Gul Manoharlal Makhijani, Mumbai V. ITO, Ward - 2(1), Kalyan

ITA 3208/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 4971 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2009-2010
• Appeal Filed On: 14-05-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Bogus purchase
• Section: 142(1); 133(6); 143(1); 143(2); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA , AM AND SHRI AMARJIT SINGH, JM / I .T.A. NO. 3208 /MUM/201 9 ( / ASSESSMENT YEAR: 2009 - 10 ) & / I .T.A. NO. 3209 /MUM/20 1 9 ( / A SSESSMENT YEAR: 2010 - 11 ) GUL MANOHARLAL MAKHIJANI 6, RED ROSE SOCIETY, OPP, CHOPRA COURT, ULHASNAGAR, MAHARASHTRA - 421003 . / VS. COMMISSIONER OF INCOME TAX - 3, ROOM NO.30, A - WING, 6 TH FLOOR, ASHAR I. T. PARK, WAGLE INDL, ESTATE, THANE - 400064. ./ ./ PAN/GIR NO. : AAZPM5806H ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING : 18 / 0 2 / 20 2 1 / DATE OF PRONOUNCEMENT : 07 /0 4 / 2021 / O R D E R PER AMARJIT SINGH, J M: THE ASSESSEE HAS FILED THE ABOVE MENTIONED APPEAL S AGAINST THE ORDER DATED 22.02.2019 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 3 , THANE [HEREINAFTE R REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y S . 20 09 - 10 & 20 10 - 1 1 . ITA. NO.3208 /M/201 9 2. THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER DATED 22.02 .201 9 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 3 , ASSESSEE BY : NONE REVENUE BY: SHRI T. S. KHALSA (DR) ITA. NO S.3208 & 3209 / M/201 9 A.Y. 2009 - 10 & 2010 - 11 2 MUMBAI [HEREINAFTE R REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y. 2009 - 10 . 3 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE HONORABLE COMMISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIFIED IN HOLDING TH AT 12.5% OF THE ALLEGED TOTAL SUSPICIOUS PURCHASES BE DISALLOWED. THE LEARNED AO HAD DISALLOWED THE TOTAL ALLEGED SUSPICIOUS PURCHASES AMOUNTI NG TO RS. 49,72,735 / - . THE APPELLANT CRAVES LEAVE TO ADD AND/OR AMEND THE GROUNDS OF APPEAL BEFORE OR AT TH E TIME OF HEARING . 4 . THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 23 .0 9 .20 09 DECLARING TOTAL INCO ME TO THE TUNE OF RS. 8,79,690 / - FOR THE A.Y.2009 - 10 . THE RETURN WAS PROCESSED U/S 143(1) OF THE ACT ON 14.04.2010. THE CAS E OF THE ASSESSEE WAS REOPENED UPON THE INFORMATION RECEIVE D FROM THE SALES TAX DEPARTMENT IN WHICH IT WAS CONVEYED THAT THE ASSESSEE HAS TAKEN THE BOGUS PURCHASE ENTRY FROM THE FOLLOWING NINE PARTIES READ AS UNDER.: - S. NO. NAME OF THE ENTRY PROVIDER AMOU NT IN THE BILLS TAKEN BY THE ASSESSEE AMOUNT OF BILL TAKEN BY THE ASSESSEE 1 NAGESHWAR ENTERPRISES 35,119 2 TOP SHOP TRADING COMPANY PVT. LTD. 1,80,037 3 OM CORPORATION 11,21,169 4 LAXMI TRADING CO. 3,28,296 ITA. NO S.3208 & 3209 / M/201 9 A.Y. 2009 - 10 & 2010 - 11 3 5 NIKHIL ENTERPRISE 2,75,580 6 G.M. INTERN ATIONAL 2,24,192 7 JIGAN ENTERPRISES 8,69,564 8 PARSHVA & CO 17,49,485 9 DHRUV SALES CORPORATION 1,89,293 TOTAL RS.49,72,735 THEREAFTER, NOTICE U/S 148 OF THE ACT WAS ISSUED AND SERVED UPON THE ASSESSEE. NOTICES U/S 143 (2) & 142(1) WERE ISSUED AND SE RVED UPON THE ASSESSEE. A FTER THE REPLY OF THE ASSESSEE, THE AO RAISED THE ADDITION TO THE EXTENT OF 49,72,735/ - I.E. 100% OF THE BOGUS PURCHASE AND THE TOTAL INCOME OF THE ASSESSEE WAS ASSESSED TO THE TUNE OF RS.58,85,440/ - . FEELING AGGRIEVED, THE ASSESSE E FILED AN APPEAL BEFORE THE CIT(A) WHO RESTRICTED THE ADDITION TO THE EXTENT OF 12.5% OF THE BOGUS PURCHASE IN SUM OF RS. 49,72,735/ - WORKS OUT TO RS.6,21,591/ - BUT THE ASSESSEE WAS NOT SATISFIED , THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL. 5 . WE HAVE HEARD THE ARGUMENT ADVANCED BY THE LD. REPRESENTATIVE OF THE DEPARTMENT AND HAS GONE THROUGH THE CASE CAREFULLY . T HE LD. REPRESENTATIVE OF THE REVENUE HAS ARGUED THAT THE REVENUE APPEAL FOR THE SAME YEAR I.E. 2009 - 10 HAS BEEN DISMISSED BY THE HONBLE ITAT BY VIRTUE OF ORDER DATED 03.02.2021 IN WHICH THE HONBLE ITAT HAS CONFIRMED ADDITION OF THE BOGUS PURCHASE @ 12.5% OF THE BOGUS PURCHASE, THEREFORE, THE PRESENT APPEAL IS LIABLE TO BE DISMISSED. THE COPY OF ORDER DATED 03.02.2021 IS ON THE FILE IN WH ICH THE RELEVANT FINDING IS HEREBY REPRODUCED AS UNDER.: - ITA. NO S.3208 & 3209 / M/201 9 A.Y. 2009 - 10 & 2010 - 11 4 6. AFTER DUE CONSIDERATION OF FACTUAL MATRIX AS ENUMERATED IN THE PRECEDING PARAGRAPHS, IT IS QUITE EVIDENT THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION WHICH WOULD REQUIRE C ONSUMPTION OF MATERIAL. THE PURCHASE TRANSACTIONS CARRIED OUT BY THE ASSESSEE WITH SUSPICIOUS SUPPLIERS WERE EVIDENCED BY COPIES OF INVOICES AND THE PAYMENTS WERE THROUGH BANKING CHANNELS. THE CONFIRMATION OF ACCOUNTS AS WELL AS PAN OF THE SUPPLIERS WAS DU LY FURNISHED. THE SALES TURNOVER ACHIEVED BY THE ASSESSEE WAS NOT DISPUTED BY LD. AO. AT THE SAME TIME, THE ASSESSEE FAILED TO PRODUCE ANY OF THE SUPPLIERS FOR CONFIRMATION OF ACCOUNTS AND NOTICES ISSUED U/S 133(6) DID NOT ELICIT SATISFACTORY RESPONSE. THE REFORE, IT WAS A FIT CASE FOR ESTIMATION OF ADDITIONS ON THESE SUSPICIOUS PURCHASES. IN OUR CONSIDERED OPINION, LD. CIT(A) HAS CLINCHED THE ISSUE IN THE CORRECT PERSPECTIVE. THE ESTIMATION OF 12.5% WAS QUIET FAIR AND REASONABLE AND THE SAME DO NOT REQUIRE ANY INTERFERENCE ON OUR PART. THEREFORE, BY CONFIRMING THE STAND OF LD. CIT(A), WE DISMISS THE APPEAL. 7. FACTS AS WELL AS ISSUES ARE PARI - MATERIA THE SAME IN AY 2010 - 11 WHEREIN THE ASSESSEE WAS SADDLED WITH ADDITIONS OF RS.96.98 LACS ON ACCOUNT OF SUSPIC IOUS PURCHASES. THE LD. CIT(A) RESTRICTED THE SAME TO 12.5% APPLYING SIMILAR REASONING AND LOGIC. AGGRIEVED, THE REVENUE IS IN FURTHER APPEAL BEFORE US WITH IDENTICAL GROUNDS. SINCE, THE FACTS AS WELL AS ISSUES ARE IDENTICAL AS IN AY 2009 - 10, APPLYING ADJU DICATION OF THAT YEAR, WE DISMISS THIS APPEAL ALSO. 6 . SINCE THE MATTER OF CONTROVERSY HAS BEEN ADJUDICATED BY HONBLE ITAT IN THE APPEAL FILED BY THE REVENUE BEARING ITA. NO. 2762/MUM/2019 DATED 03.02.2021, THEREFORE, IN THE SAID CIRCUMSTANCES, WE DISMISS THE PRESENT APPEAL OF THE ASSESSEE. ITA. NO. 3209 /M/201 9 7 . THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER DATED 22.02 .201 9 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 3 , MUMBAI [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y. 2010 - 11. ITA. NO S.3208 & 3209 / M/201 9 A.Y. 2009 - 10 & 2010 - 11 5 8 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE HONORABLE COMMISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIFIED IN HOLDING THAT 12.5% OF THE ALLEGED TOTAL SUSPICIOUS PUR CHASES BE DISALLOWED. THE LEARNED AO HAD DISA LLOWED THE TOTAL ALLEGED SUSPICIOUS PURCHASES AMOUNTING TO RS.96,98,939/ - . 2. THE APPELLANT CRAVES LEAVE TO ADD AND/OR AMEND THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. 9. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 23 .09.20 10 DECLARING TOTAL INCOME TO THE TUNE OF RS. 13,51,970 / - FOR THE A.Y.2010 - 11 . THE RETURN WAS PROCESSED U/S 143(1) OF THE ACT . THE CASE OF THE ASSESSEE WAS REOPENED UPON THE INFORMATION RECEIVE D FROM THE SALES TAX DEPARTMENT, IN WHICH IT WAS CONVEYED THAT THE ASSESSEE HAS TAKEN THE BOGUS PURCHASE ENTRY FROM THE FOLLOWING NINE PARTIES READ AS UNDER.: - S. NO. NAME OF THE ENTRY PROVIDER AMOUNT IN THE BILLS TAKEN BY THE ASSESSEE AMOUNT OF BILL TAKEN BY THE ASSESSEE 1 SHUBHLAXMI SALES CORP. RS.11,78,050 2 AMAR ENTERPRISES RS. 15,50,411 3 JIGAN ENTERPRISES RS.60,818 4 MERCURY ENTERPRISES RS.16,12,352 5 NIKHIL ENTERPRISES RS.35,336 6 HITECH IMPEX RS.3,26,801 7 OM CORPORATION RS.13,64,197 8 DAKSHA ENTERPRISES RS.18,28,985 ITA. NO S.3208 & 3209 / M/201 9 A.Y. 2009 - 10 & 2010 - 11 6 9 PARSHVA & CO. RS.17,40,989 TOTAL RS.96,98,939 THEREAFTER, NOTICE U/S 148 OF THE ACT WAS ISSUED AND SERVED UPON THE ASSESSEE. NOTICES U/S 143(2) & 142(1) WERE ISSUED AND SERVED UPON THE ASSESSEE. A FTER THE REPLY OF THE ASSESS EE, THE AO RAISED THE ADDITION TO THE EXTENT OF 96,98,939 / - I.E. 100% OF THE BOGUS PURCHASE AND THE TOTAL INCOME OF THE ASSESSEE WAS ASSESSED TO THE TUNE OF RS. 1,10,93,890 / - . FEELING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO RESTRICTED THE ADDITION TO THE EXTENT OF 12.5% OF THE BOGUS PURCHASE IN SUM OF RS.96,98,939 / - WOR KS OUT TO RS.12,12 ,367 / - BUT THE ASSESSEE WAS NOT SATISFIED, THEREFORE, THE ASSESSEE HAS FIL ED THE PRESENT APPEAL BEFORE US. 10. WE HAVE HEARD THE ARGUMENT ADVANCED BY TH E LD. REPRESENTATIVE OF THE DEPARTMENT AND HAS GONE THROUGH THE CASE CAREFULLY. THE LD. REPRESENTATIVE OF THE REVENUE HAS ARGUED THAT THE REVENUE APPEAL FOR THE SAME YEAR I.E. 2010 - 11 HAS BEEN DISMISSED BY THE HONBLE ITAT BY VIRTUE OF ORDER DATED 03.02.20 21 IN WHICH THE HONBLE ITAT HAS CONFIRMED THE BOGUS PURCHASE @ 12.5% OF THE BOGUS PURCHASE, THEREFORE, THE PRESENT APPEAL IS LIABLE TO BE DISMISSED. THE COPY OF ORDER DATED 03.02.2021 IS ON THE FILE IN WHICH THE RELEVANT FINDING IS HEREBY REPRODUCED AS UN DER.: - 6. AFTER DUE CONSIDERATION OF FACTUAL MATRIX AS ENUMERATED IN THE PRECEDING PARAGRAPHS, IT IS QUITE EVIDENT THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION WHICH WOULD REQUIRE CONSUMPTION OF MATERIAL. THE PURCHASE TRANSACTIONS C ARRIED OUT BY THE ASSESSEE WITH SUSPICIOUS SUPPLIERS WERE EVIDENCED BY COPIES OF INVOICES AND THE PAYMENTS WERE THROUGH BANKING CHANNELS. THE CONFIRMATION OF ACCOUNTS AS WELL AS PAN OF THE SUPPLIERS WAS DULY FURNISHED. THE SALES TURNOVER ACHIEVED BY THE AS SESSEE WAS NOT DISPUTED BY LD. AO. AT THE SAME TIME, THE ASSESSEE FAILED TO PRODUCE ANY OF THE SUPPLIERS FOR CONFIRMATION OF ACCOUNTS AND NOTICES ISSUED U/S 133(6) DID NOT ELICIT SATISFACTORY ITA. NO S.3208 & 3209 / M/201 9 A.Y. 2009 - 10 & 2010 - 11 7 RESPONSE. THEREFORE, IT WAS A FIT CASE FOR ESTIMATION OF ADDITIO NS ON THESE SUSPICIOUS PURCHASES. IN OUR CONSIDERED OPINION, LD. CIT(A) HAS CLINCHED THE ISSUE IN THE CORRECT PERSPECTIVE. THE ESTIMATION OF 12.5% WAS QUIET FAIR AND REASONABLE AND THE SAME DO NOT REQUIRE ANY INTERFERENCE ON OUR PART. THEREFORE, BY CONFIRM ING THE STAND OF LD. CIT(A), WE DISMISS THE APPEAL. 7. FACTS AS WELL AS ISSUES ARE PARI - MATERIA THE SAME IN AY 2010 - 11 WHEREIN THE ASSESSEE WAS SADDLED WITH ADDITIONS OF RS.96.98 LACS ON ACCOUNT OF SUSPICIOUS PURCHASES. THE LD. CIT(A) RESTRICTED THE SAME TO 12.5% APPLYING SIMILAR REASONING AND LOGIC. AGGRIEVED, THE REVENUE IS IN FURTHER APPEAL BEFORE US WITH IDENTICAL GROUNDS. SINCE, THE FACTS AS WELL AS ISSUES ARE IDENTICAL AS IN AY 2009 - 10, APPLYING ADJUDICATION OF THAT YEAR, WE DISMISS THIS APPEAL ALSO. 11 . SINCE THE MATTER OF CONTROVERSY HAS BEEN ADJUDICATED BY HONBLE ITAT IN THE APPEAL FILED BY THE REVENUE BEARING ITA. NO. 2763 /MUM/2019 DATED 03.02.2021, THEREFORE, IN THE SAID CIRCUMS TANCE S , WE DISMISS THE PRESENT APPEAL OF THE ASSESSEE. 1 2 . IN THE RE SULT, THE APPEAL S FILED BY THE ASSESSEE ARE HEREBY DISMISSED ORDER PRONOUNCED IN THE OPEN COURT ON 07 / 0 4 / 2021 SD/ - SD / - ( SHAMIM YAHYA ) (AMARJIT SINGH / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATED : 07 / 0 4 / 20 2 1 V IJAY PAL SINGH/SR. PS ITA. NO S.3208 & 3209 / M/201 9 A.Y. 2009 - 10 & 2010 - 11 8 / 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, //T RUE COPY// / /(DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI