ITO 19 (3)(1), Mumbai V. SHRI. RAJESH M CHAUHAN, Mumbai

ITA 4968/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 3694 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 30-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Section: 133(6); 143(1); 22; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 4968 / MUM . /201 9 ( ASSESSMENT YEAR : 20 11 12 ) INCOME TAX OFFICER WARD 19(3)(1), MUMBAI . APPELLANT V/S SHRI RAJESH M. CHAUHAN 403, DHARAM PALACE NATIONAL PARK SHANTIVAN BORIVALI (E), MUMBAI 400 066 PAN AAEPC3596K . RESPONDENT REVENUE BY : MS. SMITA VERMA ASSESSEE BY : NONE DATE OF HEARING 03.02.2021 DATE OF ORDER 24.02.2021 O R D E R PER SAKTIJIT DEY. J.M. THE CAPTIONED APPEAL HA S BEEN FILED BY THE REVENUE AGAINST ORDER DATED 22 ND MAY 2019, PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 6 , MUMBAI, FOR THE ASSESSMENT YEAR 20 1 1 1 2 . 2. WHEN THE APPEAL WAS CALLED FOR HEARING, NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE. CONSIDERING THE NATURE OF D ISPUTE, I PROCEED TO DISPOSE OF THE APPEAL EX PARTE QUA THE ASSESSEE AFTER HEARING THE 2 SHRI RAJESH M. CHAUHAN LEARNED DEPARTMENTAL REPRESENTATIVE AND ON THE BASIS OF MATERIALS AVAILABLE ON RECORD. 3. THE DISPUTE IN THE APPEAL IS CONFINED TO PARTIAL RELIEF GRANTED BY LEARNED COMMISSIONER (APPEALS) IN THE MATTER OF ADDITION MADE ON ACCOUNT OF NON GENUINE PURCHASES. 4. BRIEF FACTS ARE , THE ASSESSEE IS AN INDIVIDUAL AND IS STATED TO BE A LABOUR CONTRACTOR FOR ENGINEERING WORK. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HIS RETURN OF INCOME ON 24 TH SEPTEMBER 2011 DECLARING TOTAL INCOME OF ` 2,84,884. THE RETURN OF INCOME FILED BY THE ASSESSEE WAS INITIALLY PROCESSED UNDER SECTION 143(1) OF THE ACT. SUBSEQUENTLY , THE ASSESSING OFFICER RECEIVED INFORMATION FROM THE SALES TAX DEPARTMENT THROUGH INVESTIGATION WING THAT THE ASSESSEE IS A BENEFICI ARY OF ACCOMMODATION BILLS PROVIDED FOR PURCHASES WORTH ` 37,16,912. ON THE BASIS OF SUCH INFORMATION, THE ASSESSING OFFICER RE OPENED THE ASSESSMENT UNDER SECTION 147 OF THE ACT. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER CALLED UPON T HE ASSESSEE TO PROVE THE GENUINENESS OF PURCHASES. IN RESPONSE, THOUGH , THE ASSESSEE FURNISHED SOME DOCUMENTARY EVIDENCES, HOWEVER, THE ASSESSING OFFICER WAS NOT SATISFIED WITH THEM. FURTHER, THE NOTICES ISSUED BY THE ASSESSING OFFICER UNDER SECTION 133(6) OF THE ACT SEEKING INFORMATION FROM THE SELLING DEALERS RETURNED BACK UN SERVED. 3 SHRI RAJESH M. CHAUHAN THUS, THE ASSESSING OFFICER CONCLUDED THAT THE PURCHASES CLAIMED TO HAVE BEEN MADE BY THE ASSESSEE ARE NON GENUINE. HAVING HELD SO, HE DISALLOWED AN AMOUNT OF ` 9,29,228, BEI NG 25% OF THE ALLEGED NON GENUINE PURCHASES AND ADDED BACK TO THE INCOME OF THE ASSESSEE. 5. THE ASSESSEE CONTESTED THE AFORESAID DISALLOWANCE BEFORE THE LEA RNED COMMISSIONER (APPEALS). TAKING NOTE THAT IN ASSESSEES OWN CASE IN ASSESSMENT YEAR 2009 10, THE FIRST APPELLATE AUTHORITY HAS RESTRICTED THE DISALLOWANCE TO 12.5% OF NON GENUINE PURCHASES , LEARNED COMMISSIONER (APPEALS) FOLLOWED THE SAME AND RESTRICTED THE DISALLOWANCE TO 12.5% OF THE NON GENUINE PURCHASES IN THE IMPUGNED ASSESSMENT YEAR. 6. I HAVE CON SIDERED THE SUBMISSIONS OF THE LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL ON RECORD. THOUGH, IT MAY BE A FACT THAT THE ASSESSEE COULD NOT FURNISH CONCLUSIVE EVIDENCE TO PROVE THE SOURCE OF THE DISPUTED PURCHASES, HOWEVER, THE FACT THAT TH E ASSESSEE HAD PURCHASED THE GOODS FROM SOME OTHER SOURCES HAS NOT BEEN DISPUTED BY THE ASSESSING OFFICER. THEREFORE, INSTEAD OF DISALLOWING THE ENTIRE PURCHASES, HE HAS DISALLOWED 25% OF THE PURCHASES ALLEGED TO BE NON GENUINE. L EARNED COMMISSIONER (APPEA LS) HAS RESTRICTED SUCH DISALLOWANCE TO 12.5% OF THE NON GENUINE PURCHASES. THUS, ULTIMATELY, THE DISPUTE IS CONFINED TO THE 4 SHRI RAJESH M. CHAUHAN RATE AT WHICH THE DISALLOWANCE IS TO BE MADE. AFTER TAKING NOTE OF ALL THE RELEVANT FACTORS AND THE LEGAL AUTHORITIES ON THE ISSUE, I AGREE WITH THE DECISION OF LEARNED COMMISSIONER (APPEALS) IN RESTRICTING THE DISALLOWANCE TO 12.5% OF THE ALLEGED NON GENUINE PURCHASES. ACCORDINGLY, I UPHOLD THE ORDER OF LEARNED COMMISSIONER (APPEALS) BY DISMISSING THE GROUNDS RAISED. 7. IN THE RESULT, APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24.02.2021 SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMB AI, DATED: 24.02.2021 COPY OF THE ORDER FORWARDED TO : (1) THE ASSESSEE; (2) THE REVENUE; (3) THE CIT(A); (4) THE CIT, MUMBAI CITY CONCERNED; (5) THE DR, ITAT, MUMBAI; (6) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY ASSISTANT REGISTRAR ITAT, MUMBAI