ITO - 27 (1)(4), MUMBAI V. ELITE ELECTRICALS, MUMBAI

ITA 5626/MUM/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 2025 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-12-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 04-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase; Tax effect
• Section: 271(1)(c); 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E , MUMBAI BEFORE SHRI C.N. PRASAD , HONBLE JUDICIAL MEMBER AND SHRI MANOJ KUMAR AGGARWAL , HONBLE ACCOUNTANT MEMBER ITA NO . 5626 /MUM/201 8 ( A.Y: 201 0 - 11) INCOME TAX OFFICER 27 ( 1 )(4 ) TOWER NO. 6, 4 TH FLOOR, ROOM NO. 409 VASHI RLY. STATION COMPLEX VASHI, NAVI MUMBAI V. M/S. ELITE ELECTRICALS 4, GANGA ANNEX, NAVA SHRINAGAR CHS P.L. LOKHANDE MARG, CHEMBUR MUMBAI 400 089 PAN: AABFE5409Q (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : SHRI MAURYA PRATAP DATE OF HEARING : 03.12.2019 DATE OF PRONOUNCEMENT : 03.12.2019 O R D E R PER C.N. PRASAD (JM) THIS APPEAL IS FILED BY THE R EVENUE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 24 , MUMBAI [HEREINAFTER IN SHORT LD.CIT(A)] DATED 29.06.2018 FOR THE ASSESSMENT YEAR 2010 - 11 . 2. THE REVENUE IN ITS APPEAL HAS RAISED THE FOLLOWING GROUNDS : - ' 1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) WAS CORRECT IN DELETING T HE PENALTY LEVIED OF RS. 69,104/ - U/S. 271(1)(C) OF THE IT ACT AS THE PENALTY WAS LEVIED ON QUANTUM ADDITIONS MADE ON ACCOUNT OF BOGUS PURCHASES, WITHOUT APPRECIATING THAT THE ONUS WAS ON THE ASSESSEE TO ESTABLISH THE GENUINENESS OF SUCH PURCHASES BY 2 ITA NO. 5626/MUM/2018 (A.Y: 2010 - 11) M/S. ELITE ELECTRICALS PRODUCING SUCH PARTIES BEFORE THE ASSESSING OFFICER AND THE ASSESSEE FAILED TO DISCHARGE ITS ONUS? 2) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) WAS CORRECT IN HOLDING TH AT THE AO HAD MADE ADHOC ADDITIONS WITHOUT APPRECIATING THAT THE AO HAD LEVIED PENALTY, ONLY AFTER VERIFYING THE FACT THAT THE ASSESSEE EVADED THE TAXES ON QUANTUM OF ADDITIONS MADE ON ACCOUNT OF BOGUS PURCHASES AND THE ASSESSEE FAILED TO ESTABLISH THE GEN UINENESS OF SUCH PURCHASES? 3) THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUNDS BE REVERSED AND THAT OF THE ASSESSING OFFICER BE RESTORED. 4) THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUNDS OR ADD A NEW GROUND WHICH MAY BE NEC ESSARY. 3. AT THE TIME OF HEARING, WHEN IT WAS POINTED OUT TO THE LD. DR THAT THE REVENUE EFFECT IN THIS APPEAL IS BELOW .50 LAKHS THE LD. DR THOUGH AGREED THAT TAX EFFECT ON THE ISSUE IN THE PRESENT APPEAL IS BELOW . 5 0 LAC S AND IN VIEW OF THE CBDT CIRCULAR N O . 17/2019 DATED 08.08.2019 IN F.NO.279/MISC.142/2007 - ITJ (PT) , THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE , IT IS SUBMITTED THAT THIS APPEAL IS FILED AGAINST DELETION OF PENALTY OF .69,104/ - LEVIED U/S. 271(1)(C) OF THE ACT ON THE DISALLOWANCE MADE TOWARDS BOGUS PURCHASES. 4. WE HAVE HEARD THE SUBMISSIONS AND PERUSED THE GROUNDS OF APPEAL IN THIS APPEAL. WE FIND THAT THE TAX EFFECT IN THIS APPEAL IS LESS THAN .5 0 LAKHS AND T HEREFORE THE APPEAL OF THE R EVENUE IS NOT MAINTAINABLE ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE CBDT CIRCULAR NO. 17/2019 DATED 08.08.2019. WE ALSO OBSERVED THAT SINCE THE ISSUE IS IN RESPECT OF 3 ITA NO. 5626/MUM/2018 (A.Y: 2010 - 11) M/S. ELITE ELECTRICALS LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT NONE OF THE EXCEPTION IN THE CIRCULAR ARE APPLICABLE. HENCE TH IS APPEAL IS DISMISSED. 5. IN THE RESULT, APPEAL OF THE R EVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 03 RD DECEMBER , 2019 S D/ - SD/ - ( MANOJ KUMAR AGGARWAL ) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI / DATED 03/12/ 2019 GIRIDHAR, SR.PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// BY ORDER, (ASSTT. REGISTRAR) ITAT, MUM