ACIT 21(3), MUMBAI V. SHRI ZAVERCHAND DAMJI HARIA, MUMBAI

ITA 3902/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 4673 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2011-2012
• Appeal Filed On: 31-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T S KHALSA LD SR
• Assessee Lawyers: CHHANGUR SHRIKANT CHAUHANLD
• Keywords: Bogus purchase
• Section: 143(3)

Judgement Text

ITA NO.3902/MUM/2019 SHRI ZAVERCHAND DAMJI HARIA ASSESSMENT YEAR: 2011-12 1 IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI , , BEFORE HONBLE SHRI MANOJ KUMAR AGGARWAL, AM AND HONBLE SHRI RAVISH SOOD, JM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO.3902/MUM/2019 ( / ASSESSMENT YEAR: 2011-12) A CIT - 21(3) ROOM NO.209, 2 ND FLOOR PIRAMAL CHAMBERS, PAREL MUMBAI-400 012 / VS. SHRI ZAVERCHAND DAMJI HARIA 124, ASHISH INDUSTRIAL ESTATE GOKHALE ROAD, MUMBAI-400 025 ./ ./PAN/GIR NO. AALPH-7225-H ( ' /APPELLANT ) : ( #$ ' / RESPONDENT ) ASSESSEE BY : SHRI CHHANGUR SHRIKANT CHAUHAN-LD. AR REVENUE BY : SHRI T.S. KHALSA- LD. SR.AR / DATE OF HEARING : 11/02/2021 / DATE OF PRONOUNCEMENT : 11/02/2021 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEAL BY REVENUE FOR ASSESSMENT YEAR [IN SHORT REFERRED TO AS AY] 2011-12 CONTEST THE ORDER OF L D. COMMISSIONER OF INCOME-TAX (APPEALS)-33 MUMBAI [IN SHORT REFERRE D TO AS CIT(A)], APPEAL NO.CIT(A)-33/RG.21/696/2016-17 DA TED 13/03/2019 WHICH HAS RESTRICTED THE ADDITION ON ACC OUNT OF ALLEGED BOGUS PURCHASES TO THE EXTENT OF 12.5% BY RELYING U PON CERTAIN ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR SA ME YEAR. ITA NO.3902/MUM/2019 SHRI ZAVERCHAND DAMJI HARIA ASSESSMENT YEAR: 2011-12 2 2. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS A ND PERUSED THE RELEVANT MATERIAL ON RECORD. THE LD. DR PLEADED FOR CONFIRMATION OF ADDITION AS MADE BY LD. AO WHEREAS LD. AR RELIED UP ON THE ESTIMATION MADE IN THE IMPUGNED ORDER. OUR ADJUDICA TION TO THE SUBJECT MATTER OF APPEAL WOULD BE AS GIVEN IN SUCCE EDING PARAGRAPHS. 3.1 THE MATERIAL FACTS ARE THAT THE ASSESSEE BEING RESIDENT INDIVIDUAL ENGAGED IN MANUFACTURING OF GARMENTS UND ER PROPRIETORSHIP CONCERN NAMELY M/S ZEAL APPAREL WAS ASSESSED FOR THE YEAR UNDER CONSIDERATION U/S 143(3) R.W.S. 147 VIDE ORDER DATED 15/12/2016. THIS WAS SECOND REOPENING IN CASE OF AS SESSEE, SINCE THE ASSESSMENT WAS ALREADY FRAMED U/S 143(3) R.W.S. 147 ON 31/03/2015. 3.2 THE SECOND REOPENING STEM FROM THE FACT THAT PU RSUANT TO RECEIPT OF CERTAIN INFORMATION FROM SALES TAX DEPAR TMENT REGARDING PROCUREMENT OF BOGUS BILLS BY ASSESSEE FROM SUSPICI OUS DEALERS, IT WAS ALLEGED THAT THE ASSESSEE MADE BOGUS PURCHASES AGGREGATING TO RS. 45.02 LACS FROM TWO ENTITIES, THE DETAILS OF WHICH HAS ALREADY BEEN EXTRACTED IN PARA 3.1 OF THE ASSESSMENT ORDER. THOUGH, THE ASSESSEE STATED THAT THE PURCHASES WERE GENUINE AND PAYMENT TO THE SUPPLIERS WAS THROUGH BANKING CHANNELS, HOWEVER , OBSERVING THAT THE ASSESSEE COULD NOT CONCLUSIVELY CO-RELATE THE PURCHASES WITH UTILIZATION OF THE MATERIAL, LD. AO ESTIMATED ADDITION OF 25% AGAINST THESE PURCHASES. 3.3 IT COULD BE OBSERVED THAT SIMILAR ADDITIONS WER E MADE IN THE FIRST ROUND OF RE-OPENED ASSESSMENT FRAMED U/S 143( 3) R.W.S. 147 ON 31/03/2015, WHEREIN THE ASSESSEE WAS SADDLED WIT H SIMILAR ITA NO.3902/MUM/2019 SHRI ZAVERCHAND DAMJI HARIA ASSESSMENT YEAR: 2011-12 3 DISALLOWANCES OF PURCHASES. HOWEVER, LD. CIT(A) RES TRICTED THE ADDITION TO 25%. UPON FURTHER APPEAL, THE CO-ORDINA TE BENCH, VIDE ITA NO.300/MUM/2017 ORDER DATED 19/09/2018, RELYING UPON THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS SIMIT P.SHETH (356 ITR 451) RESTRICTED THE ADDITION TO THE EXTENT OF 12.5% OF THE PURCHASES UNDER CONSIDERATION. 4. FOLLOWING THE SAID DECISION OF TRIBUNAL IN ITA NO.300/MUM/2017, LD. CIT(A) DIRECTED LD. AO TO ESTI MATE THE ADDITIONS @12.5%. THOUGH THE ASSESSEE HAS ACCEPTED THE VERDICT OF LD. CIT(A), HOWEVER, THE REVENUE IS IN FURTHER A PPEAL BEFORE US BY WAY OF PRESENT APPEAL. 5. UPON PERUSAL OF IMPUGNED ORDER, IT IS QUITE EVID ENT THAT THE ESTIMATIONS AS MADE BY LD.CIT(A) IS IN LINE WITH TH E ESTIMATION MADE BY THE TRIBUNAL IN FIRST ROUND IN ASSESSEES O WN CASE. FACTS BEING QUITE SIMILAR, WE DO NOT FIND ANY REASON TO D EVIATE FROM THE SAME. THEREFORE, WE DISMISS THE REVENUES APPEAL. 6. THE APPEAL STAND DISMISSED IN TERMS OF OUR ABOVE ORDER. ORDER PRONOUNCED ON 11 TH FEBRUARY, 2021. SD/- SD/- (RAVISH SOOD) (MANO J KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 11/02/2021 SR.PS, KASARLA THIRUMALESH ! / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #$ ' / THE RESPONDENT 3. + ( ) / THE CIT(A) 4. + / CIT CONCERNED 5. ,-#&. , . , / DR, ITAT, MUMBAI 6. -/01 / GUARD FILE ITA NO.3902/MUM/2019 SHRI ZAVERCHAND DAMJI HARIA ASSESSMENT YEAR: 2011-12 4 / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.