PARASINGH B. PARMAR, MUMBAI V. ITO 19(2)(5), MUMBAI

ITA 3966/MUM/2017

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9156 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 31-05-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N HEMALATHA
• Assessee Lawyers: NAVEEN KUMAR MISHRA
• Keywords: Bogus purchase

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, AM ITA NO. 3966 / MUM/20 17 & 3967/MUM/2017 ( ASSESSMENT YEAR : 2010 - 11 & 2011 - 12 ) SHRI PARASINGH B PARMAR 1 ST FLOOR, ROOM NO.3, PANDYA HOUSE, 2 ND CARPENTER STREET, S.V. RO AD MUMBAI - 400 004 VS. ITO 19(2)(5) 2 ND FLOOR, MATRU MANDIR GRANT ROAD, MUMBAI 400 007 PAN/GIR NO. AKYPP6429J APPELLANT ) .. RESPONDENT ) ASSESSEE BY SHRI NAVEEN KUMAR MISHRA REVENUE BY MS. N. HEMALATHA DATE OF HEARING 04 / 10 /201 7 DATE OF PRONOUNCEME NT 16 / 10 /201 7 / O R D E R PER R.C.SHARMA (A.M) : THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - 29, MUMBAI DATED 05/04/2017 FOR A.Y.2010 - 11 AND 2011 - 12 IN THE MATTER OF ORDER PASSED U /S.143(3) R.W.S. 147 OF THE IT ACT. 2. IN BOTH THE YEARS, ASSESSEE IS AGGRIEVED FOR UPHOLDING ADDITION BY ESTIMATING PROFIT OF 5% ON THE ALLEGED BOGUS PURCHASES. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. 4. ON THE BASIS OF INFORMATION FROM S ALES TAX DEPARTMENT, AO FOUND THAT ASSESSEE HAS MADE SOME PURCHASES FROM HAWALA DEALERS. ON FINDING THA T GOODS WERE ACTUALLY PURCHASED BUT NOT FROM THE VERY SAME DEALER, THE AO ESTIMATED PROFIT OF 12.5% ON SUCH PURCHASES AND ADDED THE SAME IN ASSESSEES IN COME. ITA NO. 3966/MUM/2017 & 3967/MUM/2017 M/S. PARASINGH B PARMAR 2 5. BY THE IMPUGNED ORDER CIT(A) UPHELD THE ADDITION TO THE EXTENT OF 5% AGAINST WHICH ASSESSEE IS IN FURTHER APPEAL BEFORE US. 6. IT WAS ARGUED BY LEARNED AR THAT ONLY ON THE BASIS OF INFORMATION FROM SALES TAX DEPARTMENT, THE AO HAS JUMPED TO THE C ONCLUSION THAT ASSESSEE HAS MADE BOGUS PURCHASES. AS PER LEARNED AR, ASSESSEE HAS ALSO ASKED FOR CROSS EXAMINATION BUT THE SAME WAS NOT PROVIDED. OUR ATTENTION WAS ALSO INVITED TO PARA 4.3.1 OF THE CIT(A)S ORDER WHEREIN SUCH REQUEST OF ASSESSEE WAS DECLIN ED. 7. ON THE OTHER HAND, LEARNED DR CONTENDED THAT CIT(A) HAS VERY REASONABLY ESTIMATED EXTRA PROFIT AT 5%. 8. I HAVE CONSIDERED RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND THAT ADDITION HAS BEEN MADE BY ESTI MATING PROFIT ON THE PURCHASES MADE FROM HAWALA DEALERS. HOWEVER, THE CORRESPONDING SALES OF THE GOODS SO PURCHASED HAVE NOT BEEN DECLINED. IT IS ALSO A MATTER OF RECORD THAT ASSESSEE HAS ASKED FOR CROSS EXAMINATION OF THE SUPPLIERS ON WHOSE STATEMENT AO H AS CONCLUDED THAT THESE WERE THE BOGUS SUPPLIERS. HOWEVER, ASSESSEE WAS NOT GIVEN OPPORTUNITY TO CROSS EXAMINE THE SAID SUPPLIERS. KEEPING IN VIEW THE TOTALITY OF FACTS AND CIRCUMSTANCES OF THE CASE VIS - - VIS NATURE OF TRADING ACTIVITY THE ASSESSEE IS ENGAGED IN AND THE RATE OF G.P. DECL AR ED BY ASSESSEE, I DEEM IT APPROPRIATE TO UPHOLD THE ADDITION OF 2% ON SUCH PURCHASES. I DIRECT ACCORDINGLY. ITA NO. 3966/MUM/2017 & 3967/MUM/2017 M/S. PARASINGH B PARMAR 3 9. IN THE RESULT, APPEALS OF ASSESSEE ARE ALLOWED IN PART. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 16 / 10 /2017 S D/ - ( R.C.SHARMA ) ACCOUNTANT MEMBER MUMBAI ; DATED 16 / 10 /201 7 KARUNA SR. 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//