DINESH B JHALA, MUMBAI V. ITO 15(1)(4), MUMBAI

ITA 3108/MUM/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2746 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 22-05-2015
• Court: TRIBUNAL
• Assessee Lawyers: S C TIWARI; RUTUJA PAWAR
• Keywords: Bogus purchase

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER ./ ITA NO. 3108 / MUM/20 1 5 ( / ASSESSMENT YEAR : 20 10 - 20 1 1 MR. DINESH B. JH ALA, 4, PREMLOK BUILDING, CROSS M.G.ROAD, BORIVALI (E), MUMBAI - 40068 VS. ITO - WARD - 15(1)(4), ROOM NO.108, 1 ST FLOOR, MATRU MANDIR, GRANT ROAD, MUMBAI - 400002 ./ ./ PAN/GIR NO. : A DHPJ 9345 F ( / APPELLANT ) .. ( / RESP ONDENT ) /REVENUE BY : SHRI ARVIND KUMAR /ASSESSEE BY : SHRI S.C.TIWARI & MS. RUTUJA PAWAR / DATE OF HEARING : 04 / 0 7 /201 6 / DATE OF PRONOUNCEMENT 08/07 /201 6 / O R D E R THIS IS AN APPEAL FILED B Y THE ASSESSEE AGAINST THE ORDER OF CIT(A) - MUMBAI, FOR THE ASSESSMENT YEAR 20 1 0 - 201 1. 2. IN THIS APPEAL THE ASSESSEE IS AGGRIEVED FOR ADDITION MADE BY THE AO DISALLOWING PURCHASE OF RS.20,17,416/ - TREATING THE SAME AS BOGUS PURCHASES. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT ASSESSEE IS IN THE BUSINESS OF CONSTRUCTION. ON THE INFORMATION OF SALES TAX AUTHORITIES THE AO DISALLOWED PURCHASES OF RS.20,17,416/ - BY OBSERVING THAT PURCHASES MADE BY THE ASSESSEE FROM THREE PARTIES APPEARING IN THE SALES TAX HAWALA LIST AND CLAIMED IN ITS PROFIT AND LOSS ACCOUNT ARE NOT GENUINE. BY THE IMPUGNED ORDER THE CIT(A) CONFIRMED THE ACTION OF THE AO. ITA NO. 3108 / 1 5 2 4. I HAVE CONSIDERED RIVAL CONTENTIONS A ND FOUND THAT MERELY ON THE BASIS OF INFORMATION FROM SALES TAX DEPARTMENT, THE AO HAS TREATED THE PURCHASES AS BOGUS WITHOUT MAKING ANY INDEPENDENT ENQUIRY. I ALSO FOUND THAT ASSESSEE HAD SHOWN NET PROFIT OF RS.13,85,827/ - ON THE SALES OF RS.5.29 CRORES. HOWEVER, THE AO HAS DECLINED THE CORRESPONDING SALES MADE BY THE ASSESSEE , NOR REJECTED ASSESSEES BOOKS OF ACCOUNS . KEEPING VIEW VARIOUS JUDICIAL PRONOUNCEMENTS REFERRED BY THE A R IN THE CASE OF GANPAT R AJ A SANGHVI, ITA NO.2826/MUM/2013, ORDER DATED 5 - 11 - 2014 AND JM TEXTILES, ITA NO.7537&7538/M/2013, ORDER DATED 4 - 11 - 2015 AND ALSO CONSIDERING THE NET PROFIT RATE SHOWN BY THE ASSESSEE , I RESTRICT THE DISALLOWANCE/ADDITION TO THE EXTENT OF 5% OF THE BOGUS PURCHASES SO MADE BY ASSESSEE . I DIRECT ACCORDINGLY. 5 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 08/07 / 201 6 . SD/ - ( R.C.SHARMA ) / ACCOUNTANT MEMBER MUMBAI ; DATED 08/07 /201 6 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//