ACIT 23(1), MUMBAI V. INCOACH BUILDERS, MUMBAI

ITA 4728/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88597 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 16-03-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 19-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PREMANAND J
• Assessee Lawyers: KIRIT S SANGHVI
• Keywords: Bogus purchase

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES I, MUMBAI , . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER ITA NO.4728/MUM/2013 ASSESSMENT YEAR: 2007-08 ACIT-23(1), ROOM NO.108, C-10, 1 ST FLOOR, B.K.C, BANDRA (E), MUMBAI-400051 / VS. M/S INCOACH BUILDERS PLOT NO.1. L.B.SHASTRI MARG, VIKHROLI (W), MUMBAI-400078 ( / REVENUE) ( /ASSESSEE) P.A. NO. AAFI5110R / REVENUE BY SHRI PREMANAND J.-DR / ASSESSEE BY): SHRI KIRIT S. SANGHVI ! ' # / DATE OF HEARING : 16/03/2015 $%& ' # / DATE OF PRONOUNCEMENT : 16/03/2015 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) : THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER, FOR ASSESSMENT YEAR 2007-08, DATED 03/04/2013, OF THE L D. FIRST APPELLATE AUTHORITY, MUMBAI. THE ONLY GROUND RAISE D BY THE REVENUE PERTAINS TO DIRECTING THE ASSESSING OFFICER TO DELETE M/S INCOACH BUILDERS 2 THE ADDITION OF RS.19,15,964/- MADE ON ACCOUNT OF B OGUS PURCHASES WITHOUT APPRECIATING THAT THE ASSESSEE CO ULD NOT PROVE THE GENUINENESS OF THE PARTIES AND FURTHER TH E ASSESSEE DID NOT DISCHARGE THE ONUS CAST UPON IT. 2. DURING HEARING, THE LD. DR, SHRI PREMANAND J. BR OADLY DEFENDED THE CONCLUSION ARRIVED AT IN THE ASSESSMEN T ORDER BY SUBMITTING THAT THE ASSESSEE MADE BOGUS PURCHASES A ND EVEN ON ASKING BY THE ASSESSING OFFICER DID NOT PRODUCE THE CONCERNED PARTIES. IT WAS ALSO CONTENDED THAT THE CLAIMED PARTIES WERE NOT AVAILABLE AT THE GIVEN ADDRESS ON THE ENQUIRY MADE BY THE INSPECTOR. IT WAS ASSERTED THAT THE AS SESSING OFFICER ASKED THE ASSESSEE TO PRODUCE THESE PARTIES BUT WERE NOT PRODUCED. IT WAS CLAIMED TO BE A CASE OF HEAVY CASH TRANSACTION. 2.1. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASS ESSEE, SHRI KIRIT S. SANGHVI, DEFENDED THE CONCLUSION ARRIVED A T IN THE IMPUGNED ORDER BY SUBMITTING THAT BOTH THESE PARTIE S WERE NON-COOPERATIVE, CONSEQUENTLY, THE ASSESSEE COULD N OT PRODUCE THEM BUT ADDED THAT THE NECESSARY DETAILS O F TRANSACTIONS MADE FROM THESE PARTIES WERE PRODUCED. IT WAS ASSERTED THAT ON THE BASIS OF DOCUMENTS, PRODUCED B Y THE ASSESSEE, THE GENUINENESS OF THE TRANSACTION WAS PR OVED. 2.2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS, IN BRI EF, ARE THAT THE ASSESSEE IS A BUILDER OF BODIES FOR AUTOMOBILE/ VEHICLES, LIKE BUSES, TRUCKS, LORRIES, ETC. THE ASSESSEE FOR BUSINESS PURPOSES, USED TO BUY STEEL, ALUMINUM SHEETS, CHANN ELS AND ANGLE ETC. THE ASSESSEE MADE PURCHASES FROM VARIOU S PARTIES M/S INCOACH BUILDERS 3 INCLUDING M/S HARDIC METAL AND M/S. ALSTOM TRADING COMPANY PVT. LTD. AS PER THE ASSESSEE, PAYMENTS WER E MADE BY THE CHEQUES. HOWEVER, AS PER THE REVENUE, THERE WERE HUGE CASH TRANSACTION. THE ASSESSING OFFICER MADE ENQUIRIES FROM THE MARKET AND ALSO OBTAINED BANK STATEMENTS O F THESE PARTIES DIRECTLY FROM HDFC BANK AND FOUND THAT THE PARTIES HAVE WITHDRAWN CASH FROM THE ACCOUNTS AFTER DEPOSIT ING CHEQUES. THE LD. ASSESSING OFFICER MADE ENQUIRIES THROUGH HIS INSPECTOR BUT THE PARTIES WERE NOT TRACEABLE. THE ASSESSEE ALSO COULD NOT PRODUCE THESE PARTIES IN SPITE OF AS KING BY THE ASSESSING OFFICER AND FOUND HEAVY CASH TRANSACTION IN THE ACCOUNTS. CHEQUES WERE DEPOSITED OF HIGH VALUE AND THE AMOUNTS WERE WITHDRAWN IN CASH IMMEDIATELY. M/S AL STOM TRADING COMPANY PVT. LTD. WAS NOT FOUND AT THE GIV EN ADDRESS. THE ACCOUNTS OF THE PARTIES WERE EXAMINED AND HEAVY DEPOSITS/WITHDRAWAL OF CASH WERE NOTICED. TH E SUBMISSIONS OF THE ASSESSEE WERE EXAMINED BY THE AS SESSING OFFICER AND FINALLY FOUND THAT THE PURCHASES WERE B OGUS. ON APPEAL, THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) DELETED THE ADDITION AGAINST WHICH THE REVENUE IS AGGRIEVED AND IS IN APPEAL BEFORE THIS TRIBUNAL. 2.3. ON PERUSAL OF RECORD, AS ADMITTED BY THE ASSES SEE ALSO, THE SUMMONS COULD NOT BE SERVED TO THE PARTIES. EV EN AS PER THE INFORMATION FROM THE SALES TAX DEPARTMENT, THE ASSESSEE WAS FOUND INVOLVED IN BOGUS PURCHASES BY RECEIVING BOGUS BILLS OF PURCHASES FROM GANESH TRADING COMPANY. EV EN DURING REMAND PROCEEDINGS, THE ASSESSEE FAILED TO P RODUCE THE PARTIES AND MERELY RELIED UPON ITS SUBMISSIONS. AD DITIONS M/S INCOACH BUILDERS 4 WERE MADE ON ACCOUNT OF PURCHASES FROM M/S HARDIC M ETALS (RS.7,85,692/-) AND M/S ALSTON TRADING COMPANY PVT. LTD. (RS.1,29,872/-) AS THE ASSESSEE COULD NOT PROVE THE GENUINENESS OF THESE TRANSACTIONS. IT IS STRANGE TH AT WHEN THE ASSESSEE IS CLAIMING HEAVY TRANSACTION FROM THE CON CERNED PARTIES STILL COULD NOT PRODUCE/TRACE THEM, CONSEQU ENTLY, THE TRANSACTION BECOMES DOUBTFUL. THIS BENCH IS SATI SFIED THAT THE ASSESSEE HAS NOT DISCHARGED ITS ONUS IN PROVING THAT THE TRANSACTIONS WERE GENUINE; THEREFORE, DIRECT THE AS SESSEE TO PRODUCE THESE TWO PARTIES TO SUBSTANTIATE ITS CLAIM BEFORE THE ASSESSING OFFICER. IF THE PARTIES ARE PRODUCED, N O GRIEVANCE WILL BE CAUSED TO EITHER SIDE AND TRUTH WILL PREVAI L. THE ASSESSING OFFICER MAY EXAMINE THESE PARTIES, IF PRO DUCED, AND SATISFY HIMSELF ABOUT THE GENUINENESS OF THE TRANSA CTIONS. THUS, THE APPEAL OF THE REVENUE IS ALLOWED FOR STAT ISTICAL PURPOSES. THE STAND OF THE LD. COMMISSIONER OF INC OME TAX (APPEALS) IS REVERSED. FINALLY, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 16/03/2015. ' ' $%& ( )* 16 /0 3 /2015 % ' / 0 SD/ - (D. KARUNAKARA RAO) SD/ - (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER ! ) MUMBAI; ( ) DATED : 16/03/2015 M/S INCOACH BUILDERS 5 F{X~{T? P.S/. .. %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. 23 45 / THE APPELLANT 2. 6745 / THE RESPONDENT. 3. ! 8 ( 23 ) / THE CIT, MUMBAI. 4. ! 8 / CIT(A)- , MUMBAI 5. :; / 6 < , 23# 2< , ! ) / DR, ITAT, MUMBAI 6. / = / GUARD FILE. / BY ORDER, 7 :3 6 //TRUE COPY// / (DY./ASSTT. REGISTRAR) , ! ) / ITAT, MUMBAI