SHRI. JITENDRA S PATEL, MUMBAI V. ITO 27(1)(5), Mumbai

ITA 2455/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4090 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 18-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AJAY PRATAP SINGH
• Keywords: Bogus purchase; Peak credit
• Section: 69C; 143(3); 208; 13

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 2455 //201 9 (. . 2009-10 ) ITA NO. 2455/MUM/2019 (A.Y.2009-10) SHRI JITENDRA S. PATEL 202, JOLLY APARTMENT CO-OP HSG SOC, KIRAL ROAD, GHATKOPAR (W), MUMBAI-400086 / VS. ITO-27(1)(5) 4 TH FLOOR, TOWER NO.6, VASHI RAILWAY COMPLEX, VASHI- 400703. PAN/GIR NO: AAAPP5525F ( /APPELLANT) : ( / RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI AJAY PRATAP SINGH (DR) / DATE OF HEARING : 14/10/2020 / DATE OF PRONOUNCEMENT : 26/10/2020 / ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF COMMISSIONER OF INCOME-TAX (APPEALS)-26, MUMBAI [IN SHORT THE CIT(A)] DATED 18.02.2019 FOR THE ASSESSMENT YEAR 2009-10. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM TH E RECORDS ARE: THE ASSESSEE IS A TRADER IN TIMBER AND PLYWOOD. THE ASS ESSMENT FOR ASSESSMENT YEAR 2009-10 IN THE CASE OF THE ASSESSSEE WAS RE-OP ENED ON THE GROUND THAT THE ASSESSEE HAS INDULGED IN OBTAINING BOGUS PURCHA SE BILLS FROM HAWALA DEALERS DECLARED BY MAHARASHTRA GOVERNMENT. THE ASS ESSING OFFICER IN THE 2 ITA NO .2455/MUM/2019 (A.Y.2009-10) ASSESSMENT PROCEEDINGS MADE ADDITION OF RS. 16,83,2 69/- U/S 69C OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERED TO AS TH E ACT) IN RESPECT OF BOGUS PURCHASES. THE ADDITION WAS MADE ON THE BASIS OF CO MBINED PEAK CREDIT STANDING IN THE NAME OF HAWALA DEALERS. AGGRIEVED A GAINST THE ASSESSMENT ORDER DATED 27.03.2015 PASSED UNDER SECTION 143(3) R.W.SEC. 147 OF THE ACT, THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CI T(A) RESTRICTED THE ADDITION TO 8% OF THE BOGUS PURCHASES BY FOLLOWING THE ORDER OF TRIBUNAL IN ASSESSEES OWN CASE IN ASSESSMENT YEAR 2010-11. STILL AGGRIEVE D, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3. SHRI AJAY PRATAP SINGH REPRESENTING THE DEPARTME NT VEHEMENTLY DEFENDED THE IMPUGNED ORDER AND SUBMITTED THAT THE CIT(A) HAS GRANTED RELIEF TO THE ASSESSEE BY FOLLOWING THE ORDER OF TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010-11 DECIDED IN ITA NO. 391/MUM/ 208 VIDE ORDER DATED 09.05.2018. ONCE THE RELIEF HAS BEEN GRANTED TO THE ASSESSEE BY THE CIT(A) IN ACCORDANCE WITH HIS OWN SUBMISSIONS. NOW THE ASSESS EE CANNOT ASSAIL THE FINDINGS OF CIT(A). 4. WE HAVE HEARD THE SUBMISSION MADE BY DEPARTMENTA L REPRESENTATIVE (DR) AND HAVE EXAMINED THE ORDER OF THE AUTHORITIES BELOW. THE ASSESSEE IN APPEAL HAS ASSAILED THE FINDINGS OF CIT(A) IN CONFI RMING THE ADDITION BY ESTIMATING GROSS PROFIT @ 8% ON BOGUS PURCHASE. 5. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT THE A SSESSEE APART FROM MAKING SUBMISSIONS ON MERIT HAS ALSO PLACED RELIANC E ON THE ORDER OF TRIBUNAL IN ITA NO. 391 / MUM/2018 (SUPRA) IN HIS OWN CASE. THE CIT(A) DECIDED THE 3 ITA NO .2455/MUM/2019 (A.Y.2009-10) APPEAL OF ASSESSEE IN ACCORDANCE WITH THE AFORESAID ORDER OF THE TRIBUNAL. FOR THE SAKE OF COMPLETENESS, THE RELEVANT EXTRACT OF T HE IMPUGNED ORDER IS REPRODUCED HEREIN BELOW: APPELLANT HAS STATED THAT IN APPELLANTS OWN CASE FOR A.Y. 2010-11 HONBLE ITAT SMC BENCH, MUMBAI IN ITA NO. 391/MUM/2018 VIDE ORDER DATED 09/05/2018 HAS REDUCED THE PROFIT RATE TO 8% ON THE SIMILAR SET OF FACTS. RESPECTFULLY FOLLOWING THE ORDER OF HONBLE ITAT, M UMBAI THE ADDITION IS RESTRICTED TO 8% OF THE BOGUS PURCHASES OF RS. 57,0 7,449/-. THIS GROUND OF APPEAL IS PARTLY ALLOWED . 6. HERE IT WOULD BE RELEVANT TO MENTION THAT THE AS SESSEE IN PARA 12 OF THE WRITTEN SUBMISSION BEFORE THE CIT(A) ADMITTED THAT GROSS PROFIT DECLARED DURING THE YEAR IS 8.44% AND IN PARA 13 OF THE SUBM ISSIONS RELIED ON TRIBUNAL ORDER IN ASSESSEES OWN CASE FOR AY 2010-11. THE RE LEVANT PART OF ASSESSEES SUBMISSION BEFORE THE FIRST APPELLATE AUTHORITY ARE REPRODUCED HEREIN BELOW: 12. APPELLANT STATES THAT THE GP RATIO FOLLOWED SI NCE LAST FEW YEARS HAS NOT ALL BEEN DISTURBED. THE GROSS PROFIT DECLARED DURING TH IS YEAR 8.44%, THEREFORE, ANY ADDITIONS TO PROFIT IS UNVIABLE, SINCE THE AS PER T HE GP RATE DECLARED IT IMPOSSIBLE FOR ANY INDUSTRY TO SUSTAIN. 13. IN APPELLANTS OWN MATTER HONBLE ITAT FOR THE AY 2010-11 LOOKING THE SAME FACTS AND CIRCUMSTANCES IN ITA NO. 391/M/2018 HAS R EDUCED THE GP AND ADDED THE GROSS PROFIT @ 8%. COPY OF THE SAID JUDGMENT IS ENCLOSED HEREWITH FOR YOUR READY REFERENCE. 7. THE ASSESSEE HAS NOT RAISED ABOVE CONTENTIONS AS AN ALTERNATE PLEA OR WITHOUT PREJUDICE TO THE OTHER PLEAS RAISED IN WRIT TEN SUBMISSIONS. THE CIT(A) HAS MADE A SPECIFIC OBSERVATION THAT THE FACTS ARE SIMILAR IN BOTH THE ASSESSMENT YEARS. THE CIT(A) AFTER CONSIDERING THE FACTS AND THE ORDER OF 4 ITA NO .2455/MUM/2019 (A.Y.2009-10) TRIBUNAL RESTRICTED THE GROSS PROFIT TO 8% ON BOGUS PURCHASES. IN THE LIGHT OF ABOVE FACTS, I SEE NO REASONS TO INTERFERE WITH THE ORDER OF CIT(A). THE SAME IS UPHELD AND THE APPEAL OF THE ASSESSEE IS DISMISSED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON MONDAY THE 26 TH DAY OF OCTOBER, 2020. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, )/ DATED: 26 /10/2020 S.K., PS * , * , * , * , COPY OF THE ORDER FORWARDED TO : 1. . / THE APPELLANT , 2. */ / THE RESPONDENT. 3. 0 ( )/ THE CIT(A)- 4. 0 CIT 5. * , . . . , / DR, ITAT, MUMBAI 6. 4 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI