ITO 27(1)(4), MUMBAI V. SHRI. DILIP G KACHHARA, MUMBAI

ITA 494/MUM/2020

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 9394 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 20-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase; Accommodation entries
• Section: 147; 148; 144; 142(1)

Judgement Text

आयकर अपीलीय अिधकरण मुंबई पीठ “एस एम सी” , मुंबई Įी ǒवकास अवèथी, Ûयाियक सदèय IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “SMC”, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER आअसं. 494/मुं/2020 (िन.व.2009-10) ITA NO.494/MUM/2020 (A.Y.2009-10) ITO-27(1)(4), Room No. 409, 4 th Floor, Tower No.6, Vashi Railway Station Complex, Vashi, Navi Mumbai-400703. ...... अपीलाथȸ /Appellant बनाम Vs. Dilip G. Kachhara, Bhairav Enterprises, 1, Kanta Smruti, Near Hotel Airways, LBS Marg, Ghatkopar (W), Mumbai-400086. PAN: AABPK2046H ..... Ĥितवादȣ/Respondent अपीलाथȸ Ʈारा/ Appellant by : Sh. Sanjay J. Sethi Ĥितवादȣ Ʈारा/Respondent by : None सुनवाई कȧ ितिथ/ Date of hearing : 01/07/2021 घोषणा कȧ ितिथ/ Date of pronouncement : 24/09/2021 आदेश/ ORDER PER VIKAS AWASTHY, J.M: This appeal by the Revenue is directed against the order of Commissioner of Income Tax (Appeals)-24, Mumbai [hereinafter referred to as ‘the CIT(A)’] ' dated 23.10.2019 for the Assessment Year (AY) 2009-10. 2. The brief facts of the case as emanating from records are: The assessee is engaged in trading of building material. On the basis of information received 2 आअसं. 494/मुं/2020 (िन.व.2009-10) ITA No. 494/Mum/2020 (A.Y. 2009-10) from Investigation wing of the Department, the assessment for AY 2009-10 in the case of assessee was re-opened. As per the information received, the assessee had obtained accommodation entries amounting to Rs. 2,26,019/- from M/s Mahadeshpura Enterprises, a hawala operator, declared by the Sales Tax Department, Government of Maharashtra. The Assessing Officer (AO) had issued notice under section 148 and thereafter notice under section 142(1) of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] to the assessee. The assessee did not respond to the said notices, hence, the AO completed the assessment under section 144 of the Act. During assessment proceeding, the assessee failed to discharge its onus in proving genuineness of the dealer and the purchases made from the said dealer. The AO estimated GP @ 25% on bogus purchases and made addition of Rs. 80,700/-. Against the assessment order dated 19.03.2015 passed under section 143(3) read with section 147 of the Act. The assessee filed appeal before the CIT(A). The CIT(A) after examining the facts granted part relief to the assessee by estimating GP @ 10% on bogus purchases. Now, the Revenue is in appeal against the order of CIT(A). 3. Sh. Sanjay J. Sethi representing the Department vehemently supported the assessment order and prayed for reversing the findings of First Appellate Authority. The ld. Departmental Representative (DR) submitted that the CIT(A) has failed to appreciate the fact that the assessee has failed to substantiate genuineness of the dealers and the purchases made from the said dealer. The AO in a fair and reasonable manner has estimated suppressed profit margin on bogus purchases at the rate of 25%. The CIT(A) has reduced it to 10%. 3 आअसं. 494/मुं/2020 (िन.व.2009-10) ITA No. 494/Mum/2020 (A.Y. 2009-10) 4. Submissions made by ld. DR heard, orders of the authorities below examined. Undisputedly, the assessee during assessment proceedings failed to discharge its onus in proving genuineness of the dealer and the purchases made from the said dealer. The AO, disallowed 25% of the unproved purchases. In First Appellate Proceedings, the CIT(A) restricted the disallowance to 10%. In my considered view, estimation of suppressed profit margin on bogus purchases by the AO was on higher side. I find no infirmity in the order of CIT(A) in estimating suppressed profit margin to 10%. Accordingly, the impugned order is upheld and appeal by the Revenue is dismissed, sans merit. Order pronounced in the open court on Friday, the 24 th day of September, 2021. Sd/- (VIKAS AWASTHY) Ûयाियक सदèय / JUDICIAL MEMBER मुंबई/Mumbai, Ǒदनांक/Dated: 24/09/2021 SK, PS Ĥितिलǒप अĒेǒषतCopy of the Order forwarded to : 1. अपीलाथȸ/The Appellant , 2. Ĥितवादȣ/ The Respondent. 3. आयकर आयुƠ(अ)/ The CIT(A)- 4. आयकर आयुƠ CIT 5. ǒवभागीय Ĥितिनिध, आय.अपी.अिध., मुबंई/DR, ITAT, Mumbai 6. गाड[ फाइल/Guard file. BY ORDER, //True Copy// (Dy./Asstt. Registrar) ITAT, Mumbai