SHRI SUNIL GOVIND AGRE, MUMBAI V. INCOME TAX OFFICER -25(3)(4), MUMBAI

ITA 2219/MUM/2018

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 3608 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-03-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: J
• Assessment Year: 2011-2012
• Appeal Filed On: 09-04-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T S KHALSA
• Keywords: Unexplained expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUM BAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI RAM LAL NEGI, JM ITA NO. 2219/MUM/2018 (ASSESSMENT YEAR: 2011-12) SHRI SUNIL GOVIND AGRE ROOM NO.21, PLOT NO. 255, SANKALP SOCIETY, SECTOR 2, CHARKOP KANDIVALI (W), MUMBAI-400 067 VS. ITO-25(3)(4), MUMBAI PAN/GIR NO.AEGPA 0962 H ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : NONE RESPONDENT BY : SHRI T. S. KHALSA DATE OF HEARING : 08.03.2021 DATE OF PRONOUNCEMENT : 09.03.2021 O R D E R PER SHAMIM YAHYA, A. M.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-45, MUMBAI (L D.CIT(A) FOR SHORT) DATED 31.01.2018 AND PERTAINS TO THE ASSESSMENT YEAR (A.Y .) 2011-12. 2. THE GROUNDS OF APPEAL READ AS UNDER: 1. THE HONBLE CIT(A) HAS ERRED IN NOT CONSIDERING THE PRIMARY GROUND OF APPEAL MADE BEFORE HIS HONOR OBJECTING THE ADDITION MADE U/S. 69C, TREATING THE PURCHASES MADE BY THE ASSESSEE AS BOGUS AND UNEXPLA INED IN NATURE. 2. THE HONBLE CIT(A) HAS ERRED IN NOT FOLLOWING TH E PRECEDENCE SET UNDER THE LAW BY THE ITAT. 3. THE HONBLE CIT(A) HAS ERRED IN NOT APPRECIATING THE FACTS THAT THE ASSESSEE HAS SUBMITTED ALL DOCUMENTS AND RECORDS AND THEREFO RE IN THE ABSENCE OF CONTRARY TO THE FACTS PLACED ON RECORD, THE ASSESSEE OUGHT T O RECEIVE THE BENEFIT OF THE CLAIM FOR EXPENDITURE MADE ON ACCOUNT OF ALLEGED BOGUS PU RCHASES. 4. THE HONBLE CIT(A) HAS ERRED IN NOT GIVING THE D UE APPRECIATION ON THE MAIN GROUNDS OF APPEAL AND WITHOUT REJECTING THE SA ME HAS CONSIDERED THE GROUND MADE BY THE ASSESSEE ON AN ALTERNATE AND OPTIONAL G ROUND OF APPEAL. 2 ITA NO. 2219/MUM/2018 (ASSESSMENT YEAR: 2011-12) 3. BRIEF FACTS OF THE CASE ARE THAT DURING THE ASSE SSMENT PROCEEDINGS, THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH DETAILS LIKE LOADING AND UNLOADING CHARGES, TRANSPORTATION DETAILS, COPIES OF DELIVERY CHALLANS , PROOF OF ENTRY IN STOCK REGISTER LEDGER ACCOUNTS OF SELLER PARTIES IN THE BOOKS OF THE ASSE SSEE IN ORDER TO PROVE ITS PURCHASES AND ALSO PRODUCE THE PURCHASE PARTIES FOR VERIFICATION. THE ASSESSEE VIDE LETTER DATED 05.03.2014 HAD PRODUCED COPIES OF PURCHASE BILLS, D ELIVERY CHALLANS, MONTH WISE STOCK RECEIPTS AND ISSUES OF STOCK REGISTER PURCHASE BILL S AND SALES BILLS ALONG WITH PROOF FOR PAYMENT FOR PURCHASES THROUGH BANK. ASSESSEE ALSO P RODUCED CONFIRMATION FROM THE SELLER PARTIES. REGARDING PRODUCING OF PARTIES BEFO RE THE A.O., THE ASSESSEE SUBMITTED THAT HE HAS NO CONTROL OVER THESE PARTIES AFTER SUCH LON G PERIOD. THE A.O. ISSUED NOTICE U/S.133(6) BUT THE NOTICES WERE RETURNED UNSERVED B Y THE POSTAL AUTHORITIES. THE A.O. HELD THAT THE ONUS WAS ON THE ASSESSEE TO PROVE GENUINEN ESS OF PURCHASES, WHICH HE FAILED TO DISCHARGE BY PRODUCING THE PARTIES. THE NOTICES ISS UED BY THE DEPARTMENT WERE RETURNED UNSERVED, THEREFORE, HE TREATED THE ENTIRE PURCHASE S OF RS.85,08,600/- WERE NOT VERIFIABLE AND ADDED AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. 4. UPON THE ASSESSEES APPEAL, THE LD. CIT(A) RELIE D UPON THE CONCLUSION BY THE ASSESSEE AND HELD AS UNDER: 4.7 ASSESSEE IN ITS SUBMISSION BEFORE THE A.O. VIDE LETTER DATED 07.03.2014 AT POINT (G) SUBMITTED THAT WITHOUT PREJUDICE TO HIS A RGUMENTS THAT HIS GROSS PROFIT IS 1.66%, ADDITION AT GP OF 9% MAY BE MADE AS ADDITION AL INCOME. HOWEVER, THE APPELLANT HAS TAKEN AN ALTERNATE GROUND AS UNDER: 5. WITHOUT PREJUDICE TO THE ABOVE, THE ASSESSEE STA TES THAT THE PEAK PURCHASES OF RS.31,50,000/- CAN AT THE MOST BE DETERMINED AS UNEXPLAINED PURCHASES. IT IS NOTICED THAT THE APPELLANT THOUGHT FILED CONFIRMATI ONS OF THE SELLER PARTIES BUT FAILED TO PRODUCE THEM FOR VERIFICATION. NOTICES ISSUED BY THE A.O. WERE NOT SERVED AT THE GIVEN ADDRESSES. EXAMINATION OF THE BANK ACCOUNTS O F THESE PARTIES BY THE A.O. AT THE TIME OF REMAND PROCEEDINGS, IT APPEARED THAT TH E SELLER PARTIES WERE ONLY ROTATING FUNDS IN THEIR ACCOUNTS. AFFIDAVIT FILED B Y THE APPELLANT BY HIMSELF DURING THE PROCEEDINGS SUPPORTS THE ARGUMENT OF THE A.O. T HOUGHT THE A.O. HAS NOT MADE ANY ANALYSIS WITH REGARD TO THE PENAK PURCHASES AND BANK TRANSACTIONS FROM THE PEAK POINT OF VIEW, THE ASSESSEE HIMSELF HAS WORKED OUT AND CAME UP WITH THE PEAK OF HIS PURCHASES. THEREFORE, ACCEPTING THE ALT ERNATE GROUND OF THE APPELLANT, THE A.O. IS DIRECTED TO RESTRICT THE ADDITION TO TH E PEAK OF PURCHASES OF RS.31,50,000/- AS AGAINST THE ADDITION OF RS.85,08, 600/-. APPELLANT GETS PART RELIEF. 5. NOW THE ASSESSEE HAS FILED THE APPEAL BEFORE US. 3 ITA NO. 2219/MUM/2018 (ASSESSMENT YEAR: 2011-12) 6. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATIV E (LD. DR FOR SHORT) AND PERUSED THE RECORDS. WE FIND THAT THE LD. CIT(A) HAS GRANTE D RELIEF TO THE ASSESSEE AS DESIRED BY THE ASSESSEE FOR WHICH THE ASSESSEE HIMSELF GAVE TH E NECESSARY WORKING. HENCE, IN THIS VIEW OF THE MATTER, WE FIND THAT THE LD. CIT(A) HAS GRANTED THE ASSESSEE THE RELIEF WHICH THE ASSESSEE PLEADED BEFORE HIM. HENCE, WE UPHOLD T HE ORDER OF THE LD. CIT(A). MOREOVER, WE NOTE THAT IN REVENUES APPEAL IN THIS CASE IN ITA NO.2312/MUM/2018 VIDE ORDER DATED 31.07.2019, THIS ITAT HAS ALREADY UPHEL D THE ORDER OF THE LD. CIT(A). 7. IN THE RESULT, THIS APPEAL BY THE ASSESSEE STAND S DISMISSED. ORDER PRONOUNCED UNDER RULE 34(4) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1962, BY PLACING THE DETAILS ON THE NOTICE BOARD ON 09.03.20 21 SD/ - SD/ - (RAM LAL NEGI) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED : ROSHANI , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI