SHRI. SANJEEVAN R MITTAL , Mumbai V. ITO 28 (3)(1), Mumbai

ITA 4836/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 4499 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-04-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 18-07-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SMITA VERM
• Keywords: Bogus purchase; Accommodation entries
• Section: 133(6); 139(1); 73; 22; 147

Judgement Text

1 I.T.A. NO.4836 TO 4838/MUM/2019 IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY (JUDICIAL MEMBER) AND SHRI MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) I.T.A. NO. 4836 /MUM/201 8 - A SSESSMENT Y EAR 2009 - 10 I.T.A. NO.4837/MUM/2018 - A SSESSMENT Y EAR 2010 - 11 I.T.A. NO.4838/MUM/2018 - A SSESSMENT Y EAR 20 11 - 1 2 SHRI SANJEEVAN R MITTAL 73 - A, KAVERI CO - OP SOCIETY SECTOR - 17, VASHI, NAVI MUMBAI - 400 706 PAN : AAIPA0734H VS THE INCOME - TAX OFFICER - 28(3)(2) MUMBAI APPELLANT RESPONDENT APPELLANT BY NONE RESPONDENT BY SMT. SMITA VERM, DR DATE OF HEARING 22 - 0 3 - 2021 DATE OF PRONOUNCEMENT 1 5 - 0 4 - 2021 O R D E R PER SAKTIJIT DEY (JM) : CAPTIONED APPEALS BY THE SAME ASSESSEE ARISE OUT OF THREE SEPARATE ORDERS DATED 15 - 02 - 2019 AND 28 - 02 - 2019 OF L EARNED COMMISSIONER OF INCOME - TAX (APPEALS) - 26, MUMBAI, FOR THE ASSESSMENT YEARS 2009 - 10, 2010 - 11 AND 2011 - 12. 2. WHEN THE APPEALS WERE CALLED FOR HEARING NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE DESPITE NOTICE. EVEN , THERE IS NO APPLICATION SEEKING ADJOURNMENT EITHER. IN VI EW OF THE AFORESAID, WE PROCEED TO DISPOSE OF THE APPEALS EX PARTE 2 I.T.A. NO.4836 TO 4838/MUM/2019 QUA THE ASSESSEE, AFTER HEARING THE L EARNED D EPARTMENTAL R EPRESENTATIVE AND ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 3. THE COMMON GROUND OF APPEAL IN ALL THESE APPEALS IS WITH REGARD TO DISALLOWANCE / ADDITION MADE ON ACCOUNT OF NON GENUINE PURCHASES. 4. BRIEFLY THE FACTS , MORE OR LESS COMMON IN ALL THESE APPEALS ARE, THE ASSESSEE, AN INDIVIDUAL , IS A TRADER IN MILD STEEL, IRON AND STEEL PRODUCTS. IN RESPECT OF ALL THE ASSESSMENT YEARS UNDER DISPUTE, THE ASSESSEE HAD ORIGINALLY FILED RETURNS OF INCOME UNDER SECTION 139(1) OF THE INCOME TAX ACT , 1961 . SUBSEQUENTLY, ON THE BASIS OF INFORMATION RECEIVED FROM THE S ALES - TAX DEPARTMENT THAT CERTAIN PURCHASES SHOWN TO HAVE BEEN MADE IN THE YEA RS UNDER CONSIDERATION ARE NON - GENUINE, AS THEY ARE IN THE NATURE OF ACCOMMODATION ENTRIES BY WAY OF BOGUS PURCHASE BILLS, THE ASSESSING OFFICER REOPENED THE ASSESSMENTS OF ALL THE THREE YEARS UNDER SECTION 147 OF THE ACT. IN COURSE OF THE RE - ASSESSMENT PR OCEEDINGS, THE ASSESSING OFFICER RAISED DOUBT REGARDING CERTAIN PURCHASES AND CALLED UPON THE ASSESSEE TO PROVE THE GENUINENESS OF THEM. THE DETAILS OF SUCH PURCHASES ARE AS UNDER: - ASSESSMENT YEAR AMOUNT 2009 - 10 RS. 88,18,716/ - 2010 - 11 RS.81,83,290/ - 2011 - 12 RS.52,59,550/ - 5. THOUGH , THE ASSESSEE FURNISHED SOME EVIDENCE IN SUPPORT OF HIS CLAIM, HOWEVER, THEY WERE NOT TO THE SATISFACTION OF THE ASSESSING OFFICER. FURTHER, THE ASSESSING OFFICERS EFFORT TO INDEPENDENTLY VERIFY THE DISPUTED PURCHASES DID NOT BEAR ANY RESULT AS THE NOTICES ISSUED U NDER SECTION 133(6) OF THE ACT TO THE CONCERNED SELLING DEALER RETURNED BACK UNSER VED. THUS, ULTIMATELY, THE ASSESSING 3 I.T.A. NO.4836 TO 4838/MUM/2019 OFFICER HELD THE DISPUTED PURCHASES AS NON GENUINE. HOWEVER, CONSIDERING THE FACT THAT ASSESSEE HAD EFFECTED THE CORRESPONDING SALES , ASSESSING OFFICER CONCLUDED THAT THE GOODS MUST HAVE BEEN PURCHASED FROM UNVERIFIED S OURCES / GREY MARKET LEADING TO SUPPRESSION OF PROFIT. HAVING HELD SO, HE DISALLOWED 12.5% OUT OF THE ALLEGED NON GENUINE PURCHASES IN EACH ASSESSMENT YEAR UNDER DISPUTE AND ADDED BACK TO THE INCOME OF THE ASSESSEE. THOUGH , THE ASSESSEE CONTESTED THE AFORE SAID DISALLOWANCE BEFORE L EARNED COMMISSIONER OF INCOME - TAX (APPEALS); HOWEVER, HE WAS UNSUCCESSFUL. 6 . WE HAVE CONSIDERED THE SUBMISSIONS OF L EARNED DEPARTMENTAL R EPRESENTATIVE AND PERUSED MATERIALS ON RECORD. IT IS EVIDENT, THE ASSESSING OFFICER HAS RECE IVED SPECIFIC INFORMATION FROM S ALES - TAX DEPARTMENT TO INDICATE THAT CERTAIN PURCHASE S MADE BY THE ASSESSEE IN THE ASSESSMENT YEARS UNDER DISPUTE ARE NON GENUINE , AS , THE CONCERNED SELLING DEALERS HAVE BEEN IDENTIFIED TO HAVE PROVIDED ACCOMMODATION BILLS. IN COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAD FAILED TO FURNISH CONCLUSIVE EVIDENCE TO PROVE THAT PURCHASES WERE MADE FROM THE DECLARED SOURCE. EVEN , THE NOTICES ISSUED BY THE ASSESSING OFFICER U NDER SECTION 133(6) OF THE ACT TO ASCERTAIN THE GENUI NENESS OF THE PURCHASES FAILED AS NO SUCH NOTICE COULD BE SERVED ON THE CONCERNED PART IES . THUS, THE SOURCE OF PURCHASES AT ALL STAGES REMAINED DOUBTFUL. THAT BEING THE CASE, THE CLAIM OF THE ASSESSEE THAT PURCHASES HAVE BEEN MADE FROM THE DECLARED SOURCE IS UNACCEPTABLE. FURTHER, CONSIDERING THE FACT THAT ASSESSEE FAILED TO PROVE THE SOURCE OF PURCHASES, IT CAN BE CONCLUDED THAT BY ADOPTING SUCH MEANS THE ASSESSEE HAS SUPPRESSED ITS TRUE PROFITS. IN THE AFORESAID SCENARIO, DISALLOWANCE AT 12.5% , BEING THE PROFIT ELEMENT EMBEDDED IN THE ALLEGED NON GENUINE PURCHASES, IN OUR CONSIDERED OPINION, IS FAIR AND REASONABLE; HENCE, DOES NOT CALL FOR ANY 4 I.T.A. NO.4836 TO 4838/MUM/2019 INTERFERENCE. A CCORDINGLY, WE UPHOLD THE DECISION OF L EARNED COMMISSIONER OF INCOME - TAX (APPEALS) IN ALL THE ASSE SSMENT YEARS UNDER DISPUTE BY DISMISSING THE GROUNDS. 6. IN THE RESULT, APPEALS ARE DISMISSED. ORDER PRONOUNCED ON 1 5 /0 4 /2021. S D / - S D / - ( MANOJ KUMAR AGGARWAL ) ( SAKTIJIT DEY ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DT : 1 5 /0 4 /2021 PAVANAN COPY TO : 1. APPELLANT 2. RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) 5. THE DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI