Income Tax Officer-25(1)(5), Mumbai V. M/s. Tushar Engineering Industries, Mumbai

ITA 5032/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 9210 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2009-2010
• Appeal Filed On: 01-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR MENON
• Keywords: Bogus purchase; Set aside
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUM BAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI RAM LAL NEGI, JM ITA NO.5032/MUM/2019 (ASSESSMENT YEAR: 2009-10) INCOME TAX OFFICER-25(1)(5) ROOM NO. 229, 2 ND FLOOR, KAUTILYA BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI-400 051 VS. M/S. TUSHAR ENGINEERING INDUSTRIES 9, APURVA IND. ESTATE, MAKVANA ROAD, ANDHERI (E), MUMBAI-400 059 PAN/GIR NO. AABFT 0541 N ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : SHRI VIJAY KUMAR MENON RESPONDENT BY : NONE DATE OF HEARING : 06.01.2021 DATE OF PRONOUNCEMENT : 06.01.2021 O R D E R PER SHAMIM YAHYA, A. M.: THIS IS AN APPEAL BY THE REVENUE AGAINST THE ORDER OF LEARNED CIT(A)-37, MUMBAI DATED 29.05.2019, WHEREIN PENALTY LEVIED U/S. 271(1 )(C) HAS BEEN DELETED FOR THE ASSESSMENT YEAR 2009-10 FOR AN AMOUNT OF RS.27,090/ -. 2. BRIEF FACTS OF THE CASE LEADING TO THE LEVY OF P ENALTY ARE THAT THE ASSESSING OFFICER IN THIS CASE MADE DISALLOWANCE OF 100% ON ACCOUNT O F BOGUS PURCHASE OF RS.7,01,341/-. THE ASSESSEE HAS SUPPLIED THE PURCHASE VOUCHERS AND THE PAYMENT WHERE SHOWN TO HAVE BEEN MADE BY BANKING CHANNEL. HOWEVER, DRAWING ADVE RSE INFERENCE FOR THE NON PRODUCTION OF THE SUPPLIERS, THE ASSESSING OFFICER DISALLOWED 100% OF THE BOGUS PURCHASES. HOWEVER, THE ASSESSING OFFICER DID NOT D OUBT THE SALES. THE LEARNED CIT-A CONFIRMED THE ADDITION. HOWEVER, ITAT RESTRICTED TH E SAME TO 12.5%. PENALTY UNDER SECTION 271(1)(C) WAS ALSO LEVIED FOR AN AMOUNT OF RS.27,090/-. 3. AGAINST THIS ORDER, THE REVENUE IS IN APPEAL BEF ORE US. 4. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. AS CLEAR FROM THE FACTS RECORDED ABOVE, THE DISALLOWANCE HAS BEEN MADE ON A N ESTIMATED BASIS ON ACCOUNT OF THE 2 ITA NO. 5032/MUM/2019 ITO VS. M/S. TUSHAR ENGINEERING INDUSTRIES NON-PRODUCTION OF SUPPLIERS BEFORE THE ASSESSING OF FICER. THE PURCHASE VOUCHERS WERE DULY PRODUCED AND THE PAYMENTS WERE THROUGH BANKING CHANNEL. THE SALES ARE NOT DOUBTED. IN THESE BACKGROUNDS, IN OUR CONSIDERED OP INION, THE ASSESSEE CANNOT BE VISITED WITH THE RIGOURS OF PENALTY U/S. 271(1)(C). AS A MA TTER OF FACT, ON MANY OCCASIONS, ON SIMILAR CIRCUMSTANCES IN QUANTUM PROCEEDINGS THE DI SALLOWANCE ITSELF HAS BEEN DELETED. IN OUR CONSIDERED OPINION, ON THE FACTS AND CIRCUMSTAN CES OF THE CASE, THE ASSESSEE CANNOT BE SAID TO HAVE BEEN GUILTY OF CONCEALMENT OR FURNISHI NG OF INACCURATE PARTICULARS OF INCOME. IN THIS REGARD, WE DRAW SUPPORT FROM THE DECISION O F A LARGER BENCH OF THE HONOURABLE SUPREME COURT IN THE CASE OF THE M/S HINDUSTAN STEEL LTD. VS STATE OF ORISSA (1972) 83 ITR 26(SC), WHEREIN IT WAS HELD THAT THE AUTHORI TY MAY NOT LEVY THE PENALTY IF THE CONDUCT OF THE ASSESSEE IS NOT FOUND TO BE CONTUMAC IOUS. 5. IN THE BACKGROUND OF AFORESAID DISCUSSION AND PR ECEDENT, WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DELETE THE LEVY OF PENALTY. 6. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . ORDER PRONOUNCED UNDER RULE 34(4) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1962, BY PLACING THE DETAILS ON THE NOTICE BOARD ON 06.01.20 21 SD/- SD/- (RAM LAL NEGI) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED : 06.01.2021 ROSHANI , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI