ITO WARD 2(4), MUMBAI V. M/S SUNRISE INDUSTRIES, , MUMBAI

ITA 5503/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2015 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 23-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DEEPAK RAJE
• Keywords: Bogus purchase

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 5503 //2019 (. . 2011-12 ) ITA NO.5503/MUM/2019 (A.Y.2011-12) ITO WARD-2(4), 2 ND FLOOR, MOHAN PLAZA BUILDING, WAYLE NAGAR, KHADAKPADA, KALYAN (WEST)-421301. ...... ) / APPELLANT VS. M/S SUNRISE INDUSTRIES PLOT NO. D/10, MURBAD, THANE-421401. PAN: ABEFS8084M . .... *,/ RESPONDENT ) -/ APPELLANT BY : SH. SUSHIL KUMAR MISHRA *, -/ RESPONDENT BY : SH. DEEPAK RAJE . / DATE OF HEARING : 30/03/2021 . / DATE OF PRONOUNCEMENT : 10/06/2021 / ORDER PER VIKAS AWASTHY, J.M: THIS APPEAL BY THE REVENUE IS AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-3, THANE [HEREINAFTER REFERRED TO AS THE CIT(A)] DATED 06.06.2019 FOR THE ASSESSMENT YEAR (AY) 2011-12. 2 . 5503 //2019 (. .2011-12 ) ITA NO.5503/MUM/2019 (A.Y.2011-12) 2. SHRI DEEPAK RAJE APPEARING ON BEHALF OF THE ASSE SSEE SUBMITTED THAT THE ASSESSMENT IN THE CASE OF ASSESSEE WAS RE-OPENED AN D ADDITION OF RS. 3,02,787/- WAS MADE ON ACCOUNT OF BOGUS PURCHASES F ROM TWO DEALERS I.E. (I) SKAND INDUSTRIES RS. 2,49,315/- (II) SAMIR TRADING CORPORATION RS. 53,472/- 3. THE LD. AR SUBMITTED THAT THE ASSESSEE COULD NO T APPEAR BEFORE THE ASSESSING OFFICER (AO) AND FURNISH EVIDENCE TO PROV E GENUINENESS OF THE SALES, THEREFORE, THE AO MADE ADDITION OF THE ENTIRE ALLEG ED BOGUS PURCHASES. IN FIRST APPELLATE PROCEEDINGS, THE ASSESSEE FURNISHED RELEV ANT DOCUMENTS TO PROVE GENUINENESS OF THE PURCHASES. THE CIT(A) SOUGHT REM AND REPORT FROM THE AO ON THE EVIDENCES FILED BY THE ASSESSEE. AFTER CONSI DERING THE SUBMISSIONS OF THE ASSESSEE AND THE REMAND REPORT, THE CIT(A) REST RICTED THE ADDITION TO 20% OF THE ALLEGED BOGUS PURCHASES, THE ASSESSEE HAS AC CEPTED THE SAME. 4. SHRI SUSHIL KUMAR MISHRA REPRESENTING THE DEPART MENT STRONGLY SUPPORTED THE ASSESSMENT ORDER. THE LD. DR SUBMITTE D THAT THE ASSESSEE FAILED TO APPEAR BEFORE THE AO DESPITE SERVICE OF NOTICES, NO DOCUMENTARY EVIDENCE WAS FILED BY THE ASSESSEE TO DISCHARGE ITS ONUS IN PROVING GENUINENESS OF THE PURCHASES AND THE DEALERS. THE AO RIGHTLY DISALLOWE D ENTIRE BOGUS PURCHASES. THE LD. DR IN SUPPORT OF HIS SUBMISSION PLACED RELI ANCE ON THE DECISION OF HONBLE SUPREME COURT OF INDIA IN THE CASE OF N.K. PROTEINS LTD. V/S DCIT. 5. BOTH SIDES HEARD, ORDERS OF AUTHORITIES BELOW EX AMINED. UNDISPUTEDLY, THE AO HAS ACCEPTED THE SALES TURNOVER DECLARED BY THE ASSESSEE. WITHOUT PURCHASES THERE CANNOT BE SALES, THEREFORE, ENTIRE ALLEGED BOGUS PURCHASES 3 . 5503 //2019 (. .2011-12 ) ITA NO.5503/MUM/2019 (A.Y.2011-12) CANNOT BE ADDED. IT IS ONLY THE PROFIT ELEMENT EMBE DDED IN SUCH TRANSACTIONS THAT HAS TO BE BROUGHT TO TAX. IN FIRST APPELLATE P ROCEEDINGS, THE ASSESSEE HAS FURNISHED DOCUMENTS TO SUBSTANTIATE GENUINENESS OF THE PURCHASES ALLEGEDLY MADE FROM SUSPICIOUS DEALERS. THE CIT(A) UPHELD THE FINDINGS OF AO TO THE EXTENT THAT THE PURCHASES ARE NON-GENUINE, HOWEVER, THE CIT(A) RESTRICTED THE ADDITION BY ESTIMATING GROSS PROFIT @ 20% ON THE BO GUS PURCHASES. I FIND NO ERROR IN THE IMPUGNED ORDER, HENCE, THE SAME IS UPH ELD AND APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THURSDAY , THE 10 TH DAY OF JUNE, 2021. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, 3/ DATED: 10/06/2021 SK, PS * 4 * 4 * 4 * 4 COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT , 2. *, / THE RESPONDENT. 3. 5 ( )/ THE CIT(A)- 4. 5 CIT 5. * , . . . , / DR, ITAT, MUMBAI 6. 9 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI