RAJENDRA MADHANI, MUMBAI V. ASST CIT 15(1), MUMBAI

ITA 5528/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8681 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 09-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M C OMI NINGSHEN
• Keywords: Bogus purchase
• Section: 143(3); 142(1); 133(6)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE HONBLE S/SHRI JOGINDER SINGH (JM), AND RAJESH KUMAR, ( AM ) ./ I.T.A. NO . 5528 / MUM/20 1 6 ( / ASSESSMENT YEAR : 20 10 - 11 ) RAJENDRA MADHANI, ROOM NO.3,2 ND FLOOR, 477 - 479, MAULANA AZAD ROAD, GOLE DEVAL, MUMAI - 400004 / VS. THE ASSTT. . COMMISSIONER OF INCOME TAX - MATRU MANDIR, MUMBAI - . ( / APPELLANT ) .. ( / RESPONDENT ) ./P AN NO. : AA BPM2019A / APPELLANT BY: NONE / RESPONDENT BY SHRI M C OMI NINGSHEN / DATE OF HEARING : 10.10.2017 / DATE OF PRONOUNCEMENT : 25. 10 . 201 7 / O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE AND IT IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A) - 30, MUMBAI , D A T ED 15.7 .2016 PERTAINING TO A.Y. 20 10 - 11 . AT THE OUTSET, WE WOULD LIKE TO ME NTION HERE THAT NEITHER THE ASSESSEE N OR HIS AUTHORIZED REPRESENTATIVE APPEARED BEFORE THIS TRIBUNAL WHEN THE APPEAL WAS CALLED FOR HEARING NOR ANY APPLICATION SEEKING ADJOURNMENT OF I.T.A. NO. 5528 /MUM/2016 2 THE HEARING WAS RECEIVED IN THE OFFICE OF THE TRIBUNAL DESPITE SERVICE O F NOTICE THROUGH RPAD. THEREFORE, WE PROCEED TO DISPOSE OF THE APPEALS OF THE ASSESSEE EX - PARTE AFTER HEARING THE LD. DR. 2. ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST THE CONFIRMATION OF ADDITION OF RS. 11,20,559/ - BEING 15% OF TOTAL PURCHASES OF RS.74 ,70,395/ - BY CIT(A) AS AGAINST 100% ADDITION BY THE A.O. 3 . FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME ON 25 .9.20 10 DECLARING TOTAL INCOME OF RS.1,01,20,319 / - WHICH WAS PROCESSED U/S 143(1) OF THE ACT . S UBSEQUENTLY THE CASE WAS SELEC TED FOR SCRUTINY AND NOTICES U /S 143(2) AND 142(1) WERE ISSUED AND SERVED UPON THE ASSESSEE. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE SUBMITTED PARTY - WISE DETAILS OF PURCHASES TO THE AO. THE AO IN ORDER TO VERIFY THE PURCHASES, ISSUED NOTICED U/S 133(6) OF THE ACT TO 8 PARTIES AS MENTIONED IN PARA 4.1 OF THE ASSESSMENT ORDER , WHICH WERE DULY COMPLIED BY THE PARTIES. IN THE MEANTIME, THE AO RECEIV ED THE INFORMATION FROM THE SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA THAT THE ASSESSEE HAS MAD E BOGUS PURCHASES FROM 5 PARTIES AS MENTIONED IN PARA 4.2 OF THE ASSESSMENT ORDER TO WHOM THE AO ISSUED NOTICES U/S 133(6) ON THE ADDRESSES GIVEN BY THE ASSESSEE. HOWEVER, SOME NOTICES ISSUED U/S 133(6) WERE RETURNED UNSERVED AND THE ASSESSEE WAS ASKED TO PROVE GENUINENESS OF THE PURCHASES WHICH WAS REPLIED BY THE ASSESSEE VIDE LETTER DATED 18.2.2013 . IN THE ASSESSMENT PROCEEDINGS, THE ASSESSEE SUBMITTED THE PURCHASE BILLS, PROOF OF PAYMENTS AND DETAILS OF I.T.A. NO. 5528 /MUM/2016 3 CONSUMPTION OF MATERIAL DURING MANUFACTURING PRO CESS ETC . HOWEVER, THE AO WAS NOT SATISFIED WITH THE REPLY OF THE ASSESSEE. HE DISALLOWED THE ENTIRE BOGUS PURCHASE S TO THE TUNE OF RS.74,70,395/ - BY FRAMING THE ASSESSMENT U/S 143(3) OF THE ACT VIDE ASSESSMENT ORDER DATED 22.3.2013. IN THE APPELLATE P ROCEEDINGS , THE LD.CIT(A) REDUCED THE ADDITION TO 15% OF THE TOTAL BOGUS PURCHASES AFTER CONSIDERING THE SUBMISSIONS AND ARGUMENTS OF THE ASSESSEE. THE ASSESSEE STILL AGGRIEVED BY THE ORDER OF CIT(A) PREFERRED AN APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE CA REFULLY CONSIDERED THE CONTENTIONS OF THE LD. DR AND PERUSED THE MATERIAL PLACED BEFORE US INCLUDING THE ORDERS OF AUTHORITIES BELOW. THE UNDISPUTED FACTS ARE THAT THE ASSESSEE IS A BENEFICIARY OF BOGUS PURCHASES FROM FIVE PARTIES AGGREGATING TO RS.74,70,3 95/ - . THE ASSESSEE COULD NOT PROVE THE GENUINENESS OF THE PURCHASE S. M OREOVER, THE NOTICES ISSUED U/S 133(6) OF THE ACT WAS RETURNED UNSERVED. U NDER THE PRESENT CIRCUMSTANCES, UNDISPUTEDLY THE ASSESSEE HAS AVAILED THE BOGUS BILLS WITHOUT TAKING ANY ACTU AL DELIVERY OF GOODS AND IN SUCH TYPE OF CASE THE GP HAS TO BE ESTIMATED. THUS WE ARE IN AGREEMENT WITH THE CONCLUSION DRAWN BY THE LD.CIT(A) ON THE ISSUE OF ESTIMATION OF GP OF BOGUS PURCHASE. ACCORDINGLY, WE UPHOLD THE ORDER OF THE LD.CIT(A) BY DISMIS SING THE APPEAL OF THE ASSESSEE. I.T.A. NO. 5528 /MUM/2016 4 5 . IN THE RESULT, THE A PPEAL OF THE ASSESSEE STANDS DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 25 TH OCT, 2017 . 25TH OCT . 2017 S D SD (JOGINDER SINGH ) ( RAJESH KUMAR ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 25 . 1 0. 2017 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. 6. , , / DR, ITAT, MUMBAI CONCERNED / GUARD FILE. / BY ORDER, T RUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI