ITO 27(1)(1), MUMBAI V. ANIL R. JASANI, MUMBAI

ITA 2795/MUM/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5775 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 04-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR SONI
• Keywords: Bogus purchase; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO. 2795/MUM/2018 ASSESSMENT YEAR : 2009-10 INCOME TAX OFFICER-27(1)(1), MUMBAI VS. SHRI ANIL R. JASANI, 7, VALMINI BUILDING, R.B. MEHTA MARG, GHATKOPAR (E), MUMBAI [PAN : AAGPJ9392J] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VIJAY KUMAR SONI, DR RESPONDENT BY : NONE DATE OF HEARING : 28-01-2019 DATE OF PRONOUNCEMENT : 30-01-2019 O R D E R THIS APPEAL IS FILED BY THE REVENUE AND THE SAME IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCO ME TAX(APPEALS)-25, MUMBAI, DATED 02-02-2018 FOR THE AY . 2009-10. 2. THE GROUNDS RAISED BY THE REVENUE ARE AS UNDER: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS. 43,94, 904/- MADE BY THE ITA NO. 2795/MUM/2018 : 2 : ASSESSING OFFICER ON ACCOUNT OF BOGUS PURCHASES, WI THOUT APPRECIATING THE FACT THAT THE ASSESSEE HAD FAILED TO PRODUCE BILLS, VOUCHERS AND OTHER DOCUMENTARY EVIDENCES IN SUPPORT OF HIS CLAIM AND WITHOUT CONSIDERING THE LATEST APEX COURT DECIS ION IN THE CASE OF N.K. PROTEIN LTD., WHEREIN IT IS HELD THAT ONCE IT IS PROVED THAT THE PURCHASES ARE BOGUS THEN ADDITION SHOULD BE MADE ON ENTIRE PURCHASE AND NOT ON PROFIT ELEMENT EMBEDDED IN SUCH PURCHASES. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) ERRED IN ESTIMATING THE PROFIT FROM HAWALA P URCHASES BY DISALLOWING ONLY RS. 5,49,363/- BEING 12.5% OF TOTA L PURCHASES AS EVEN THE BASIC ONUS OF PRODUCING TRANSPORT BILLS, D ELIVERY CHALLANS ETC. WERE NOT FULFILLED BY THE ASSESSEE. 3. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUNDS BE REVERSED AND THAT OF THE ASSESSING OFFIC ER BE RESTORED. 4. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUNDS OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 3. THIS APPEAL WAS FIXED FOR HEARING ON 28-01-2019. ON THIS DATE, NONE APPEARED ON BEHALF OF THE ASSESSEE IN SPITE OF NOTICE AND HENCE, THE APPEAL OF REVENUE WAS DECIDED EX-PARTE QUA THE ASSESSEE. 4. AT THE OUTSET, IT WAS POINTED OUT BY THE BENCH TO THE LD. LD. DR OF THE REVENUE THAT THE TAX EFFECT IN THE PRESENT CA SE APPEARS TO BE BELOW RS. 20 LAKHS, BECAUSE IN GROUND NO.1, REVENUE IS DISPUTING THE DELETION OF THE ADDITION OF RS. 43,94,904/- AND IN GROUND NO. 2, REVENUE IS DISPUTIN G THE DELETION OF ADDITION OF RS. 5,49,363/-. ITA NO. 2795/MUM/2018 : 3 : 5. IN REPLY, THE LD. DR OF THE REVENUE COULD NOT SHOW THAT THE TAX EFFECT IN THIS APPEAL IS MORE THAN RS. 20 LAKHS. THEREFORE, IN VIEW OF THE CBDT CIRCULAR NO. 03/2018 DATED 11-07-2018 COMES INTO PLAY, WHEREIN, THE MONETARY LIM IT FOR FILING THE APPEALS BY THE REVENUE BEFORE THE ITAT AND VARIOUS HIGH COURTS AS WELL AS APEX COURT ARE REVISED WITH AN OBJECT OF REDUCING THE TAX LITIGATION. VIDE PARA 3 OF THE SAID CIRCULAR (SUPRA), IT IS STATED THAT IN CASES WHERE THE TAX EFFECT IN THE APPEALS TO BE FILED BEFORE THE APPELLATE TRIBUNAL DOE S NOT EXCEED RS. 20 LAKHS APPEALS SHOULD NOT BE FILED. TH US TAKING NOTE OF CBDT CIRCULAR NO. 03/2018, DATED 11-07-2018 AND CONSIDERING THE FACT THAT THE TAX EFFECT IN THE INSTANT APPE AL IS LESS THAN RS. 20 LAKHS, THE PRESENT APPEAL DESERVES TO BE DISMISSED AS NOT PRESSED / NOT MAINTAINABLE. HOWEVER, I MAKE IT CLEAR THAT THE ISSUES RAISED IN THE INSTANT APPEAL ARE LEFT OPEN TO BE EXAMINED IN THE APPROPRIATE PROCEEDINGS, I F ARISES, IN FUTURE. AT THE SAME TIME, I ALSO MAKE IT CLEAR THAT IF THE APPEAL FALLS IN ANY OF THE EXCEPTIONS REFERRED TO IN TH E ABOVE SAID CBDT CIRCULAR, THE REVENUE IS AT LIBERTY TO MOVE AN APPLICATION FOR RECALLING THE ORDER, IF SO, ADVISED. ITA NO. 2795/MUM/2018 : 4 : 6. ACCORDINGLY IN THE LIGHT OF CBDT CIRCULAR NO. 03/2 018 DATED 11-07-2018, THE PRESENT APPEAL IS NOT MAINTAINABLE AND HENCE, DISMISSED. 7. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DAY OF JANUARY, 2019 SD/- (A.K. GARODIA) /ACCOUNTANT MEMBER /MUMBAI; /DATED : 30 TH JANUARY, 2019 TNMM ITA NO. 2795/MUM/2018 : 5 : / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. ' ! / THE RESPONDENT 3. # $ ( ) / THE CIT(A), MUMBAI 4. # $ / CIT, MUMBAI 5. '()*+ , #-*+#. , / DR, ITAT, MUMBAI 6. )/01 / GUARD FILE # / BY ORDER, ' //TRUE COPY// /# (DY./ASST. REGISTRAR) #-*+#., / ITAT, MUMBAI