Girijamata Janhit Sevabhavi Sanstha, Aurangabad V. Income-tax Officer,

ITA 235/PUN/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9257 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 20-02-2018
• Assessment Year: 2009-2010
• Appeal Filed On: 09-03-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Bogus purchase; Business income
• Section: 143(3); 234B; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO S . 235 & 236 /P U N/20 15 / ASSESSMENT YEAR S : 20 0 9 - 1 0 & 2010 - 11 GIRIJAMATA JANHIT SEVABHAVI SANSTHA, PLOT NO.C - 268, MIDC, WALUJ, AURANGABAD - 431136 . / APPELLANT PAN: A A ATG9134B VS. THE INCOME TAX OFFICER, WARD 1(1), AURANGABAD . / RESPONDENT / APPELLANT BY : NONE / RESPONDENT BY : SHRI AJAY MODI / DATE OF HEARING : 2 0 . 0 2 .201 8 / DATE OF PRONOUNCEMENT: 27 . 0 2 .201 8 / ORDER PER SUSHMA CHOWLA, J M : BOTH T H E APPEAL S FILED BY THE ASSESSEE ARE AGAINST SEPARATE ORDER S OF CIT (A) - 2 , AURANGABAD , DATED 07 .0 1 .20 15 RELATING TO ASSESSMENT YEAR S 20 0 9 - 1 0 AND 2010 - 11 AGAINST RESPECTIVE ORDERS PASSED UNDER SECTION 143 (3) R.W.S. 147 / 143(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2. BOTH APPEALS RELATING TO THE SAME ASSESSEE ON IDENTICAL ISSUES WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE ITA NO S . 235 & 236 /P U N/20 15 GIRIJAMATA JANHIT SEVABHAVI SANSTHA 2 SAKE OF CONVENIENCE. IN ORDER TO ADJUDICATE THE ISSUES, REFERENCE IS BEING MADE TO THE FACTS IN ITA NO.235/PUN/2015, RELATING TO ASSESSMENT YEAR 2009 - 10. 3. THE ASSESSEE IN ITA NO.235/PUN/2015, RELATING TO ASSESSMENT YEAR 2009 - 10 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. COMMISSIO NER OF INCOME TAX (APPEALS) HAS ERRED IN ESTIMATING THE NET PROFIT AT 5 % ON TOTAL TURNOVER WORKING OUT TO RS.23,62,768/ - AND THERE BY CONFIRMING ADDITION TO INCOME AT RS.16,58,218/ - APPELLANT PRAYS TO DELETE THE ADDITIONS MADE. 2. WITHOUT PREJUDICE TO G ROUND NO.1 AND WITHOUT ACCEPTING ANY HAWALA TRANSACTIONS ETC. AND IF APPELLANT'S CONTENTION IS NOT ACCEPTED FOR ANY REASON, STILL THE TRANSACTIONS ALLEGED ARE REPRESENTED BY SALE, THEREBY PROFIT ON SALE IS ALREADY OFFERED IN RETURNED INCOME, THEREFORE ADDI TION MADE MAY PLEASE BE DELETED. 3 . WITHOUT PREJUDICE TO GROUND NO.1 AND 2 AND WITHOUT ACCEPTING ANY HAWALA TRANSACTIONS OR ESTIMATION OF INCOME AT 5 % ESTIMATE PERCENTAGE OF PROFIT, NOMINAL ESTIMATION SHOULD BE RESTRICTED TO ONLY ALLEGED HAWALA PURCHASES. 4. APPELLANT PRAYS TO DECLARE THAT ASSESSMENT PROCEEDINGS ARE BAD IN LAW AS THEY ARE RELYING MATERIAL WITHOUT ALLOWING CROSS EXAMINATION. 5. ASSESSMENT ORDER AND PROCEEDINGS BE DECLARED AS BAD IN LAW FOR ASSESSING OFFICER NOT PASSING SEPARATE SPEAKING ORDER ON OBJECTIONS RAISED. 6 . CIT(A) HAS ERRED IN NOT ADJUDICATING GROUND NO.1 AND 2 BEFORE HIM. 7 . APPELLANT PRAYS FOR JUST AND EQUITABLE RELIEF. 8. APPELLANT PRAYS FOR CANCELLATION OF INTEREST CHARGED U/S 234B 9. WITHOUT PREJUDICE TO GROUND NO.8 I NTEREST IF HELD LEVIABLE MAY BE RESTRICTED AS PER PROVISIONS OF SECTION 234B(3). 4. DESPITE SERVICE OF NOTICE, NONE APPEARED ON BEHALF OF THE ASSESSEE NOR ANY APPLICATION WAS MOVED FOR ADJOURNMENT. HOWEVER, WE PROCEED TO DECIDE THE TWO APPEALS FILED BY T HE ASSESSEE FOR THE RESPECTIVE YEARS AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE. ITA NO S . 235 & 236 /P U N/20 15 GIRIJAMATA JANHIT SEVABHAVI SANSTHA 3 5. THE ONLY ISSUE RAISED IN THE PRESENT APPEALS IS AGAINST ADDITION MADE BY ESTIMATING NET PROFIT AT 5% ON TOTAL TURNOVER. 6. WE FIND THAT THE ISS UE IS COVERED BY EARLIER ORDER OF TRIBUNAL IN BUNCH OF APPEALS WITH LEAD ORDER IN M/S. CHHABI ELECTRICALS PVT. LTD. VS. DCIT IN ITA NO.795/PUN/2014, RELATING TO ASSESSMENT YEAR 2010 - 11, ORDER DATED 28.04.2017. 7. ON PERUSAL OF RECORD, IT IS APPARENT THAT THE ADDITION WAS MADE IN THE HANDS OF ASSESSEE ON ACCOUNT OF INFORMATION RECEIVED FROM THE SALES TAX DEPARTMENT, WHEREIN LIST OF PARTIES WAS DRAWN, WHO HAD INDULGED IN MAKING BOGUS PURCHASES WITHOUT DELIVERY OF GOODS. THE ASSESSING OFFICER RELIED ON THE A FFIDAVITS FILED BY THE RESPECTIVE AUTHORITIES BEFORE THE SALES TAX DEPARTMENT. HOWEVER, THE PLEA OF ASSESSEE AGAINST THE SAME WAS THAT PURCHASES MADE BY IT WERE GENUINE AND THE NAME OF ASSESSEE WAS NOT MENTIONED IN THE STATEMENTS OF AFFIDAVIT. THE ASSESS ING OFFICER REJECTING THE EXPLANATION OF ASSESSEE MADE ADDITION OF 84,10,779/ - . 8. THE SAID ADDITION WAS CONFIRMED BY THE CIT(A) AS PURCHASES MADE FROM HAWALA DEALERS WERE NON GENUINE PURCHASES. THE PLEA OF ASSESSEE THAT AGAINST THE SAID PURCHASES, I T HAD MADE SALES TO THE TUNE OF 4.72 CRORES TO THE GOVERNMENT DEPARTMENTS AND THE ASSESSEE HAD MAINTAINED QUANTITATIVE RECORDS AND PRODUCED THE SAME BEFORE THE ASSESSING OFFICER, WAS ACCEPTED BY THE CIT(A). THE CIT(A) HELD THAT TOTAL AMOUNT OF PURCHASES COULD NOT BE ADDED AS INCOME OF ASSESSEE AND THEREFORE, ESTIMATED THE PROFITS @ 5% OF TOTAL SALES OF ASSESSEE OF 4.72 CRORES AND MADE ADDITION OF 23,62,728/ - . THE ASSESSEE HAD ALREADY RETURNED INCOME OF 7,04,510/ - AND ADDITION TO THE ITA NO S . 235 & 236 /P U N/20 15 GIRIJAMATA JANHIT SEVABHAVI SANSTHA 4 EXTENT OF 16 ,58,218/ - WAS CONFIRMED. THE ASSESSEE IS IN APPEAL AGAINST THE SAME. 9. WE FIND THAT THE ISSUE STANDS COVERED BY THE ORDER OF PUNE BENCH OF TRIBUNAL IN M/S. CHHABI ELECTRICALS PVT. LTD. VS. DCIT (SUPRA). FOLLOWING THE SAME PARITY OF REASONING, WE HOLD T HAT WHERE THE ASSESSEE HAS MAINTAINED QUANTITATIVE DETAILS OF GOODS AND WHERE ITS SUPPLIES WERE TO THE GOVERNMENT DEPARTMENT, THE PURCHASES AS SUCH, COULD NOT BE REJECTED. HOWEVER, IN THE TOTALITY O F THE ABOVE SAID FACTS AND CIRCUMSTANCES AND KEEPING IN M IND THE RATIO LAID DOWN BY THE TRIBUNAL IN M/S. CHHABI ELECTRICALS PVT. LTD. VS. DCIT (SUPRA), WE RESTRICT THE ADDITION IN THE HANDS OF ASSESSEE AND DIRECT THE ASSESSING OFFICER TO APPLY GP RATE OF 10% ON THE ALLEGED GOODS PURCHASED, OVER AND ABOVE THE GP RATE DECLARED BY THE ASSESSEE. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, PARTLY ALLOWED. 10. THE FACTS AND ISSUES IN ITA NO.236/PUN/2015 ARE IDENTICAL TO THE FACTS AND ISSUES IN ITA NO.235/PUN/2015 AND OUR DECISION IN ITA NO.235/PUN/2015 SHA LL APPLY MUTATIS MUTANDIS TO ITA NO.236/PUN/2015. 11 . IN THE RESULT, BOTH THE APPEALS OF ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 27 TH DAY OF FEBR UARY , 201 8 . SD/ - SD/ - ( ANIL CHATURVEDI ) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 27 TH FEBR UARY , 201 8 . G G C C V V S S R R ITA NO S . 235 & 236 /P U N/20 15 GIRIJAMATA JANHIT SEVABHAVI SANSTHA 5 / COPY OF THE ORDER IS FORW ARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - 2 , AURANGABAD ; 4. THE CIT (EXEMPTION) , PUNE ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FI LE. / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE