MOHANLAL KALAJII SUTHAR, Nagpur V. DY, CIT CIR.1, Nagpur

ITA 22/NAG/2017

AI Insights

The case involves Mohanlal Kalaji Suthar, the appellant, who contested the disallowance of commission and brokerage expenses amounting to Rs.21,89,875 for the Assessment Year 2011-12. The disallowance was initially made by the Assessing Officer and upheld by the Commissioner of Income Tax (Appeals). The primary contention in the appeal was the incorrect treatment of these expenses following the disallowance of alleged bogus purchases amounting to Rs.28,70,544 from hawala operators, which were later deleted by the CIT(A). The Tribunal noted the absence of any discussion regarding the commission payments in the assessment order and the lack of an enhancement notice from the CIT(A), leading to the decision to allow the appeal and delete the disallowance.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 133439 (ITAT-NAGPUR)
• Duration Of Justice: 5 year(s) 11 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 13-11-2022
• Assessment Year: 2011-2012
• Appeal Filed On: 19-01-2017
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase
• Section: 143(3)

Judgement Text

आयकर अपीलीय अिधकरण Ɋायपीठ नागपुर मŐ। IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH : NAGPUR BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपीलसं. / ITA No.22/NAG/2017 िनधाᭅरणवषᭅ / Assessment Year : 2011-12 Mohanlal Kalaji Suthar, Vinayaka Metal Indus, Shop No.04, Sai Wadi Sankul, MIDC T Point, Amravati Road, Wadi, Nagpur – 440023. PAN: ARRPS 5022 Q Vs. The Dy.CIT, Circle-1, Nagpur. Appellant/ Assessee Respondent /Revenue Assessee by None. Revenue by Shri G.J.Ninawe – DR Date of hearing 14/11/2022 Date of pronouncement 10/01/2023 आदेश/ ORDER Per S.S.Godara, JM: This assessee’s appeal for Assessment Year 2011-12 is directed against the Commissioner of Income Tax(Appeal)-1, Nagpur’s dated 03.11.2016 in case no.CIT(A)-1/289/2015-16, in proceedings u/s.143(3) of the Income Tax Act, 1961 [in short “the Act”]. Case called twice. None appears at assessee’s behest. He is accordingly proceeded ex-parte. ITA No.22/NAG/2017 for A.Y. 2011-12 Mohanlal Kalaji Suthar [A] 2 2. The assessee appears to have raised a single grievance in his corresponding 7 substantive grounds challenging correctness of the both lower authorities action disallowing commission and brokerage of Rs.21,89,875/- in issue. 3. We note that the assessee’s instant appeal hardly required us to deal the relevant facts at length. We make it clear that the CIT(A)’s order has been passed against the Assessing Officer’s section 143(3) r.w.s 147 assessment only disallowing the alleged bogus purchases of Rs.28,70,544/- sourced from hawala operators. 4. The Revenue at this stage sought to highlight the assessee’s returned income of Rs.27,97,789/- which followed the foregoing bogus purchases as well as the impugned disallowances of commission / brokerage. We find no merit in the Revenue’s instant arguments once the CIT(A)’s detailed decision has already deleted the foregoing bogus purchases forming the sole reason of reopening. This indeed is coupled with the clinching fact that there is no discussion at all in the assessment order herein dealing with the assessee’s commission payments in issue. Nor the CIT(A)’s had given him any enhancement notice to this effect in the lower appellate proceedings. ITA No.22/NAG/2017 for A.Y. 2011-12 Mohanlal Kalaji Suthar [A] 3 5. Faced with this situation, we delete the impugned commission / brokerage disallowance of Rs.21,89,875/- for these precise reasons. Ordered accordingly. 6. This assessee’s appeal is allowed in above terms. Order pronounced in the open court on 10 th January, 2023. Sd/- Sd/- (DR.DIPAK P. RIPOTE) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 10 th Jan, 2023/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, नागपुर बᱶच, नागपुर / DR, ITAT, Bench, Nagpur. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.