ITO-20(3)(2), MUMBAI V. MR. R.K.SINGH & SONS, MUMBAI

ITA 5161/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 9404 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-03-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 07-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RADHA HALBE
• Keywords: Bogus purchase; Tax effect

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , ! ,'# '$ BEFORE VIKAS AWASTHY, JUDICIAL MEMBER & SHRI N.K.PRADHAN, ACCOUNTANT MEMBER . 5161/ / 2019 (. . 2009-10 ) ITA NO.5161/MUM/2019(A.Y.2009-10) INCOME TAX OFFICER -20(3)(2), PIRAMAL CHAMBERS, LALBAUG, MUMBAI 400 012 ...... ) / APPELLANT VS. M/S. R.K.SINGH & SONS, PLOT NO.12, SONAPUR, QUAY STREET, DARUKHANA, MUMBAI 400 010 PAN: AAEFR8413L ..... !*/ RESPONDENT ASSESSEE BY : MS.RADHA HALBE REVENUE BY : SHRI SANJAY J. SETHI +* / DATE OF HEARING : 02/03/2021 ,-. +* / DATE OF PRONOUNCEMENT : 08/03/2021 '/ ORDER PER VIKAS AWASTHY, J.M: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-32, MUMBAI ( IN SHORT THE CIT (A)) DATED 27/05/2019 FOR THE ASSESSMENT YEAR 2009-10. 2. SHRI SANJAY J. SETHI, REPRESENTING THE DEPARTM ENT SUBMITTED THAT THE ASSESSEE IS A RESELLER OF SCRAP. DURING THE PERIOD RELEVANT TO ASSESSMENT YEAR UNDER APPEAL, THE ASSESSEE OBTAINED BOGUS PURCHASE BILLS AGGREGA TING TO RS.1,15,46,063/- FROM VARIOUS (SEVEN) HAWALA OPERATORS. THE ASSESSMENT O F THE ASSESSEE FOR ASSESSMENT 2 . 5161/ / 2019 (. . 2009-10 ) ITA NO.5161/MUM/2019(A.Y.2009-10) YEAR 2009-10 WAS REOPENED. IN REASSESSMENT PROCEED INGS THE ASSESSEE FAILED TO PROVE GENUINENESS OF THE PURCHASES AND THE DEALERS FROM WHOM BOGUS BILLS WERE PROCURED. THE ASSESSING OFFICER MADE ADDITION OF R S.14,43,258/- BY ESTIMATING G.P @ 12.5% ON BOGUS PURCHASES. THE ASSESSEE CARRIED T HE ISSUE IN APPEAL BEFORE CIT(A). THE FIRST APPELLATE AUTHORITY GRANTED RELIEF TO T HE ASSESSEE BY ESTIMATING G.P @ 5% AND THUS, RESTRICTED THE ADDITION TO RS.5,77,303/-. AGAINST THE FINDINGS OF CIT(A) THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. THE L D. DEPARTMENTAL REPRESENTATIVE CONTENDED THAT THOUGH THE TAX EFFECT INVOLVED IN TH E APPEAL IS LESS THAN THE MONETARY LIMIT SPECIFIED VIDE CBDT CIRCULAR NO. 17/20 19, DATED 08-08-2019 BUT THE CASE OF ASSESSEE FALLS UNDER EXCEPTION SPECIFIED IN PARA 10(E) OF CIRCULAR NO. 03 OF 2018 DATED 11/07/2018 AND AMENDED ON 20/08/2018 . 3. MS.RADHA HALBE, APPEARING ON BEHALF OF THE ASSE SSEE VEHEMENTLY DEFENDED THE IMPUGNED ORDER AND PRAYED FOR DISMISSING THE AP PEAL OF REVENUE. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMI TTED THAT THE SALES DECLARED BY ASSESSEE HAS BEEN ACCEPTED BY THE REVENUE. THE ASS ESSEE HAD DECLARED G.P OF 4.63% IN FINANCIAL YEAR 2008-09 I.E. THE PERIOD REL EVANT TO ASSESSMENT YEAR 2009-10. THE SAME HAS NOT BEEN DISPUTED BY THE REVENUE. THE G.P ESTIMATED BY THE ASSESSING OFFICER AT 12.5% WAS VERY MUCH ON THE HIG HER SIDE. THE CIT(A) AFTER CONSIDERING THE G.P RATE DECLARED BY THE ASSESSEE , RESTRICTED THE ADDITION TO 5% AND THE SAME HAS BEEN ACCEPTED BY THE ASSESSEE. 4. WE HAVE HEARD THE SUBMISSIONS MADE BY RIVAL SIDE S AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. UNDISPUTEDLY, THE ASS ESSEE HAS FAILED TO SUBSTANTIATE THE PURCHASES MADE FROM SUSPICIOUS DEALERS. THE S ALES TURNOVER DECLARED BY THE ASSESSEE WAS ACCEPTED BY THE REVENUE. THE ASSESSIN G OFFICER ESTIMATED G.P ON ALLEGED BOGUS PURCHASES AT 12.5%. IN FIRST APPELLA TE PROCEEDINGS, THE CIT(A) RESTRICTED THE ADDITION TO 5%. THE ASSESSEE HAS DE CLARED G.P OF 4.63% FOR THE PERIOD RELEVANT TO THE ASSESSMENT YEAR IN APPEAL. WE FIND THE ORDER OF CIT(A) WELL REASONED 3 . 5161/ / 2019 (. . 2009-10 ) ITA NO.5161/MUM/2019(A.Y.2009-10) AND BALANCED, HENCE, WE CONCUR WITH THE SAME. THE APPEAL OF THE REVENUE IS WITHOUT ANY MERIT, HENCE, THE SAME IS DISMISSED. 5. IN THE RESULT, APPEAL BY THE REVENUE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON MONDAY, THE 8 TH DAY OF MARCH, 2021. SD/- SD/- (N.K.PRADHAN) (VIKAS AWAST HY) '# / ACCOUNTANT MEMBER / JUDICIAL MEMBER / MUMBAI, 0/ DATED 08/03/2021 VM , SR. PS (O/S) !*12'.* COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT , 2. !* / THE RESPONDENT. 3. 3* ( )/ THE CIT(A)- 4. 3* CIT 5. 45!* , . . . , / DR, ITAT, MUMBAI 6. 56789 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI