ARIF ABBASBHAI KAMDAR, THANE V. ITO WD 1 PALGHAR,

ITA 440/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0939 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-05-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 29-01-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: RAHUL HAKANI LD
• Keywords: Bogus purchase
• Section: 143(3); 142(1); 133(6); 147; 148

Judgement Text

ITA NO.440/M/2016 ARIF ABBASBHAI KAMDAR ASSESSMENT YEAR- 2009-2010 IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI , , BEFORE SHRI MAHAVIR SINGH, JM AND SHRI MANOJ KUMAR AGGARWAL, AM ./I.T.A. NO.440/MUM/2016 ( / ASSESSMENT YEAR: 2009-2010) ARIF ABBASBHAI KAMDAR PROP. A.A.STEEL & TRADING CO. H.P.DALAL CHAWL PARNAKA DISTT. PALGHAR THANE 401 601 / VS. INCOME TAX OFFICER WARD-1 PALGHAR ./ ./PAN/GIR NO. AFZPK-8390-K ( /APPELLANT ) : ( !' / RESPONDENT ) / APPELLANT BY : SHRI RAHUL HAKANI, LD. AR !' / RESPONDENT BY : SHRI NAVEEN GUPTA, LD. DR / DATE OF HEARING : 01/05/2017 / DATE OF PRONOUNCEMENT : 01 /05/2017 ITA NO.440/M/2016 ARIF ABBASBHAI KAMDAR ASSESSMENT YEAR- 2009-2010 2 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. THE CAPTIONED APPEAL BY ASSESSEE FOR ASSESSMENT YEAR [AY] 2009-10 ASSAILS THE ORDER OF LD. COMMISSIONER OF IN COME TAX (APPEALS)- 3 [CIT(A)], THANE DATED 21/10/2015 QUA CONFIRMATION OF ADDITION OF BOGUS PURCHASES TO THE EXTENT OF 25%. THE LEGAL GROUND RAISED AGAIN ST REASSESSMENT HAS NOT BEEN PRESSED DURING PROCEEDING S BEFORE US AND HENCE, THE SAME IS DISMISSED AS BEING NOT PRESSED . 2. BRIEFLY STATED, THE ASSESSEE, BEING RESIDENT IND IVIDUAL, WAS SUBJECTED TO AN ASSESSMENT U/S 143(3) READ WITH SECTION 147 VIDE ASSESSING OFFICER [AO] ORDER DATED 30/12/2014 WHERE IN THE TOTAL INCOME OF THE ASSESSEE WAS DETERMINED AT RS.41,12,130/- AF TER MAKING ADDITION ON ACCOUNT OF BOGUS PURCHASES FOR RS. 36,72,973/- AS AGAINST RETURNED INCOME OF RS.4,39,160/- FILED BY THE ASSESSEE ON 10 /09/2009 WHICH WAS ORIGINALLY ASSESSED U/S 143(1). THE REASSESSMENT PR OCEEDINGS WERE TRIGGERED PURSUANT TO RECEIPT OF CERTAIN INFORMATIO N FROM SALES TAX DEPARTMENT WHEREIN CERTAIN DEALERS WERE FOUND TO HA VE INDULGED IN THE ISSUANCE OF ACCOMMODATION PURCHASES BILLS AND THE A SSESSEES NAME FIGURED IN THE LIST OF BENEFICIARIES OF SUCH ACCOMM ODATION BILLS. CONSEQUENTLY, THE CASE OF THE ASSESSEE WAS REOPENED U/S 147 BY ISSUANCE OF NOTICE U/S 148 DATED 10/05/2013 WHICH W AS DULY SERVED AND THE ASSESSEE VIDE NOTICE U/S 142(1) WAS ASKED TO FU RNISH THE REQUISITE INFORMATION / PURCHASE DETAILS WITH RESPECT TO 8 SU PPLIERS WHICH WERE LISTED AS SUSPICIOUS DEALERS AND FROM WHOM THE ASSE SSEE HAD MADE THE ITA NO.440/M/2016 ARIF ABBASBHAI KAMDAR ASSESSMENT YEAR- 2009-2010 3 IMPUGNED PURCHASES. THE ASSESSEE WAS ENGAGED AS DEALER OF CEMENT, CEMENT SHEET, STEEL AND OTHER BUILDING MATERIAL UNDER THE NAME AND STYLE OF A.A.STEEL & TRADING CO. THE ASSESSEE HAD MADE AGGREGATE PURCHASE OF RS.36,72,973/- FROM THE SAID SUPPLIERS TO WHOM NOTICES U/S 133(6) WERE ISSUED BUT COULD NOT BE SERVED FOR WANT OF AVA ILABILITY OF THESE CONCERNS AT THE GIVEN ADDRESSES. UPON BEING CONFRON TED, THE ASSESSEE SUBMITTED COPIES OF PURCHASE BILLS, TRANSPORT RECEI PTS ETC. TO SUBSTANTIATE THE PURCHASES AND CONTENDED THAT THE PURCHASES WERE GENUINE. HOWEVER, NOT CONVINCED, AO REJECTED ASSESSEES CONT ENTIONS AND MADE THE IMPUGNED ADDITIONS. 3. THE ASSESSEE ASSAILED THE SAME WITH PARTIAL SUCC ESS BEFORE LD. CIT(A) VIDE IMPUGNED ORDER DATED 21/10/2015 WHEREIN THE LD. CIT(A) AFTER CONSIDERING THE FACTUAL MATRIX AND PLACING RE LIANCE ON VARIOUS JUDICIAL PRONOUNCEMENTS, RESTRICTED THE IMPUGNED AD DITIONS TO 25%. STILL AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 4. THE LD. COUNSEL FOR ASSESSEE [AR] CONTENDED THAT THE ASSESSEE WAS IN POSSESSION OF VARIOUS PURCHASE DOCUMENTS COU PLED WITH PAYMENT PROOF THROUGH BANKING CHANNELS AND THEREFORE, THE P URCHASES COULD NOT BE DOUBTED MERELY ON THE BASIS OF OUTCOME OF 133(6) NOTICES. THE ASSESSEE, BEING A TRADER, SOLD THE GOODS WHICH WERE DULY ACCEPTED BY THE REVENUE AND THE ASSESSEE HAS RECONCILED THE QUA NTITATIVE DETAILS. THE LD. AR FURTHER CONTENDED THAT EVEN OTHERWISE ES TIMATION OF PROFIT @25% WAS ON THE HIGHER SIDE AS EARNING THIS MUCH OF PROFIT IN ASSESSEES BUSINESS WAS NOT POSSIBLE. 5. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE CONT ENDED THAT ADEQUATE RELIEF HAS ALREADY BEEN PROVIDED TO THE AS SESSEE BY LD. CIT(A) ITA NO.440/M/2016 ARIF ABBASBHAI KAMDAR ASSESSMENT YEAR- 2009-2010 4 DESPITE BEING INDULGING IN BOGUS PURCHASES AND THEREFORE, THE ASSESSEE DESERVES NO FURTHER RELIEF AS THE ONUS TO SUBSTANTI ATE THE PURCHASES SQUARELY LIED ON THE ASSESSEE WHICH HE HAS FAILED T O DISCHARGE. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT IN THE PRESENT CAS E, THE ASSESSEE, ON ONE HAND, COULD NOT PRODUCE THE SUPPLIER OR EVEN TH E CORRECT ADDRESSES OF THESE SUPPLIERS DESPITE HAVING BEEN MADE HEAVY P URCHASES FROM THESE PARTIES. SIMILARLY, THE REVENUE, ON THE OTHER HAND, HAS ALSO FAILED TO DISPROVE THE CLAIM OF THE ASSESSEE CONCLUSIVELY AS IT COULD NOT CONTROVERT THE QUANTITATIVE DETAILS OR SALES REVENU E EARNED BY THE ASSESSEE. THEREFORE, WE FIND LAPSES ON BOTH THE SI DES. THE TRIBUNAL, INVARIABLY, IN ALL SUCH CASES, HAVE TAKEN A STAND T HAT EVEN IF PRESUMING THAT ALL PURCHASES WERE BOGUS, ENTIRE ADDITION THER EOF WAS NOT WARRANTED FOR PARTICULARLY WHEN THE SALES WERE NOT IN DISPUTE AND THE ASSESSEE PROVIDED QUANTITATIVE DETAILS AND THE ADDITION, IF ANY, WHICH HAS TO BE MADE IN ALL SUCH CASES IS TO ACCOUNT FOR PROFIT ELE MENT EMBEDDED IN SUCH PURCHASE TRANSACTIONS. THEREFORE, AFTER DUE DISCUSS ION WITH BOTH THE REPRESENTATIVE, WE ESTIMATE THE ADDITION @12.5% OF BOGUS PURCHASES OF RS.36,72,973/- WHICH COMES TO RS.4,59,122/- AGAINST WHICH THE ASSESSEE SHALL BE ENTITLED FOR BENEFIT OF PROFIT AL READY DECLARED BY HIM QUA THESE PURCHASES. HOLDING SO, THE MATTER IS RESTORED BACK TO THE THE FILE OF LD. AO FOR LIMITED PURPOSE OF CALCULATING T HE FINAL ADDITIONS TO BE MADE IN THE HANDS OF THE ASSESSEE. THE ASSESSEE, IN TURN, IS DIRECTED TO PROVIDE NECESSARY INFORMATION IN THIS REGARD TO LD. AO FORTHWITH FAILING WHICH THE AO SHALL BE AT LIBERTY TO DECIDE ON THE B ASIS OF MATERIAL AVAILABLE ON RECORD. ITA NO.440/M/2016 ARIF ABBASBHAI KAMDAR ASSESSMENT YEAR- 2009-2010 5 7. THE ASSESSEES APPEAL STANDS PARTLY ALLOWED IN T ERMS OF OUR ABOVE ORDER. ORDER PRONOUNCED IN THE OPEN COURT ON 01 ST MAY, 2017. SD/- SD/- (MAHAVIR SINGH) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 01.05.2017 SR.PS:- 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. ./ / GUARD FILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI