MOHIT P. JAIN, MUMBAI V. ITO (17)(2)(3), MUMBAI

ITA 237/MUM/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6526 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 17-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R BHOOPATHI
• Keywords: Bogus purchase; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI N.K. PRADHAN , ACCOUNTANT MEMBER ITA NO. 237/MUM/2019 : A.Y : 2012 - 1 3 MOHIT P. JAIN PROP. DIMENSIONS TRADELINK 31, YASHODHAN, DINSHAW VACHA ROAD, OPP. C.C.I., MUMBAI 400 020. PAN : A FAPJ6477R (APPELLANT) VS. ITO - 1 7 ( 2 )( 3 ), MUMBAI (RESPONDENT) APPELLANT BY : SHRI PRATIK JAIN RESPONDENT BY : SHRI R. BHOOPATHI DATE OF HEARING : 2 1 /01/2020 DATE OF PRONOUNCEMENT : 29 /01/2020 O R D E R PER VIKAS AWASTHY , JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A) - 58, MUMBAI DATED 09.11.2018 FOR ASSESSMENT YEAR 2012 - 13. 2. SHRI PRATIK JAIN APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS ENGAGED IN TRADING OF IRON AND STEEL. DURING ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER MADE ADDITION OF RS.9,04,217/ - ON ACCOUNT OF BOGUS PURCHASES FROM HAWALA PARTIES. T HE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAD OBTAINED BOGUS PURCHASE BILLS AGGREGATING TO RS.3,01,40,558/ - . THE ASSESSING OFFICER ESTIMATED SUPPRESSED PROFIT ON 2 ITA NO. 237/MUM/2019 MOHIT P. JAIN ACCOUNT OF BOGUS PURCHASES @ 3% OF SUCH PURCHASES, I.E. RS.9,04,217/ - . AGGRIEVED AGAINST THE SAID ADDITION, THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) CONFIRMED THE FINDINGS OF THE ASSESSING OFFICER. 3. THE LEARNED AR SUBMITTED THAT ADDITION CAN ONLY BE SUSTAINED TO THE EXTENT OF SUPPRESSED PROFIT. THE LEARNED AR POINTED OUT THAT THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO. 4589/MUM/20 09 FOR ASSESSMENT YEAR 2011 - 12 DECIDED ON 11.09.2019 HAS RESTORED THE ISSUE BACK TO THE FILE OF ASSESSING OFFICER FOR RECONSIDERATION IN LIGHT OF THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF PCIT VS M. HAJI ADAM & CO. IN ITA NO. 1004/20 16 DECIDED ON 11.02.2019. 4. PER CONTRA , SHRI R. BHOOPATHI REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE IMPUGNED ORDER. THE LEARNED DR SUBMITTED THAT THE AUTHORITIES BELOW WERE VERY REASONABLE IN ESTIMATING GROSS PROFIT AT 3% O N THE ALLEGED BOGUS PURCHASES. THE LEARNED DR PRAYED FOR DISMISSING THE APPEAL OF ASSESSEE AND UPHOLDING THE IMPUGNED ORDER. 5. BOTH THE SIDES HEARD. ORDERS OF THE AUTHORITIES BELOW PERUSED. THE ASSESSING OFFICER HAS ESTIMATED GROSS PROFIT ON ALLEGED BOGUS PURCHASES @ 3%. THE CIT(A) HAS UPHELD THE FINDINGS OF THE ASSESSING OFFICER. STILL AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. THE CONTENTION OF THE LEARNED AR IS THAT ADDITION ONLY TO THE EXTENT OF DIFFERENCE IN GROSS PROFIT CONCEALED SHOULD BE BROUGHT TO TAX. TO SUPPORT HIS CONTENTION, THE LEARNED AR HAS PLACED RELIANCE ON THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE IN ASSESSMENT YEAR 2011 - 12. TAKING INTO CONSIDERATION ENTIRETY OF FACTS, WE DE EM IT APPROPRIATE TO SET ASIDE THE ORDER OF CIT(A) AND RESTORE THIS APPEAL BACK TO THE FILE OF 3 ITA NO. 237/MUM/2019 MOHIT P. JAIN ASSESSING OFFICER TO RE - EXAMINE THE ISSUES IN LIGHT OF JUDGMENT RENDERED IN THE CASE OF M. HAJI ADAM & CO. (SUPRA) . NEEDLESS TO SAY, BEFORE DECIDING THE ISSUE A FRESH, THE ASSESSING OFFICER SHALL GRANT REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. 6. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON WEDNESDAY , THE 29 TH DAY OF JANUARY, 2020. SD/ - SD/ - ( N.K. PRADHAN ) ACCOUNTANT MEMBER ( VIKAS AWASTHY ) JUDICIAL MEMBER MUMBAI, DATE : 2 9 T H JANUARY , 20 20 *SSL* C OPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, SMC BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI