JAINAM EXPORTS P.LTD, MUMBAI V. ITO 2(2)(1), MUMBAI

ITA 4615/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8509 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 04-07-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: BEENA SANTOSH
• Keywords: Bogus purchase

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI BEFORE SHRI R P TOLANI, JUDICIAL MEMBER ITA NO.4615/MUM/2016 ASSESSMENT YEAR : 2010-11 JAINAM EXPORTS LTD., 103/33, MALHOTRA CHAMBERS, POLICE LANE, DR D N ROAD, FORT, MUMBAI 400 001 PAN AAACJ8119Q VS. ITO 2(2)(1) , MUMBAI (APPELLANT) RESPONDENT) APPELLANTS BY : NONE RESPONDENT BY : MS. BEENA SANTOSH DATE OF HEARING : 3 1 .01.2017 DATE OF PRONOUNCEMENT : 3 1 .0 1 . 201 7 O R D E R PER R P TOLANI, JUDICIAL MEMBER THIS IS ASSESSEES APPEAL. FOLLOWING GROUND IS R AISED: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED ASSESSING OFFICER ERRED IN DISALLOWING 100% OF PURCHASE EXPENSES AMOUNTING TO RS.3,43,114/-. SUBSEQUENTLY, CIT(APPEALS)-5 ALLOWED THE APPEAL BY DELETING THE DEMAND OF 100% O F PURCHASE EXPENSES TO 12.5% OF EXPENSES AMOUNTING TO RS.42890 . 2. NONE APPEARED FOR THE ASSESSEE DESPITE ADJOURNME NT OF TODAY BEING GRANTED AS REQUESTED. CONSEQUENTLY, THE APPEAL IS DECIDED EXPARTE QUA THE ASSESSEE AFTER HEARING THE LEARNED DR AND PERUSING THE MATERIAL AV AILABLE ON RECORD. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE AO FOUN D THAT THE ASSESSEE HAS MADE BOGUS PURCHASES AND DISALLOWED 100% AMOUNT THEREOF. IN FIRST APPEAL, THE LEARNED ITA NO.4615/MUM/2016 JAINAM EXPORTS PVT. LTD. 2 CIT(A) REDUCED IT TO 12.5% CONSIDERING THE JUDGMENT OF HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. SMITH P D SHETH 356 ITR 146, HOLDING IT TO BE BENEFIT ELEMENT IN THE PURCHASES AND REDUCED THE ADDITION T O RS. 42,890/- AGGRIEVED, THE ASSESSEE IS IN APPEAL. 4. THE LEARNED DR CONTENDS THAT BECAUSE OF THE SMAL LNESS OF THE TAX DEMAND, REVENUE COULD NOT FILE THE APPEAL. FURTHER, 100% D ISALLOWANCE HAS BEEN HUGELY REDUCED TO 12.5% THAT TOO ON THE BASIS OF THE JUDGE MENT OF HONBLE GUJARAT HIGH COURT. THE ASSESSEE CANNOT HAVE ANY LEGITIMATE GRI EVANCE THEREON THAT IS THE REASON WHY THE ASSESSEE HAS REMAINED ABSENT. THERE FORE, HE CONTENDED THAT THE ORDER OF THE LEARNED CIT(A) MAY BE CONFIRMED. 5. I HAVE HEARD THE LEARNED DR AND HAVE GONE THROUG H THE MATERIAL AVAILABLE ON RECORD. I FIND MERIT IN THE CONTENTION OF THE LEAR NED DR. THE LEARNED CIT(A) HAS DRASTICALLY REDUCED THE DISALLOWED FROM 100% TO 12. 5% BY GIVING COGENT REASONS AND BY RELYING ON THE JUDGMENT OF HONBLE GUJARAT H IGH COURT IN THE CASE OF CIT VS. SMITH P D SHETH (SUPRA). I SEE NO INFIRMITY IN THE ORDER OF THE LEARNED CIT(A). 6. IN THE RESULT, THE ASSESSEES APPEAL IS DISMISSE D.. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 3 1 ST JANUARY, 2017. SD/- (R P TOLANI) J UDICIAL MEMBER MUMBAI, DATED :31 ST JANUARY, 2017. SA ITA NO.4615/MUM/2016 JAINAM EXPORTS PVT. LTD. 3 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE C I T(A), MUMBAI. 4. THE C I T 5. THE DR, SMC BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, MUMBAI