ITO 27 (2)(3), MUMBAI V. MITTAL SATISH MEHTA, MUMBAI

ITA 2517/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 6303 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 23-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAY PRATAP SINGH
• Keywords: Bogus purchase
• Section: 143(3); 133(6); 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , ! BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 2517 / / 2019 (%. .2009-10 ) ITA NO. 2517/MUM/2019 (A.Y.2009-10) ITO-27(2)(3), ROOM NO.417, 4 TH FLOOR, 6 TH TOWER, VASHI RLY STATION COMPLEX, NAVI MUMBAI 400 703 / VS. : / APPELLANT SHRI MITTAL SATISH MEHTA, 15, KESHAV SOCIETY, JADUSHA NAGAR, GOLIBAR ROAD, GHATKOPAR (W), MUMBAI 400 086 PAN:AAEPM2370F : / RESPONDENT ASSESSEE BY : NONE REVENUE BY : SHRI AJAY PRATAP SINGH / DATE OF HEARING : 15/10/2020 / DATE OF PRONOUNCEMENT : 11 /01/2021 / ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-25, MUMBAI ( IN SHORT THE CIT (A)) DATED 14/02/2019 FOR THE ASSESSMENT YEAR 2009-10. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM THE RECORDS ARE: THE ASSESSEE IS ENGAGED IN MANUFACTURING OF PRINTED PACKING MATERI AL AND ADVERTISING MATERIAL. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE IMP UGNED ASSESSMENT YEAR ON 31/08/2009 DECLARING TOTAL INCOME OF RS.1,86,670/-. THE RETURN OF THE ASSESSEE WAS 2 ITA NO. 2517/MUM/2019 (A.Y.2009-10) PROCESSED UNDER SECTION 143(1) OF THE INCOME TAX A CT, 1961 ( IN SHORT THE ACT). ON THE BASIS OF INFORMATION RECEIVED BY DGIT(INV.), MU MBAI FROM SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA, THE ASSESSMENT FOR ASSES SMENT YEAR 2009-10 IN THE CASE OF ASSESSEE WAS REOPENED. AS PER THE INFOR MATION RECEIVED, THE ASSESSEE HAD OBTAINED BOGUS PURCHASE BILLS AMOUNTING OF RS.2,41, 665/- DURING THE PERIOD RELEVANT TO THE ASSESSMENT YEAR UNDER APPEAL FROM FOUR HAWAL A DEALERS. DURING ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER ASKED THE ASSESS EE TO PROVE GENUINENESS OF THE PURCHASES. THE ASSESSEE FAILED TO PRODUCE DOCUME NTS LIKE OCTROI RECEIPTS, TRANSPORT RECEIPTS, STOCK REGISTER, ETC. TO SHOW TRAIL OF GOO DS. THE ASSESSEE EVEN FAILED TO PRODUCE THE SUPPLIERS OF THE GOODS. THE NOTICE SE NT BY THE ASSESSING OFFICER UNDER SECTION 133(6) OF THE INCOME TAX ACT, 1961 ( IN SH ORT THE ACT), TO THE SUPPLIERS ON THE ADDRESS PROVIDED BY THE ASSESSEE REMAINED UNRES PONDED. THUS, THE ASSESSING OFFICER MADE ADDITION OF ENTIRE BOGUS PURCHASES. AGGRIEVED BY ASSESSMENT ORDER DATED 13/03/2015 PASSED UNDER SECTION 143(3) R.W.S. 147 OF THE ACT, THE ASSESSEE FILED APPEAL BEFORE THE CIT(A) CHALLENGING THE ADDI TION. THE CIT(A) AFTER EXAMINING THE FACTS AND THE SUBMISSIONS OF THE ASSESSEE REST RICTED THE ADDITION TO 12.5% ON BOGUS PURCHASES. AGAINST THE RELIEF GRANTED BY CI T(A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 3. SHRI AJAY PRATAP SINGH, REPRESENTING THE DEPARTM ENT VEHEMENTLY DEFENDED THE ASSESSMENT ORDER AND PRAYED FOR REVERSING THE F INDING OF CIT(A). THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASS ESSEE FAILED TO PROVE GENUINENESS OF THE PURCHASES AND COULD NOT PRODUCE THE SUPPLIERS OF THE GOODS. 4. SUBMISSIONS MADE BY LD. DEPARTMENTAL REPRESENTAT IVE HEARD, ORDERS OF AUTHORITIES BELOW EXAMINED. THE ASSESSEE HAS INDULG ED IN OBTAINING BOGUS PURCHASE BILLS AGGREGATING TO RS.2,41,665/- FROM THE DECLAR ED HAWALA DEALERS . THE ASSESSEE FAILED TO PROVE GENUINENESS OF THE PURCHASES, CON SEQUENTLY, THE ASSESSING OFFICER MADE ADDITION OF ENTIRE SUCH BOGUS PURCHASES. IN F IRST APPELLATE PROCEEDINGS THE CIT(A) HELD THAT IT IS ONLY THE PROFIT EMBEDDED IN THE BOGUS PURCHASES THAT HAS TO BE 3 ITA NO. 2517/MUM/2019 (A.Y.2009-10) BROUGHT TO TAX. THE CIT(A) ESTIMATED GP @ 12.5% ON BOGUS PURCHASES. THE FINDINGS OF CIT(A) ARE IN LINE WITH THE JUDGMENT RENDERED I N THE CASE OF PCIT VS. PARAMSHAKHTI DISTRIBUTORS PVT. LTD. IN INCOME TAX APPEAL NO.413 OF 2017 DECIDED ON 15/07/2019 BY HON'BLE BOMBAY HIGH COURT . I CONCUR WITH THE FINDINGS OF CIT(A) AND UPHOLD THE SAME. THE APPEAL OF REVENUE IS DISMISSED BEING DEVOID OF MERIT. 5. NO APPEAL/CROSS OBJECTIONS FILED BY THE ASSESSEE AG AINST THE ORDER OF CIT(A) HAS BEEN BROUGHT TO THE NOTICE OF BENCH. IN CASE ANY APPEAL/CROSS OBJECTIONS BY THE ASSESSEE AGAINST IMPUGNED ORDER OF CIT(A) IS NO TICED, THEN THIS ORDER MAY BE RECALLED AND THE CROSS APPEALS MAY BE LISTED TOGETH ER FOR DISPOSAL BY A COMMON ORDER . 6. IN THE RESULT, APPEAL BY THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON MONDAY, THE 11 TH DAY OF JANUARY, 2021. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, (%/ DATED: 11/01/2021 VM , SR. PS(O/S) COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT , 2. *+ / THE RESPONDENT. 3. ,+ ( )/ THE CIT(A)- 4. ,+ CIT 5. -.*+% , . . . , / DR, ITAT, MUMBAI 6. ./012 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI