M/s. Randhawa Engineering Works, Delhi V. ITO, New Delhi

ITA 4586/DEL/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6976 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 16-01-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 29-08-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V K PRASANTH
• Assessee Lawyers: BISHNU BHAGWAN GUPTA
• Keywords: Bogus purchase; Accommodation entries

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SM C , NEW DELHI BEFORE SH. R. S. SYAL, ACCOUNTANT MEMBER ITA NO. 4586 /DEL/201 6 : ASSTT. YEAR : 2007 - 08 M/S RANDHAWA ENGINEERING WORKS, B - 50, G.T. KARNAL ROAD, AZADPUR, DELHI - 110033 VS INCOME TAX OFFICER, WARD - 36(5 ), NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. AA A FR3861L A SSESSEE BY : SH. BISHNU BHAGWAN GUPTA , ADV. REVENUE BY : SH. V. K. PRASANTH, SR. DR DATE O F HEARIN G : 16.01 . 201 7 DATE O F PRONOUNCEMENT : 17 . 01 .201 7 ORDER THIS APPEAL BY THE ASSESSEE ARISE S OUT OF THE ORDER PASSED BY THE CIT(A) - 12 ON 27.06.2016 IN RELA TION TO THE ASSESSMENT YEAR 2007 - 08 . 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST THE CONFIRMATION OF ADDITION OF RS.1,43,131/ - ON ACCOUNT OF BOGUS PURCHASES. 3. THE FACTS APROPOS THIS GROUND ARE THAT THE AO RECEIVED INFORMATION FROM ADDL. CIT, CENTRAL, RANGE - 4, NEW DELHI THAT SH. VAIBHAV JAIN AND SH. NAVNEET JAIN E TC. WERE INDULGING IN PROVIDING ACCOMMODATION ENTRIES THROUGH THEIR 37 PAPER ENTITIES AND CHARGING COMMISSION FROM THE BENEFICIARIES ON SUCH ACCOMMODATION ENTRIES. THE ASSESSEE HAD SHOW N TO HAVE MADE PURCHASE S AMOUNTING TO RS.1,43,131/ - FROM M/S BALAJI ITA NO. 4586/DEL/2016 RANDHAWA ENGINEERING WORKS 2 TRA DING CO., A CONCERN IN THE BOTH THE ABOVE PERSONS WERE INTERESTED. THE ASSESSEE WAS CALLED UPON TO PRODUCE PROPRIETOR/PARTNER OF M/S BALAJI TRADING CO. F O R PROV ING THE GENUINENESS OF THE TRANSACTION S O F PURCHASE OF GOODS , WHICH THE ASSESSEE FAIL ED TO DO. A CCORDINGLY, SUCH PURCHASES AMOUNTING TO RS.1,43,131/ - WERE ADDED TO THE ASSESSEE S TOTAL INCOME . NO RELIEF WAS ALLOWED IN THE FIRST APPEAL. THE ASSESSEE IS AGGRIEVED AGAINST SUCH ADDITION. 4. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE LD. AR HAS PLACED ON RECORD A COPY OF THE DIVISION BENCH ORDER DATED 08.03.2016, PASSED BY THE DELHI TRIBUNAL IN MOHINDER KUMAR KHANNA V S . ACIT (ITA NO. 6176/DEL/2015) IN WHICH THE TRIBUNAL UPHELD THE DECISION OF THE CIT(A) IN RESTR ICTING THE ADDITION TO 20% OF PURCHASES SHOWN FROM SUCH PARTIES PROVIDING ACCOMMODATION ENTRIES . THE LD. AR SUBMITTED THAT BOTH THE PERSONS , NAMELY , SH. NAVNEET JAIN AND SH. VAIBHAV JAIN WERE INV OLVED IN THE TRANSACTIONS OF THAT ASSESSEE AS WELL. IT WAS , T HEREFORE , PRAYED THAT A SIMILAR VIEW BE TAKEN IN THE INSTANT APPEAL AS WELL . NO CONTRARY DECISION OF THE TRIBUNAL WAS BROUGHT ON RECORD BY THE LD. DR. RESPECTFULLY FOLLOWING THE PRECEDENT, WE DIRECT THAT ADDITION ON ACCOUNT OF BOGUS PURCHASES BE RESTRICTED TO 20% OF THE AMOUNT OF PURCHASES , WHICH , IN QUANTITATIVE TERM S, MEANS SUSTENANCE OF ADDITION TO THE TUNE OF RS.28,626/ - . ITA NO. 4586/DEL/2016 RANDHAWA ENGINEERING WORKS 3 5 . IN THE RESULT, THE APPEAL IS PARTLY ALLOWED . ORDER PRONOU N CED IN T HE OPEN COURT ON 17 / 01 / 2017 . SD/ - (R. S. SYAL) ACCOUNTANT MEMBER DATED: 17 /01 / 2017 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR