INCOME TAX OFFICER 21(2)(2), MUMBAI V. MAHAVIR ENGINEERING COMPANY, MUMBAI

ITA 5451/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 0166 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 21-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMALD
• Section: 143(3)

Judgement Text

1 - IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI , , BEFORE HONBLE SHRI SAKTIJIT DEY, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO.5451/MUM/2019 ( / ASSESSMENT YEAR: 2009-10) & ./ I.T.A. NO.5452/MUM/2019 ( / ASSESSMENT YEAR: 2011-12) ITO - 21(2)(2) PIRAMAL CHAMBERS, FIRST FLOOR, ROOM NO. 109, LALBAUG PAREL MUMBAI 400 012. / VS. MAHAVIR ENGINEERING COMPANY 424A UNIT NO:10 2 ND FLR, RAUT INDL. ESTATE SENAPATI BAPAT MARG, MAHIM MUMBAI 400 016 $% # ./ # ./PAN/GIR NO. AAEFM-1894-N ( ' %' /APPELLANT ) : ( ()%' / RESPONDENT ) ASSESSEE BY : NONE REVENUE BY : MS. SMITA VERMA LD. SR. DR / DATE OF HEARING : 16/03/2021 / DATE OF PRONOUNCEMENT : 16/03/2021 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEALS BY REVENUE FOR ASSESSMENT YEAR S [AY IN SHORT] 2009-10 AND 2011-12 CONTEST COMMON ORDER OF LD. COM MISSIONER OF INCOME TAX (APPEALS)-48, MUMBAI [IN SHORT CIT(A) ] WHICH HAS RESTRICTED THE ADDITION ON ACCOUNT OF SUSPICIOUS PURCHASES TO THE EXTENT OF 15% AS AGAINST FULL ADDITION MADE BY LD. AO. 2 2. THOUGH NONE APPEARED FOR ASSESSEE, HOWEVER, MATE RIAL ON RECORD WAS SUFFICIENT FOR DISPOSAL OF THE APPEALS. THE LD. DR PLEADED FOR RESTORATION OF ASSESSMENT FRAMED BY LD. AO. 3.1 THE MATERIAL FACTS THAT THE ASSESSEE BEING RESI DENT FIRM STATED TO BE ENGAGED IN TRADING OF ELECTRICAL MOTORS AND PUMP S HAS BEEN ASSESSED, IN SIMILAR MANNER, FOR BOTH THE YEARS U/S 143(3) R.W.S. 147. THE ASSESSMENT WAS SO FRAMED PURSUANT TO RECEIPT OF CERTAIN INFORMATION FROM SALES TAX DEPARTMENT THAT THE ASSESSEE PROCURE D ACCOMMODATION PURCHASE BILLS FROM SUSPICIOUS DEALERS. THE ASSESSE E MADE PURCHASE OF RS.2.99 LACS FROM 2 PARTIES IN AY 2009-10 AS DETAIL ED IN THE ASSESSMENT ORDER. THE QUANTUM OF PURCHASE IN AY 2011-12 IS RS. 2.60 LACS. 3.2 THOUGH THE ASSESSEE FILED CERTAIN DOCUMENTARY E VIDENCES IN SUPPORT OF PURCHASES, HOWEVER, NOTICES ISSUED U/S 1 33(6) DID NOT ELICIT ANY SATISFACTORY RESPONSE. CONSEQUENTLY, THESE PURC HASES WERE DISALLOWED AND ADDED BACK TO ASSESSEES INCOME IN B OTH THE YEARS. 4. UPON FURTHER APPEAL, LD. CIT(A) NOTED THAT THE A SSESSEE WAS A TRADER AND THEREFORE, IT WOULD BE LOGICAL TO CONCLU DE THAT THE MATERIAL WAS PURCHASED FROM OTHER PARTIES IN THE GREY MARKET. AC CORDINGLY, IT WOULD BE A FIT CASE TO MAKE ESTIMATED ADDITIONS TO ACCOUNT F OR PROFIT ELEMENT EMBEDDED IN THESE TRANSACTIONS. THE ESTIMATION WAS DONE AT 15% FOR BOTH THE YEARS WHICH HAS GIVEN RISE TO REVENUES AP PEALS BEFORE US. 6. GOING BY THE FACTUAL MATRIX AND AFTER DUE CONSID ERATION OF FACTUAL MATRIX, WE FIND THAT THE ISSUE HAS BEEN CLINCHED IN RIGHT PERSPECTIVE BY LD. CIT(A). SINCE THE ASSESSEE WAS A TRADER, IT WAS A FIT CASE TO ESTIMATE THE PROFIT ELEMENT EMBEDDED IN THESE TRANSACTIONS. CONCURRING WITH FINDINGS OF LD. CIT(A) IN THE IMPUGNED ORDER, WE DI SMISS BOTH THE APPEALS. 3 7. BOTH THE APPEALS STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH MARCH, 2021. SD/- SD/- (SAKTIJIT DEY) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 16/03/2021 SR.PS, JAISY VARGHESE ! / COPY OF THE ORDER FORWARDED TO : 1. ' %'/ THE APPELLANT 2. ()%'/ THE RESPONDENT 3. !! (' ) / THE CIT(A) 4. !! / CIT CONCERNED 5. Z[ (\, !' \, / DR, ITAT, M UMBAI 6. []_ / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.