Firoz Ahmed Moh. Motin Choudhary, Pune V. Income-tax Officer, Ward - 9 (1), Pune

ITA 532/PUN/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 2836 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 05-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K VERMA
• Keywords: Bogus purchase; Unexplained expenditure; Principle of natural justice; Condonation of delay
• Section: 143(3); 143(1); 148; 6

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER . / ITA NO.531 & 532/PUN/2019 / ASSESSMENT YEARS : 2009-10 & 2011-12 FIROZ AHMED MOH. MOTIN CHOUDHARY, STAR LUBRICANTS, NR. PARSHURAM ROLLING MILL, VIDYA NAGAR, CHINCHWAD, PUNE 411019. PAN : AFTPC7046Q. . / APPELLANT V/S THE INCOME TAX OFFICER , WARD 9(1), AKURDI, PUNE. . / RESPONDENT ASSESSEE BY : SHRI DINESH RAMESH GULABANI. REVENUE BY : SHRI M.K. VERMA. / ORDER PER ANIL CHATURVEDI, AM : 1. THESE TWO APPEALS FILED BY THE ASSESSEE ARE EMANATING OUT OF SEPARATE ORDERS OF COMMISSIONER OF INCOME TAX (APPEALS) 8, PUNE DATED 04.01.2019 FOR A.YS. 2009-10 & 2011-12 RESPECTIVELY. 2. BEFORE ME, AT THE OUTSET, BOTH THE PARTIES SUBMITTED T HAT THOUGH THE APPEALS FILED BY THE ASSESSEE ARE FOR TWO DIFFERENT ASS ESSMENT YEARS BUT THE FACTS AND ISSUES INVOLVED IN BOTH THE APPEALS ARE IDENTICAL EXCEPT FOR THE ASSESSMENT YEAR AND THE AMOUNTS INVOLVED AND THEREFORE THE SUBMISSIONS MADE BY THEM WHILE ARGUING ONE APPEAL WOULD BE EQUALLY APPLICABLE TO THE OTHER APPEAL ALSO AND THUS BOTH THE A PPEALS CAN BE / DATE OF HEARING : 04.06.2019 / DATE OF PRONOUNCEMENT: 07.06.2019 2 ITA NOS.531 & 532/PUN/2019 HEARD TOGETHER. IN VIEW OF THE AFORESAID SUBMISSIONS OF BO TH THE PARTIES, I, FOR THE SAKE OF CONVENIENCE, PROCEED TO DISPOSE OF BOTH THE APPEALS BY A CONSOLIDATED ORDER BUT HOWEVER, PROCEED WITH NARRATING T HE FACTS IN ITA NO.531/PUN/2019 FOR ASSESSMENT YEAR 2009-10. 3. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RE CORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF TRAD ING OF OIL UNDER THE NAME AND STYLE OF STAR LUBRICANTS. ASSESSE E FILED HIS ORIGINAL RETURN OF INCOME FOR A.Y. 2009-10 ON 30.10.2009 DECLARING TO TAL INCOME AT RS.3,00,200/-. THE RETURN OF INCOME WAS INITIALLY PROCESS ED U/S 143(1) OF THE ACT. THEREAFTER, ON THE BASIS OF THE INFORMATION RECE IVED FROM SALES TAX DEPARTMENT, IT WAS FOUND THAT ASSESSEE HAD INDULGED INTO HAWALA TRANSACTIONS OF PURCHASES. AO THEREAFTER ISSUED NOTICE U /S 148 OF THE ACT AND IT IS STATED TO HAVE BEEN SERVED ON THE ASSESSEE. CONSEQUENTLY, THE CASE WAS TAKEN FOR SCRUTINY AND THEREAFTER THE ASSESSM ENT WAS FRAMED U/S 143(3) R.W.S. 147 OF THE ACT VIDE ORDER DT.12.03.2015 AND THE TOTAL INCOME WAS DETERMINED AT RS.11,43,960/-. AGGRIEVED BY T HE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO VIDE ORD ER DT.04.01.2019 (IN APPEAL NO.PN/CIT(A)-8/ITO-WD 9(1)/640/2017- 18) DISMISSED THE APPEAL OF ASSESSEE. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APPEAL AND HAS RAISED THE FOLLOWING GROUNDS : 1. THE LD. CIT(A) ERRED IN DISMISSING THE APPEAL F ILED BY THE APPELLANT AS INVALID AND NON-MAINTAINABLE BEING BARRED BY THE PE RIOD OF LIMITATION BY REJECTING APPELLANTS AFFIDAVIT TOWARDS CONDONATION OF DELAY FOR 331 DAYS EXPLAINING SUFFICIENT CAUSE OF DELAY. 2. THE LD. CIT(A) FAILED TO APPRECIATE THAT IN APPE AL FOR AY 2010-2011 THE DELAY ON SAME GROUNDS WAS CONDONED BY THE THEN LD. CIT(A) & THE CASE OF AY 2009-2010 IS A COVERED CASE WHEREIN ITAT HAS GIV EN DECISIONS FOR AY 2010-2011 ON FURTHER APPEAL. 3 ITA NOS.531 & 532/PUN/2019 3. THE LD. AO HAS WRONGLY DRAWN ERRONEOUS INFERENCE BY MAKING TOTAL ADDITIONS OF RS. 8,43,759/- TOWARDS BOGUS PURCHASES FROM MIHIR MARKETING & SHIFA ENTERPRISES WITHOUT ANY INVESTIGATION & PUR ELY ON THE INFORMATION OF SALES TAX DEPARTMENT WHICH IS NOT JUSTIFIED AS P ER PROVISIONS OF LAW. 4. SIMILAR GROUNDS HAVE BEEN RAISED IN I.T.A. NO.532/PUN/20 19 FOR A.Y. 2011-12. 5. ON THE BASIS OF INFORMATION RECEIVED FROM SALES TAX DE PARTMENT, IT WAS NOTICED THAT ASSESSEE HAD MADE PURCHASES AGGREGA TING TO RS.8,43,759/- IN A.Y 2009-10 FROM TWO PARTIES I.E., MIHIR MARK ETING AND SHIFA ENTERPRISES. AO WAS OF THE VIEW THAT THE PURCHASES MADE BY THE ASSESSEE FROM THE AFORESAID PARTIES WERE NOT GENUINE AND THE PURCHASES HAVE BEEN MADE BY THE ASSESSEE TO INFLATE THE EXPENSES TO REDUCE THE TOTAL INCOME OF THE ASSESSEE. ASSESSEE WAS ASKED TO PROVE TH E GENUINENESS OF PURCHASES BY PRODUCING THE COPIES OF TRANSPORTATION BILLS/ LORRY RECEIPT, DELIVERY CHALLANS, EXTRACT OF LEDGER ACCOUNT ETC. TO PROVE THE GENUINENESS OF TRANSACTIONS, ASSESSEE FURNISHED COPIES OF PURCHASE BILLS , LEDGER EXTRACT OF THE CONCERNED PARTIES IN ITS BOOKS OF ACCOUNT. ASSES SEE HOWEVER DID NOT FURNISH THE CONFIRMATION OF THE PARTIES CONCERNED, P ROOF OF PAYMENT MADE AGAINST ALLEGED PURCHASES OF RS.8,43,759/- ETC. AO TH EREFORE CONCLUDED THE PURCHASES TO BE BOGUS PURCHASES AND AD DED IT AS UNEXPLAINED EXPENDITURE U/S 69C. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO DISMISSED THE APP EAL OF THE ASSESSEE. 6. BEFORE ME, AT THE OUTSET, LD.A.R. SUBMITTED THAT THERE WAS A DELAY OF 331 DAYS IN FILING THE APPEAL BEFORE LD.CIT(A). ASSESSEE FILE D THE AFFIDAVIT EXPLAINING THE REASONS FOR DELAY IN FILING THE APPEAL AN D PRAYED FOR CONDONATION OF DELAY WHICH WAS REFUSED BY THE LD.CIT(A ). HE FURTHER 4 ITA NOS.531 & 532/PUN/2019 SUBMITTED THAT LD.CIT(A) WITHOUT DECIDING ON MERITS, DISMISSE D THE APPEAL OF ASSESSEE. BEFORE ME LD.A.R. SUBMITTED THAT T HERE WAS NO MALAFIDE INTENTION IN DELAYED FILING THE APPEAL BEFORE LD.CIT(A) AND PRAYED THAT IN THE INTEREST OF JUSTICE, THE DELAY IN FILING THE APPEAL BEFORE LD.CIT(A) BE DIRECTED TO BE CONDONED AND IF GIVEN AN OPPOR TUNITY, ASSESSEE WILL FURNISH ALL THE DETAILS TO PROVE HIS CASE. HE THEREFORE PRAYED THAT SUITABLE DIRECTIONS MAY BE ISSUED TO LD.CIT(A ) TO DECIDE THE ISSUE ON MERITS. HE FURTHER GAVE AN UNDERTAKING THAT IF GIV EN A CHANCE, ASSESSEE WILL APPEAR BEFORE LOWER AUTHORITIES AND FURNISH ALL THE REQUIRED DETAILS TO SUBSTANTIATE HIS CASE. HE THEREFORE SUBMITTED T HAT ASSESSEE BE GRANTED ONE MORE OPPORTUNITY TO PLEAD ITS CASE. LD.D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF AO AND LD.CIT(A) AND OBJECT ED TO LD.A.R.S PRAYER FOR 2 ND INNINGS. 7. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE M ATERIAL ON RECORD. I FIND THAT THERE WAS DELAY IN FILING THE APPEAL BEFO RE LD.CIT(A) AND THE DELAY WAS NOT CONDONED BY LD.CIT(A) AND FURTHER LD.CIT(A) HAS PASSED DISMISSAL ORDER BY REJECTING THE AFFIDAVIT OF ASSESSE E FILED FOR CONDONATION OF THE DELAY WITHOUT DECIDING THE ISSUE ON MERITS. BEFORE ME, LD.A.R. HAS EXPLAINED THE REASONS FOR DELAY IN FILING THE APPEAL. CONSIDERING THE SUBMISSIONS OF LD.A.R. AND I N VIEW OF THE WELL SETTLED PRINCIPLE OF NATURAL JUSTICE THAT SUFFICIENT OPPORTUNITY OF HEA RING SHOULD BE AFFORDED TO THE PARTIES AND NO PARTY SHOULD BE CONDE MNED UNHEARD, I AM OF THE VIEW THAT THE DELAY IN FILING THE APPEAL BEFORE LD.C IT(A) NEEDS TO BE CONDONED. I ACCORDINGLY, CONDONE THE DELAY IN FILING THE APPEAL BEFORE LD.CIT(A). FURTHER, SINCE THE LD.CIT(A) HAS NOT DECIDED TH E APPEAL ON MERITS, I AM OF THE VIEW THAT ONE MORE OPPORTUNITY BE GR ANTED TO THE 5 ITA NOS.531 & 532/PUN/2019 ASSESSEE TO PRESENT HIS CASE. I THEREFORE RESTORE THE MATTER BACK TO THE FILE OF LD.CIT(A) TO DECIDE THE ISSUE ON MERITS AFRESH IN ACCORDA NCE WITH LAW. NEEDLESS TO STATE THAT LD.CIT(A) SHALL GRANT ADEQUATE OP PORTUNITY OF HEARING TO BOTH THE PARTIES. ASSESSEE IS ALSO DIRECTED TO PROMPTLY FURNISH ALL THE DETAILS CALLED FOR BY THE LOWER AUTHORITIES. IN VIEW OF MY DECISION TO RESTORE THE ISSUE TO LD.CIT(A), I AM NOT ADJUDICATING ON M ERITS THE GROUNDS OF THE APPEAL RAISED BY THE ASSESSEE. THUS, THE GROUNDS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, THE APPEAL OF ASSESSEE IN ITA NO.531 /PUN/2017 FOR A.Y. 2009-10 IS ALLOWED FOR STATISTICAL PURPOSE S. 9. NOW I TAKE UP ASSESSEES APPEAL IN ITA NO.532/PUN/20 17 FOR A.Y 2011-12. 10. AS FAR AS THE GROUNDS RAISED IN APPEAL IN ITA NO.532 /PUN/2017 FOR A.Y. 2011-12 IS CONCERNED, IN VIEW OF THE SUBMISSION OF BOT H THE PARTIES THAT THE FACTS OF THE CASE IN THE YEAR BEING IDENTICAL TO THE FACTS AND ISSUE OF THE CASE IN ITA NO.531/PUN/2017 FOR A.Y. 2009-10, I TH EREFORE FOR THE REASONS STATED HEREIN WHILE DISPOSING OF THE APPEAL IN ITA NO.531/PUN/2017 FOR A.Y. 2009-10, AND FOR SIMILAR REASONS R ESTORE THE ISSUE TO THE FILE OF LD.CIT(A) TO DECIDE THE ISSUE ON MERITS. THUS, THE GROUNDS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. THUS, THE GROUNDS OF THE ASSESSEE ARE ALLOWED. 11. IN THE RESULT, THE APPEAL OF ASSESSEE IN ITA NO.532 /PUN/2017 FOR A.Y. 2011-12 IS ALLOWED FOR STATISTICAL PURPOSE S. 6 ITA NOS.531 & 532/PUN/2019 12. TO SUM UP, BOTH THE APPEALS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 7 TH DAY OF JUNE, 2019. SD/- SD/-- ( ANIL CHATURVEDI ) ' / ACCOUNTANT MEMBER PUNE; DATED : 7 TH JUNE, 2019. YAMINI #$%&'(' % / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-8, PUNE. PR. CIT-4, PUNE. '#$ %%&',) &', *+ / DR, ITAT, SMC PUNE; $-.// GUARD FILE. / BY ORDER // TRUE COPY // 012%3&4 / SR. PRIVATE SECRETARY ) &' , / ITAT, PUNE.