SHRI. CHIRAG RAJENDRA SHAH, Mumbai V. ITO 31 (1)(3), Mumbai

ITA 4876/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2092 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 22-07-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SMITHA VERMA
• Keywords: Bogus purchase; Accommodation entries
• Section: 133(6); 22

Judgement Text

, , ! IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC , MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 4876 / / 2019 (%. 2010-11 ) ITA NO.4876/MUM/2019(A.Y 2010-11 ) SHRI CHIRAG RAJENDRA SHAH, 801, LAXMI VILLA, ROAD NO.3, PLOT NO.281, JAWAHAR NAGAR, NEAR SUVIDHA HOSPITAL, GOREGAON (W), MUMBAI 400 104. PAN: AVQPS 7888H ...... ' / APPELLANT % VS. INCOME TAX OFFICER -31(1)(3), KAUTILYA BHAVAN, G BLOCK, BANDRA KURLA COMPLEX, MUMBAI 400 051 ..... ()/ RESPONDENT '*/ APPELLANT BY : SHRI VIMAL PUNMIYA ()*/ RESPONDENT BY : MS. SMITHA VERMA %+) / DATE OF HEARING : 05/04/2021 ,-. +) / DATE OF PRONOUNCEMENT : 22/06/2021 / ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX(APPEALS)-42, MUMBAI [IN SHORT 'THE CIT(A)] DATED 31/05/2019 FOR THE ASSESSMENT YEAR 2010-11. 2. SHRI VIMAL PUNMIYA APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING OF FERROUS AND NON-FERROUS METALS. THE ASSESSMENT FOR ASSESSMENT YEAR 2010-11 IN THE CASE OF ASSESSEE WAS REOPENED ON THE GROUND THAT THE ASSESSEE HAS OB TAINED ACCOMMODATION ENTRIES AGGREGATING TO RS.2,32,34,839/- FROM DEALER S DECLARED AS HAWALA 2 ITA NO.4876/MUM/2019(A.Y 2010-11) OPERATORS BY THE SALES TAX DEPARTMENT, GOVERNMENT O F MAHARASHTRA. THE ASSESSEE HAS FURNISHED VARIOUS DOCUMENTS BEFORE THE ASSESSING OFFICER TO SUBSTANTIATE GENUINENESS OF PURCHASES, HOWEVER, THE ASSESSING OFFICER MADE ADDITION OF RS.18,58,787/- BY ESTIMATING G.P ON ALL EGED BOGUS PURCHASES AT 8%. THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE THE CIT(A). THE CIT(A) WITHOUT APPRECIATING FACTS AND DOCUMENTS ON RECORD DISMISSE D THE APPEAL OF ASSESSEE. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SU BMITTED THAT THE ASSESSEE HAS DECLARED G.P OF 3.86% DURING THE RELEVANT PERIO D. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE POINTED THAT IN ASSE SSEES OWN CASE FOR ASSESSMENT YEAR 2009-10 THE TRIBUNAL IN ITA NO.792/ MUM/2017 DECIDED ON 07/12/2019 HAS DIRECTED TO RESTRICT THE ADDITION ON BOGUS PURCHASES AT THE SAME RATE AS THAT OF OTHER GENUINE PURCHASES. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT IN TH E ASSESSMENT YEAR UNDER APPEAL SIMILAR DIRECTIONS MAY BE GIVEN. 3. ON THE OTHER HAND, MS. SMITA VERMA REPRESENTIN G THE DEPARTMENT VEHEMENTLY DEFENDED THE IMPUGNED ORDER AND PRAYED FOR DISMISSING THE APPEAL OF ASSESSEE. THE LD.DEPARTMENTAL REPRESENTA TIVE SUBMITTED THAT DURING ASSESSMENT PROCEEDINGS THE ASSESSEE FAILED TO DISCH ARGE HIS ONUS IN PROVING GENUINENESS OF THE DEALERS AND PURCHASES MADE FROM THEM. THE NOTICES ISSUED TO THE DEALERS UNDER SECTION 133(6) OF THE I NCOME TAX ACT,1961 ( IN SHORT 'THE ACT') WERE RETURNED BACK UNSERVED. NO D OCUMENTARY EVIDENCE WAS FILED BY THE ASSESSEE TO PROVE TRAIL OF GOODS. 4. BOTH SIDES HEARD, ORDERS OF AUTHORITIES BELOW EX AMINED. UNDISPUTEDLY, ASSESSEE FAILED TO DISCHARGE HIS ONUS IN PROVING GE NUINENESS OF THE DEALERS AND THE PURCHASES MADE FROM SUSPICIOUS DEALERS. THE AS SESSEE IS A TRADER IN FERROUS AND NON-FERROUS METALS. GENERALLY, THE G.P IN TRADING OF FERROUS AND 3 ITA NO.4876/MUM/2019(A.Y 2010-11) NON-FERROUS METALS RANGES BETWEEN 5% TO 8%. THE AS SESSEE HAS DECLARED G.P AT 3.86%. TAKING NOTE OF ENTIRE FACTS, IN MY CONS IDERED VIEW ENDS OF JUSTICE WOULD BE MET IF THE ADDITION IS RESTRICTED TO 5% OF THE BOGUS PURCHASES. THE GROUND NO.1 RAISED IN THE APPEAL IS PARTLY ALLOWED IN THE TERMS AFORESAID. 5. NO SUBMISSIONS WERE MADE BY THE LD.AUTHORIZED RE PRESENTATIVE OF THE ASSESSEE ON OTHER GROUNDS RAISED IN GROUND NO. 2 T O 6 OF THE APPEAL, THEREFORE, THE SAME ARE DISMISSED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON TUESDAY, TH E 22 ND DAY OF JUNE, 2021 SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, 0%/ DATED 22/06/2021 VM , SR. PS (O/S) COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT , 2. () / THE RESPONDENT. 3. 1) ( )/ THE CIT(A)- 4. 1) CIT 5. 23()% , . . . , / DR, ITAT, MUMBAI 6. 34567 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI