BABAN PIRAJI GHADGE, MUMBAI V. DCIT CIRCLE-2, KALYAN

ITA 4550/MUM/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 5938 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 20-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHAITANYA ANJARIA
• Assessee Lawyers: RIYA MOHINI
• Keywords: Bogus purchase; Opportunity of being heard; Question of law
• Section: 40A(3)

Judgement Text

T HE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA ( A M) I.T.A. NO. 4550 /MUM/ 201 8 (ASSESSMENT YEAR 20 11 - 1 2 ) BABAN PIRAJI GHADGE C/O. RCS & ASSOCIATES 1307, MAYURESH COSMOS TOWERS, SAROVAR VIHAR ROAD SECTOR - 11, CBD BELAPUR NAVI MUMBAI - 400 614. PAN : AEGPG2860J V S . DCIT CIRCLE - 2 2 ND FLOOR, MOHAN PLAZA, VAYALE NAGAR KHADAKPADA KALYAN - WEST MAHARASHTRA. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY MS. RIYA MOHINI DEPARTMENT BY SHRI CHAITANYA ANJARIA DATE OF HEARING 4 . 7 . 201 9 DATE OF PRONOUNCEMENT 29 . 7 . 201 9 O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDERS OF LEARNED CIT - A DATED 2.4.2018 AND PERTAINS TO ASSESSMENT YEAR 2011 - 12 . 2. T HE FIRST ISSUE RAISED PERTAINS TO CONFIRMATION OF DISALLOWAN CE OF BOGUS PURCHASE AT RS. 4,70,329/ - . 3. THE SECOND ISSUE RAISED IS TO CONFIRMATION OF DISALLOWANCE ON ACCOUNT OF CAS EXPENSES APPLICATION OF THE PROVISION OF SECTION 40A(3) AT RS 1,00,765/ - 4. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS ENGAGED IN TH E BUSINESS OF CONSTRUCTION. PURSUANT TO RECEIPT OF INFORMATION THAT ASSESSEE HAS INDULGED IN BOGUS PURCHASES AMOUNTING TO RS. 4,70,329/ - . T HE ADDITION WAS MADE TO THE EXTENT OF HUNDRED PERCENT OF THE BOGUS PURCHASE. THE LEARNED CIT - A ALSO CONFIRMED THE SAM E ON A FINDING THAT ASSESSEE DID NOT PRODUCE EVEN THE VOUCHERS. LEARNED CIT - A NOTED THAT ASSESSEE HAS ONLY PRODUCED THE LEDGER ACCOUNT OF PURCHASES. AS REGARDS THE DISALLOWANCE OF EXPE NDITURE IN CASH BABAN PIRAJI GHADGE 2 EXCEEDING RS. 20,000 / - , THE ASSESSING OFFICER NOTED THAT ASSESSEE'S COUNSEL HAD AGREED FOR THE SAME . L EARNED CIT - A ALSO CONFIRMED THE SAME. 5. THIS ORDER HAS BEEN CHALLENGED BEFORE THE ITAT. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. AS REGARDS THE DISALLOWANCE UNDER SECTION 40A(3). I NOTE THAT I T IS THE CONTENTION OF THE ASSESSEE THAT ALL THE CASH PAYMENTS EXCEEDING RS. 20,000 IN CASH WERE FALLING UNDER THE EXCEPTION PROVIDED UNDER THE ACT. HENCE IT IS PLEADED THAT NO DISALLOWANCE IN THIS REGARD SHOULD BE DONE. I NOTE THAT AUTHORITIES BELOW HAVE NOTED THAT ASSESSEE'S REPRESENTATIVE HAS AGREED FOR THE DISALLOWANCE . H OWEVER I FIND THAT THIS ISSUE IS A MIXED QUESTION OF LA W AND FACT. HONOURABLE SUPREME C OURT HAD HELD THAT CONCESSION ON MIXED QUESTION OF LAW AND FACT DOESN'T PRECLUDE THE AGGRIEVED PAR TY IN CHALLENGING THE SAME. ACCORDINGLY IN THE INTEREST OF JUSTICE I REMIT THIS ISSUE THE FILE OF ASSESSING OFFICER. THE ASSESSING OFFICER IS DIRECTED TO CONSIDER THE ISSUE AFRESH AFTER GIVING THE ASSESSEE PROPER 7 OPPORTUNITY OF BEING HEARD. 6. AS REGARDS THE DISALLOWANCE ON ACCOUNT OF BOGUS PURCHASE, I NOTE THAT THE SAME HAS BEEN DONE @ 100% OF THE BOGUS PURCHASE ON THE PLEA THAT ASSESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE THE PURCHASES. I ALSO NOTE THAT THERE IS NO OTHER FINDING THAT THERE IS ANY SHORTCO MING IN THE OTHER RESULTS OF THE ASSESSEE. HENCE IN THE INTEREST OF JUSTICE I REMIT THIS ISSUE ALSO FOR THE ASSESSING OFFICER TO EXAMINE AFRESH AFTER GIVING THE ASSESSEE PROPER OPPORTUNITY OF BEING HEARD. 7. IN THE RESULT APPEAL BY THE ASSESSEE STANDS AL LOWED FOR STATISTICAL PURPOSES. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 29 . 7 . 201 9 . SD/ - (SH A MIM YAHYA ) ACCOUNTANT MEMBER MUMBAI ; DATED : 29 / 7 / 20 1 9 COPY OF THE ORDER FORWARDED TO : BABAN PIRAJI GHADGE 3 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR ) PS ITAT, MUMBAI