ACIT 12(2)(1), MUMBAI V. M/s EHARA ENGINEERING PVT. LTD., MUMBAI

ITA 3295/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 6244 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-09-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2011-2012
• Appeal Filed On: 16-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT PRATAP SINGH
• Keywords: Bogus purchase; Onus to prove
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E, MUMBAI , # , $%$& BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER . 3295 / /2019(. . 2011-12 ) ITA NO. 3295/MUM/2019 (A.Y.2011-12) ASSTT. COMMISSIONER OF INCOME TAX 12(2)(1), ROOM NO.128E, 1 ST FLOOR, AAYKAR BHAVAN, M.K.ROAD, MUMBAI 400 020 ...... / / APPELLANT VS. M/S. EHARA ENGINEERING PVT. LTD., GALA NO.3 & 7, SANT BHAWAN, SHARMA INDUSTRIAL ESTATE, WALBHAT ROAD, GOREGAON EAST, MUMBAI 400 063 PAN: AAACE2667E ..... 01/ RESPONDENT /2/ APPELLANT BY : SHRI AMIT PRATAP SINGH 012/ RESPONDENT BY : NONE 31 / DATE OF HEARING : 21/09/2020 45 31 / DATE OF PRONOUNCEMENT : 21/09/2020 $/ ORDER PER VIKAS AWASTHY, JM: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-20, MUMBAI (IN SHORT THE CIT (A)) 2 ITA NO.3295/MUM/2019 (A.Y.2011-12) DATED 14/03/2019 FOR THE ASSESSMENT YEAR 2011-12 D ELETING PENALTY LEVIED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961( HEREIN AFTER REFERRED TO AS THE ACT) 2. SHRI AMIT PRATAP SINGH, REPRESENTING THE DEPART MENT SUBMITTED THAT THE ASSESSING OFFICER HAD MADE ADDITION VIDE ASSESSMENT ORDER DATED 28/07/2016 PASSED U/S.143(3) R.W.S. 147 OF THE ACT ON ACCOUNT OF BOGUS PURCHASES. THE ASSESSING OFFICER MADE ADDITION TO THE EXTENT OF 12 .5% OF THE TOTAL BOGUS PURCHASES. THE ASSESSING OFFICER, THEREAFTER, ON T HE ADDITION MADE INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. THE ASSESSING OFFICER VIDE ORDER DATED 30/01/2017 LEVIED PENALTY OF RS.1,61,102/- U/ S. 271(1)(C) OF THE ACT. THE CIT(A) DELETED THE PENALTY HOLDING THAT NO PENALTY CAN BE LEVIED ON ADDITION MADE ON ESTIMATE BASIS. THE LD. DEPARTMENTAL REPRE SENTATIVE VEHEMENTLY DEFENDED THE ACTION OF ASSESSING OFFICER IN LEVYING PENALTY AND PRAYED FOR REVERSING THE FINDINGS OF CIT(A). 3. WE HAVE HEARD THE SUBMISSION MADE BY LD. DEPARTM ENTAL REPRESENTATIVE AND HAVE EXAMINED THE DOCUMENTS AVAI LABLE ON RECORD. A PERUSAL OF THE PENALTY ORDER DATED 30/01/2017 REVEA L THAT THE ADDITION IN RESPECT OF BOGUS PURCHASES WAS MADE ON MERE ESTIMAT IONS. THE CIT(A) HAS DELETED THE PENALTY BY PLACING RELIANCE ON THE DECI SION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF HARIGOPAL SINGH V S. CIT REPORTED AS 258 ITR 85(P&H). IT IS A WELL SETTLED LEGAL POSITION THAT N O PENALTY CAN BE LEVIED ON ESTIMATED ADDITIONS. THE HONBLE HIGH COURT HELD TH AT WHERE THE ADDITION IN THE INCOME WERE MADE ON ESTIMATE BASIS THAT ITSELF DOES NOT LEAD TO THE CONCLUSION THAT THE ASSESSEE EITHER CONCEALED THE P ARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. T HERE HAS TO BE A POSITIVE ACT OF CONCEALMENT ON THE PART OF THE ASSESSEE AND ONUS TO PROVE THIS IS ON THE 3 ITA NO.3295/MUM/2019 (A.Y.2011-12) DEPARTMENT. THUS, WHERE THE ADDITION IS MADE MERELY ON ESTIMATION, THE PROVISIONS OF SECTION 271(1)(C) OF THE ACT ARE NOT ATTRACTED. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) . THE IMPUGNED ORDER IS UPHELD AND THE APPEAL OF THE REVENUE IS DISMISSED B EING DEVOID OF ANY MERIT. 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON MONDAY THE 21 ST DAY OF SEPTEMBER, 2020. SD/- SD/- (MANOJ KUMAR AGGARWAL) ( VIKAS AWASTHY) $% / ACCOUNTANT MEMBER / JUDICIAL MEMBER / MUMBAI, 7/ DATED: 21/09/2020 VM , SR. PS(O/S) COPY OF THE ORDER FORWARDED TO : 1. / / THE APPELLANT , 2. 01 / THE RESPONDENT. 3. 81 ( )/ THE CIT(A)- 4. 81 CIT 5. 9:01 , . . . , / DR, ITAT, MUMBAI 6. :;<=> / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI