN ITA NO. 1502/PN/2013 FOR AS SESSMENT YEAR 2009-10 DECIDED ON 29-12-2015. 4.3 IN RESPECT OF GROUND NO. 2 RELATING TO CONFIRMING THE A DDITION OF ` 72,000/-, THE LD. AR SUBMITTED THAT SMT. POONAM GUNDECHA IS THE DAUGHTER OF ASSESSEE AND SHE IS ASSISTING THE ASSESSEE IN HIS BUSINESS. THE ASSESSEE IS PAYING MEAGER SALARY OF ` 72,000/- PER ANNUM TO HER. THE ASSESSING OFFICER HAS ALLOWED THE PAYMENT OF SALARY TO SMT. POONAM GUNDECHA IN EARLIER YEARS AND EVEN IN THE SUBSEQ UENT ASSESSMENT YEAR WITHOUT RAISING ANY OBJECTION. IT IS ONL Y IN ASSESSMENT YEAR UNDER APPEAL THAT DISALLOWANCE WAS MADE BY ASSESSING OFFICER AND THE SAME HAS BEEN CONFIRMED BY THE COMMISSIONER OF INCO ME TAX (APPEALS) IN A MECHANICAL MANNER. 5. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESEN TATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORITIE S BELOW. WE HAVE ALSO CONSIDERED VARIOUS DOCUMENTS ON WHICH BOTH SID ES HAVE PLACED RELIANCE. THE ASSESSEE IN HIS APPEAL HAS ASSAILED TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) ON TWO GROUNDS : 9 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 I. CONFIRMING THE DISALLOWANCE OF PURCHASES OF ` 10,23,422/-, AND II. DISALLOWANCE OF ` 72,000/- IN RESPECT OF SALARY PAID TO SMT. POONAM GUNDECHA. THE DEPARTMENT IN APPEAL HAS ASSAILED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN RESTRICTING THE ADD ITION OF ` 47,64,674/- TO ` 10,23,423/- IN RESPECT OF ALLEGED INFLATED PURCHASES BY THE ASSESSEE. 6. WE WILL FIRST TAKE THE APPEAL OF DEPARTMENT. THE ASSESS ING OFFICER HAS ESTIMATED 20% OF THE TOTAL PURCHASES MADE BY THE ASSESSEE FROM M/S. GANGABISAN MURLIDHAR MINIYAR HAS BOGUS. THE FIRS T APPELLATE AUTHORITY HAS RESTRICTED THE ADDITION OF ` 47,64,674/- MADE BY ASSESSING OFFICER TO ` 10,23,423/- ON THE BASIS OF THE ASSESSMENT ORDER PASSED IN THE CASE OF M/S. GANGABISAN MURLIDHAR MINIYAR. THE ASSESSING OFFICER IN THE CASE OF M/S. GANGABISAN MURLIDHAR M INIYAR HAS HELD THAT THE ASSESSEE (GANGABISAN MURLIDHAR MINIYAR) COULD NOT PRODUCE ANY EVIDENCE TO ESTABLISH THAT THERE WERE GENUINE TRAN SACTIONS. THE KATA PATTIES FURNISHED WHICH ARE NOT IN THE NAME OF KRUSHI UTPANNA BAZAR SAMITEE CANNOT BE ACCEPTED AS TRUE AND GENUINE. THE TRANSACTIONS CLAIMED THROUGH SUCH KATA PATTIES ARE DUBIOUS AND NON- GENUINE PURCHASES. THE ASSESSEE HAS PROVIDED ACCOMMOD ATION ENTRIES TO SHRI ASHOK KOTHARI. THUS, THE ASSESSING OFFICER TREATED ENTRIES TO THE TUNE OF ` 10,23,422/- AS NON-GENUINE AND ACCOMMODATION ENTRIES GIVEN ON PAPER WITHOUT ANY BASIS. THE ASSESSING OFFICER IN THE CASE OF M/S. GANGABISAN MURLIDHAR MINIYAR TREATED ` 10,23,422/- AS INFLATED EXPENDITURE AND BOGUS ACCOMMODATION ENTRIES GIVEN TO SH RI ASHOK KOTHARI WITH INTENTION TO REDUCE PROFIT AND MARGIN. 10 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 THE COMMISSIONER OF INCOME TAX (APPEALS) IN THE CASE OF ASSESSEE HELD THAT SINCE, THE ADDITION MADE IN THE CASE O F M/S. GANGABISAN MURLIDHAR MINIYAR IS ` 10,23,422/- AND IN THE CASE OF ASSESSEE IT IS ONLY THE PURCHASES MADE THROUGH M/S. GA NGABISAN MURLIDHAR MINIYAR WHICH HAVE BEEN DOUBTED, THEREFORE, SIMILA R AMOUNT HAS TO BE DISALLOWED IN THE CASE OF ASSESSEE BY TREATING THE TRANSACTION AS NON-GENUINE. WE FIND MERIT IN THE CONCLUSION DRAWN BY THE COMMISSIONER OF INCOME TAX (APPEALS). THE ASSESSING OFFICER HAS ESTIMATED 20% OF THE TOTAL TRANSACTION AS DUBIOUS OR NO N-GENUINE WITHOUT ANY BASIS, WITHOUT REJECTING BOOKS OF THE ASSESSE E. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY MERIT IN THE APPEAL FILED BY T HE DEPARTMENT, ACCORDINGLY, THE SAME IS DISMISSED. 7. THE ASSESSEE HAS FILED CROSS OBJECTIONS SUPPORTING T HE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) TO THE EXTENT DELETING THE ADDITIONS MADE ON ACCOUNT OF NON-GENUINE PURCHASES. SINC E, THE APPEAL OF THE DEPARTMENT HAS BEEN DISMISSED, THE CROSS O BJECTIONS FILED BY THE ASSESSEE HAVE BECOME INFRUCTUOUS AND ARE DISMISSED AS SU CH. 8. THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT THE AS SESSEE COULD NOT FURNISH ENTIRE DETAILS OF THE PURCHASE TRANSACTIONS AT THE TIME OF ASSESSMENT, AS THE BOOKS OF ASSESSEE WERE IMPOUNDED U/ S. 131 OF THE ACT. IN THE ABSENCE OF COMPLETE DETAILS THE ASSESSEE CO ULD NOT SUBSTANTIATE HIS SUBMISSIONS WITH RELEVANT MATERIAL. THE A SSESSEE HAS FILED ADDITIONAL EVIDENCE IN SUPPORT OF HIS CONTENTIONS THAT T HE ENTIRE PURCHASES ARE GENUINE AND THE APMC HAS CERTIFIED THAT IN ALL TRANSACTIONS CESS HAS BEEN PAID EVEN THOUGH SOME OF TH E TRANSACTIONS ARE NOT THROUGH APMC, KATAPATTIES . THE LD. AR HAS FURTHER POINTED 11 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS NOT CON SIDERED REMAND REPORT WHEREIN THE ASSESSING OFFICER HAS ONLY RAIS ED DOUBT OVER 9 BILLS OUT OF 28 FURNISHED BY THE ASSESSEE. IN VIEW OF THE FACT THAT THE ASSESSEE HAS FILED ADDITIONAL EVIDENCE TO SUPPORT OF HIS CON TENTIONS. THE LD. AR HAS GIVEN REASONS FOR NOT FURNISHING THESE DOCU MENTS AT THE TIME OF ASSESSMENT. WE ARE SATISFIED THAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FOR NOT FURNISHING THE DOCUMENTS NOW FU RNISHED AS ADDITIONAL EVIDENCE. UNDER SUCH CIRCUMSTANCES, WE DEEM IT APPROPRIATE TO REMIT THIS ISSUE BACK TO THE FILE OF ASSESSIN G OFFICER TO VERIFY THE VERACITY AND RELEVANCE OF THE ADDITIONAL EVIDENC E FILED BY THE ASSESSEE AND THEREAFTER DECIDE THE ISSUE DE-NOVO AFTER CONSIDERING THE SAME AND AFFORDING OPPORTUNITY OF HEARING TO THE ASSESSEE , IN ACCORDANCE WITH LAW. ACCORDINGLY, GROUND NO. 1 RAISED BY THE ASSESSEE IN APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. 9. IN GROUND NO. 2 THE ASSESSEE HAS ASSAILED THE DISALLOW ANCE OF ` 72,000/- PAID BY THE ASSESSEE AS ANNUAL SALARY TO SMT. P OONAM GUNDECHA. IT HAS BEEN CONTENDED THAT SMT. POONAM GUN DECHA DAUGHTER OF THE ASSESSEE IS HELPING THE ASSESSEE IN DAY TO DAY AFFAIRS OF HIS BUSINESS. THE ASSESSEE HAS BEEN PAYING SALARY TO HE R IN THE EARLIER YEARS AND EVEN IN THE SUBSEQUENT YEARS. THE DEPARTME NT HAS NEVER RAISED OBJECTIONS ON PAYMENT OF SAID SALARY EITHER IN THE EARLIER YEARS OR IN THE SUBSEQUENT YEARS. THE LD. DR HAS NOT CONTROVER TED THIS POSITION. THE ASSESSEE HAS FILED COPY OF ASSESSMENT ORDER FOR ASSE SSMENT YEAR 2008-09 DATED 05-08-2010 PASSED U/S. 143(3) OF THE AC T. WE OBSERVE THAT NO SUCH ADDITION HAS BEEN MADE IN THE SUBSEQUENT ASSESSMENT YEAR. WE FIND MERIT IN THE SUBMISSIONS OF THE ASSESSEE. TH E ASSESSING OFFICER HAS TO BE CONSISTENT IN ALLOWING OR DISALLOWING A PARTIC ULAR 12 ITA NOS. 1879 & 1984/PUN/2013 AND CO NO. 92/PUN/2014, A.Y. 2007-08 EXPENDITURE ESPECIALLY WHEN THE EXPENDITURE IS RECURRING IN NATURE. APPLYING THE RULE OF CONSISTENCY, WE ACCEPT GROUND NO. 2 RAISED IN THE APPEAL BY ASSESSEE. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED AND APPEAL OF THE DEPARTMENT AND CROSS OBJECTIONS OF THE AS SESSEE ARE DISMISSED. ORDER PRONOUNCED ON THURSDAY, THE 06 TH DAY OF APRIL, 2017. SD/- SD/- ( / ANIL CHATURVEDI) ( ! / VIKAS AWASTHY) ' ! / ACCOUNTANT MEMBER # ! / JUDICIAL MEMBER ' / PUNE; $% / DATED : 06 TH APRIL, 2017 RK . / ,0& 1&+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. & & ' () / THE CIT(A)-IT/TP, PUNE 4. & & ' / THE CIT-I, PUNE 5. *+ ,- , & ,- , . ./ , ' / DR, ITAT, B BENCH, PUNE. 6. +01 23 / GUARD FILE. // // TRUE COPY// &'4 / BY ORDER, 5 %6 / ASSISTANT REGISTRAR, & ,- , ' / ITAT, PUNE