ITO 33(1)(2), MUMBAI V. M/S BALAJI ENTERPRISES, MUMBAI

ITA 413/MUM/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0623 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-03-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 29-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R BHOOPATHI
• Keywords: Bogus purchase
• Section: 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , ! BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . ITA NO.412/MUM/2019(A.Y.2009-10) . ITA NO.413/MUM/2019(A.Y.2010-11) . ITA NO.414/MUM/2019(A.Y.2011-12) ITO -33(1)(2) PRATYAKSHKAR BHAVAN, C-12, 7 TH FLOOR, ROOM NO.704, BKC, BANDRA(E) MUMBAI 400 051 ...... # / APPELLANT VS. M/S. BALAJI ENTERPRISES, PLOT NO.403, B-WING, NANASAHEB APTS., AKURLI ROAD, KANDIVALI (EAST), MUMBAI 400 101 PAN: AAIFB7666D ..... &'/ RESPONDENT #(/ APPELLANT BY : SHRI R. BHOOPATHI &'(/ RESPONDENT BY : )*/ NONE +' / DATE OF HEARING : 23/01/2020 , +' / DATE OF PRONOUNCEMENT : 12/03/2020 / ORDER THESE THREE APPEALS BY THE REVENUE ARE DIRECTED AG AINST THE ORDERS OF COMMISSIONER OF INCOME TAX (APPEALS)-45, MUMBAI (IN SHORT THE CIT(A) ) FOR THE ASSESSMENT YEARS 2009-10,2010-11 & 2011-12 RESP ECTIVELY. THE IMPUGNED 2 . ITA NO.412/MUM/2019(A.Y.2009-10) . ITA NO.413/MUM/2019(A.Y.2010-11) . ITA NO.414/MUM/2019(A.Y.2011-12) ORDERS BY THE CIT(A) IN ALL THE THREE APPEALS ARE O F EVEN DATE I.E. 26/04/2016. SINCE, THE FACTS GERMANE TO ISSUE IN ALL THE ASSES SMENT YEARS ARE SIMILAR AND THE GROUNDS RAISED BY THE REVENUE IN ALL APPEALS AR E IDENTICAL, THESE APPEALS ARE TAKEN UP TOGETHER FOR ADJUDICATION AND ARE DISP OSED OF BY THIS COMMON ORDER. FOR THE SAKE OF CONVENIENCE, THE FACTS ARE EXTRACTED FROM THE APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 2009-10. 2. THE BRIEF FACTS AS EMANATING FROM RECORDS ARE: I NFORMATION WAS RECEIVED BY THE ASSESSING OFFICER FROM INVESTIGATION WING OF THE DEPARTMENT THAT THE ASSESSEE HAS INDULGED IN OBTAINING BOGUS PURCHASE B ILLS FROM DECLARED HAWALA DEALERS AMOUNTING TO RS.18,86,384/-. THE NOTICE U NDER SECTION 148 WAS DULY SERVED ON THE ASSESSEE. DESPITE SERVICE OF NOTICE THE ASSESSEE FAILED TO APPEAR BEFORE THE ASSESSING OFFICER. SINCE DESPITE REPEAT ED NOTICES, THE ASSESSEE FAILED TO APPEAR, THE ASSESSING OFFICER WAS CONSTRA INED TO PASS ASSESSMENT ORDER AFTER INVOKING THE PROVISIONS OF SECTION 14 4 OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT). THE ASSESSING OFFICER MADE ADDITION OF THE ENTIRE ALLEGED BOGUS PURCHASES MADE BY THE ASSESSEE DURING THE REL EVANT PERIOD. AGGRIEVED AGAINST ASSESSMENT ORDER DATED 21/03/2016 PASSED UN DER SECTION 144 R.W.S. 147 OF THE ACT, THE ASSESSEE FILED APPEAL BEFORE T HE CIT(A). THE CIT(A) AFTER EXAMINING FACTS OF THE CASE RESTRICTED THE ADDITION TO 12.5% OF THE ALLEGED BOGUS PURCHASES I.E. RS.2,35,798/-. HENCE, THE PRE SENT APPEAL BY THE REVENUE. 3. SHRI R. BHOOPATHI, REPRESENTING THE DEPARTMENT S UBMITTED THE THAT ASSESSEE HAS FAILED TO PROVE GENUINENESS OF THE P URCHASES. RATHER, THE ASSESSEE HAS NOT APPEARED BEFORE THE ASSESSING OFFI CER AT ALL. NO MATERIAL WAS BROUGHT ON RECORD BY THE ASSESSEE IN THE FORM OF IN VOICE, LORRY RECEIPTS, STOCK 3 . ITA NO.412/MUM/2019(A.Y.2009-10) . ITA NO.413/MUM/2019(A.Y.2010-11) . ITA NO.414/MUM/2019(A.Y.2011-12) REGISTER, ETC. TO SUBSTANTIATE GENUINENESS OF THE P URCHASES. THE LD. DEPARTMENTAL REPRESENTATIVE PRAYED FOR REVERSING TH E FINDINGS OF CIT(A) AND CONFIRMING THE ASSESSMENT ORDER. 4. I HAVE HEARD THE SUBMISSIONS MADE BY LD. DEPARTM ENTAL REPRESENTATIVE AND HAVE PERUSED THE ORDERS OF THE AUTHORITIES BELO W. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF PILING, DRILLING, FABRICATION AN D CIVIL CONSTRUCTION AND MANUFACTURING OF MACHINES FOR THE SAME. THE ASSESS EE ALLEGEDLY MADE BOGUS PURCHASES TO THE TUNE OF RS.18,86,384/- FROM DECLAR ED HAWALA DEALERS. THE SALES DECLARED BY THE ASSESSEE HAVE NOT BEEN DISPUT ED BY THE REVENUE. THUS, WITHOUT PURCHASE OF RAW MATERIAL, THERE CANNOT BE MANUFACTURING, HENCE, THE ENTIRE BOGUS PURCHASES CANNOT BE ADDED. IT IS ONLY PROFIT EMBEDDED IN DISPUTED PURCHASES THAT HAS TO BE BROUGHT TO TAX. THE CIT(A) AFTER EXAMINING THE FACTS OF THE CASE HAS RESTRICTED THE ADDITION TO 12.5% OF THE ALLEGED BOGUS PURCHASES. I FIND THE IMPUGNED ORDER WELL REASONE D AND JUSTIFIED AND HENCE, DOES NOT WARRANT ANY INTERFERENCE. ACCORDINGLY, T HE SAME IS UPHELD AND THE APPEAL OF THE REVENUE IS DISMISSED BEING WITHOUT AN Y MERIT. ITA NO.413/MUM/2019 (A.Y. 2010-11): 5. THE FACTS IN THE ASSESSMENT YEAR 2010-11 ARE ID ENTICAL TO THE FACTS IN ASSESSMENT YEAR 2009-10, EXCEPT FOR THE AMOUNT OF ADDITION. THE ASSESSING OFFICER IN ASSESSMENT YEAR 2010-11 HAS MADE ADDITI ON OF RS.11,78,575/- IN RESPECT OF BOGUS PURCHASES. SINCE, THE FACTS ARE SIMILAR AND THE GROUNDS RAISED BY THE REVENUE ASSAILING FINDINGS OF CIT(A) ARE IDE NTICAL TO THE ONE RAISED IN 2009-10, THE FINDINGS GIVEN WHILE ADJUDICATING THE APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 2009-10 WOULD MUTATIS MUTANDIS APP LY TO THE ASSESSMENT 4 . ITA NO.412/MUM/2019(A.Y.2009-10) . ITA NO.413/MUM/2019(A.Y.2010-11) . ITA NO.414/MUM/2019(A.Y.2011-12) YEAR 2010-11 AS WELL. FOR THE SIMILAR REASONS, TH E APPEAL OF THE REVENUE IS DISMISSED BEING DEVOID OF ANY MERIT. ITA NO.414/MUM/2019,A.Y. 2011-12: 6. THE FACTS IN THE ASSESSMENT YEAR 2011-12 ARE ID ENTICAL TO THE FACTS IN ASSESSMENT YEAR 2009-10, EXCEPT FOR THE AMOUNT OF ADDITION. THE ASSESSING OFFICER IN ASSESSMENT YEAR 2011-12 HAS MADE ADDITI ON OF RS.17,97,258/- IN RESPECT OF BOGUS PURCHASES. SINCE THE FACTS ARE S IMILAR AND THE GROUNDS RAISED BY THE REVENUE ASSAILING FINDINGS OF CIT(A) ARE IDE NTICAL TO THE ONE RAISED IN 2009-10, THE FINDINGS GIVEN WHILE ADJUDICATING THE APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 2009-10 WOULD MUTATIS MUTANDIS APP LY TO THE ASSESSMENT YEAR 2011-12 AS WELL. FOR THE SIMILAR REASONS, TH E APPEAL OF THE REVENUE IS DISMISSED BEING DEVOID OF ANY MERIT. 7. TO SUM UP, ALL THE THREE APPEALS BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THURSDAY TH E 12 TH DAY OF MARCH, 2020. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, ./ DATED12/03/2020 VM , SR. PS(O/S) 5 . ITA NO.412/MUM/2019(A.Y.2009-10) . ITA NO.413/MUM/2019(A.Y.2010-11) . ITA NO.414/MUM/2019(A.Y.2011-12) COPY OF THE ORDER FORWARDED TO : 1. # / THE APPELLANT , 2. &' / THE RESPONDENT. 3. /' ( )/ THE CIT(A)- 4. /' CIT 5. 23&' , . . . , / DR, ITAT, MUMBAI 6. 34567 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI