PALMON EXPORTS KASEZ, MUMBAI V. INCOME TAX OFFICER-22(2)(1), MUMBAI

ITA 3016/MUM/2022

AI Insights

The case involves Palmon Exports Kasez, a firm engaged in the business of dealing in garments, textiles, metal, computers, exports, and imports, which appealed against the orders of the Income Tax Officer (ITO) and the Commissioner of Income Tax (Appeals) - National Faceless Appeal Centre (NFAC). The appeals pertain to the Assessment Years 2011-12, 2012-13, and 2014-15, challenging the additions made by the ITO and confirmed by the CIT(A) regarding unexplained purchases amounting to Rs.1,20,55,013 from suspicious parties. The CIT(A) had confirmed the additions through an ex parte order due to the assessee's failure to furnish supporting documentary evidence. The ITAT found merit in the assessee's request for another opportunity to present its case and thus remanded the matter back to the CIT(A).

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 300208 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 22-01-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 27-11-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gross profit estimation
• Section: 143(3); 234B; 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI S. RIFAUR RAHMAN, AM AND MS. KAVITHA RAJAGOPAL, JM IT A N o s . 3 013, 30 1 4 & 3 01 6/ M u m/ 2 0 2 2 (A s s e ss me nt Y e a rs : 2 011 - 1 2, 20 1 2- 1 3 & 20 14- 1 5 ) Palmon Exports Kasez 9, Janta Industrial Compound, 162, Senapati Bapat Marg, Lower Parel, Mumbai-400 013 V s. Income Tax Officer-22(2)(1) Mumbai P A N / G I R N o. AA H F P 436 9 G (Appellant) : (Respondent) Assessee by : Shri Himanshu Gandhi Revenue by : Shri A. N. Bhalekar D a te o f H e a r i n g : 23.01.2023 D ate of P ro n ou n ce me n t : 24.01.2023 O R D E R Per Kavitha Rajagopal, J M: The captioned appeals have been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals) (‘ld.CIT(A) for short), National Faceless Appeal Centre (‘NFAC’ for short) passed u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Years (‘A.Y.’ for short) 2011-12, 2012-13 and 2014- 15. It is observed that the said appeals are time barred by 15 days and after hearing both the sides, we hereby condone the delay as there was sufficient cause for the delay in filing the present appeals. 2. The assessee has challenged the grounds of reopening and the additions made by the Assessing Officer (A.O. for short) and confirmed by the ld. CIT(A) on the ground that 2 I T A N o s . 3 0 1 3 , 3 0 1 4 & 3 0 1 6 / M u m / 2 0 2 2 ( A Y s . 2 0 1 1 - 1 2 , 2 0 1 2 - 1 3 & 2 0 1 4 - 1 5 ) Palmon Exports Kasez vs. ITO the assessee has declared low gross profit by obtaining bills from suspicious parties. The assessee has also challenged the grounds of interest charged u/s. 234B and 234C along with the other consequential grounds. 3. As the grounds of appeal are similar in all these appeals, we hereby pass a consolidated order in all the three appeals mentioned above by taking ITA No. 3013/Mum/2022 as the lead case. 4. The brief facts are that the assessee firm is into the business of dealing in garments, textiles, metal, computers, exports and imports. The assessee company filed its return of income dated 20.08.2011, declaring total income of Rs.4,01,427/- and the return was processed u/s. 143(1) of the Act and the assessee’s case was reopened based on the information received from DGIT (Inv.), Mumbai based on the Sales Tax Departments investigation on VAT evaders, wherein it was found that the assessee was one of the beneficiary of accommodation bills from various hawala parties without actual delivery of goods. During the impugned year, it was observed that the assessee company had purchased from Gold Star Trading Company by way of bogus bills, amounting to Rs.1,20,55,013/-. The assessment order u/s. 143(3) of the Act r.w.s. 147 of the Act dated 17.10.2016 was passed by the A.O. by making addition, amounting to Rs.30,13,753/- as unexplained purchases @ 25% of the impugned purchase, amounting to Rs.1,20,53,013/- on account of gross profit. 5. The assessee was in appeal before the ld. CIT(A), challenging the assessment order dated 17.10.2016. 3 I T A N o s . 3 0 1 3 , 3 0 1 4 & 3 0 1 6 / M u m / 2 0 2 2 ( A Y s . 2 0 1 1 - 1 2 , 2 0 1 2 - 1 3 & 2 0 1 4 - 1 5 ) Palmon Exports Kasez vs. ITO 6. The ld. CIT(A) confirmed the addition made by the A.O. by way of an ex parte order on the ground that the assessee company has failed to furnish any material by way of documentary evidence in support of its claim. 7. Further aggrieved, the assessee is in appeal before us, challenging the ex parte order of the ld. CIT(A). 8. The learned Authorised Representative (ld. AR for short) for the assessee contended that the assessee was not given sufficient opportunity to present its case before the ld. CIT(A) and prayed for one more opportunity to present the assessee’s case before the ld. CIT(A). The ld. AR further stated that the assessee has got substantial materials to substantiate its claim on merits. 9. The learned Departmental Representative (ld. DR for short) had nothing to controvert the same. 10. Having heard the rival submissions and perused the materials available on record, we deem it fit and proper to provide one last opportunity to the assessee to present its case before the ld. CIT(A). The assessee is directed to produce all the documentary evidences proposed to be filed before the ld. CIT(A) and the ld. CIT(A) may decide all these appeals on merits based on the submissions of the assessee. Hence, all these appeals filed by the assessee are remanded back to the file of the ld. CIT(A) for de novo adjudication. 4 I T A N o s . 3 0 1 3 , 3 0 1 4 & 3 0 1 6 / M u m / 2 0 2 2 ( A Y s . 2 0 1 1 - 1 2 , 2 0 1 2 - 1 3 & 2 0 1 4 - 1 5 ) Palmon Exports Kasez vs. ITO 11. In the result, all these appeals are allowed for statistical purpose. Order pronounced in the open court on 24.01.2023 Sd/- Sd/- (S. Rifaur Rahman) (Kavitha Rajagopal) Accountant Member Judicial Member Mumbai; Dated : 24.01.2023 Roshani , Sr. PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT(A) 4. CIT - concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER, (Dy./Asstt. Registrar) ITAT, Mumbai