NAGIN G. SUTHAR, MUMBAI V. ITO 22 (2)(4), MUMBAI

ITA 3185/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 3752 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 13-05-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Keywords: Bogus purchase
• Section: 13

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI SHRI SHAMIM YAHYA (AM) & SHRI AMARJIT SINGH (JM) I.T.A. NO. 3185/MUM/2019 (ASSESSMENT YEAR 2009-10) I.T.A. NO. 3186/MUM/2019 (ASSESSMENT YEAR 2010-11) I.T.A. NO. 3187/MUM/2019 (ASSESSMENT YEAR 2011-12) I.T.A. NO. 3188/MUM/2019 (ASSESSMENT YEAR 2012-13) NAGIN GOVINDJI SUTHAR ROOM NO.02, PIPWALA CHAWL, PRABHAT COLONY SANTACRUZ EAST MUMBAI-400 055. PAN : AIGPM3819F VS. ITO-22(2)(4) ROOM NO. 310 3 RD FLOOR PIRAMAL CHAMBERS PAREL, LALBAUGH MUMAI-400 012. (APPELLANT) (RESPONDENT) ASSESSEE BY NONE DEPARTMENT BY MS. SMITA VERMA DATE OF HEARING 22.02.2021 DATE OF PRONOUNCEMENT 01.03.2021 O R D E R PER SHAMIM YAHYA (AM) :- THESE ARE APPEALS BY THE ASSESSEE WHEREIN THE ASS ESSEE IS AGGRIEVED THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [I N SHORT LEARNED CIT(A)] VIDE COMMON ORDER DATED 7.9.2018 HAS ERRED IN SUSTA INING12.5% DISALLOWANCE ON ACCOUNT OF BOGUS PURCHASES AS UNDER :- ASSESSMENT YEAR AMOUNT 2009-10 9,29,154 2010-11 5,93,806 2011-12 2,21,194 2012 - 13 7,14,583 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS ENG AGED IN THE BUSINESS OF FURNITURE CONTRACTOR. INFORMATION WAS RECEIVED FROM THE SALES TAX DEPARTMENT THAT ASSESSEE HAS ENGAGED IN BOGUS PURCHASES. THE A SSESSMENT WAS ACCORDINGLY REOPENED. THE BOGUS PURCHASES NOTED WER E AS UNDER :- NAGIN GOVINDJI SUTHAR 2 ASSESSMENT YEAR AMOUNT 2009-10 73,33,329 2010-11 47,50,454 2011 - 12 17,69,555 2012-13 56,87,666 THE ASSESSING OFFICER IN THIS CASE HAS MADE 25% ADD ITION ON ACCOUNT OF BOGUS PURCHASE AS UNDER :- ASSESSMENT YEAR AMOUNT 2009-10 18,58,309 2010 - 11 11,87,613 2011 - 12 4,42,389 2012-13 14,28,166 3. UPON ASSESSEES APPEAL LEARNED CIT(A) SUSTAINED 12.5% WITHOUT GOING INTO THE DETAILS OF ADJUDICATION. 4. AGAINST ABOVE ORDER ASSESSEE IS IN APPEAL BEFORE THE ITAT. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE RECORDS. NONE APPEARED ON BEHALF OF THE ASSESSEE DESPITE SEVERAL NOTICES. 5. UPON CAREFUL CONSIDERATION WE FIND THAT ASSESSEE HAS ONLY PROVIDED PURCHASE BILLS FROM THE SAID HAWALA DEALERS. ADVERS E INFERENCES HAVE BEEN DRAWN DUE TO THE INABILITY OF THE ASSESSEE TO PRODU CE THE SUPPLIERS. ALSO THE ASSESSING OFFICER HAS NOTED THAT THE ASSESSEE HAS N OT FURNISHED ANY DETAIL AS TO HOW THE ITEM PURCHASED FROM THE AFORESAID HAWALA DEALERS WERE UTILIZED/CONSUMED IN THIS PROCESS OF ITS BUSINESS. THUS WE FIND THAT IN THIS CASE THE CONSUMPTION HAS BEEN CLEARLY DOUBTED. THI S IS MORE SO AS IN THE PRESENT CASE ASSESSEE IS ENGAGED IN THE BUSINESS OF FURNITURE CONTRACTOR. AO HAS ALSO MADE DISALLOWANCE OF LABOUR CHARGES ALSO. IN THE PRESENT CASE THE FACTS OF THE CASE INDICATE THAT ASSESSEE HAS MADE P URCHASE FROM THE GREY MARKET. MAKING PURCHASES THROUGH THE GREY MARKET GI VES THE ASSESSEE SAVINGS ON ACCOUNT OF NON-PAYMENT OF TAX AND OTHERS AT THE EXPENSE OF THE EXCHEQUER. THE ASSESSING OFFICER HAS MADE 25% DISALLOWANCE WHI CH THE LEARNED CIT(A) HAS RESTRICTED TO 12.5% WITHOUT ANY ADJUDICATION. H OWEVER THERE IS NO APPEAL NAGIN GOVINDJI SUTHAR 3 BY THE REVENUE. IN SUCH SITUATION IN OUR CONSIDERED OPINION ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE 12.5% DISALLOWANCE OU T OF THE BOGUS PURCHASES HAS TO BE UPHELD. 6. IN THE RESULT, THESE APPEALS FILED BY THE ASSESS EE STAND DISMISSED. PRONOUNCED IN THE OPEN COURT ON 1.3.2021. SD/- SD/- (AMARJIT SINGH) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED : 01 /03/2021 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR) PS ITAT, MUMBAI