INCOME TAX OFFICER, 20(3)(2), MUMBAI V. SAMIULLAH M.K. ANSARI, MUMBAI

ITA 5650/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 3771 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 30-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase
• Section: 143(3); 147

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 5650 //2019 (. . 2009-10 ) ITA NO.5650/MUM/2019 (A.Y.2009-10) ITO-20(3)(2), R. NO. 612, 6 TH FLOOR, PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI-400012 ...... ) / APPELLANT VS. SAMIULLAH M.K. ANSARI, VAISHALI TUBE CENTER, 2 ND LANE CORNER, OPP. CASTROL LTD. MAGAZINE STREET,DARUKHANA, REAY ROAD, MUMBAI-400010. PAN: AFNPA4055P ..... *,/ RESPONDENT ) -/ APPELLANT BY : SHRI SUSHIL KUMAR MISHRA *, -/ RESPONDENT BY : NONE . / DATE OF HEARING : 30/03/2021 . / DATE OF PRONOUNCEMENT : 28/05/2021 / ORDER PER VIKAS AWASTHY, J.M: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-32, MUMBAI [HEREINAFTER REF ERRED TO AS THE CIT(A)] ' DATED 17.06.2019 FOR THE ASSESSMENT YEAR (AY) 2009- 10. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM TH E RECORDS ARE: THE ASSESSEE IS ENGAGED IN TRADING OF IRON & STEEL. ON THE BASIS OF INFORMATION RECEIVED FROM 2 . 5650 //2019 (. .2009-10 ) ITA NO.5650/MUM/2019 (A.Y.2009-10) THE SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA , THE ASSESSMENT FOR AY 2009-10 WAS RE-OPENED. AS PER THE INFORMATION RECEI VED, THE ASSESSEE HAD OBTAINED BOGUS PURCHASE BILLS AGGREGATING TO RS. 62 ,56,306/- FROM VARIOUS (NINE) HAWALA OPERATORS DURING THE PERIOD RELEVANT TO AY U NDER APPEAL. DURING ASSESSMENT PROCEEDINGS, THE ASSESSEE FAILED TO PROV E AUTHENTICITY OF DEALERS AND GENUINENESS OF THE GOODS PURCHASED. SINCE THE AO HA D ACCEPTED SALES DECLARED BY THE ASSESSEE, THE AO ESTIMATED GROSS PROFIT (GP) AT 12.5% OF BOGUS PURCHASES AND MADE ADDITION OF RS. 7,82,038/-. AGGRIEVED BY THE ASSESSMENT ORDER DATED 20.03.2015 PASSED UNDER SECTION 143(3) READ WITH SECTION 147 OF THE INCOME TAX ACT, 1961 [HEREINAFTER REFERRED TO AS THE ACT], THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) AFTER EXAMINING THE FACTS RESTRICTED THE ADDITION TO RS. 3,12,815/- BY ESTIMATING GP @ 5% OF BOGUS PURCHASES. AGAINST THE FINDINGS OF CIT( A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 3. SHRI SUSHIL KUAMR MISHRA REPRESENTING THE DEPART MENT VEHEMENTLY DEFENDED THE ASSESSMENT ORDER AND PRAYED FOR REVERS ING THE FINDINGS OF CIT(A). THE LD. DR SUBMITTED THAT THE ASSESSEE HAD OBTAINED BOGUS PURCHASE BILLS FROM HAWALA OPERATORS. THE ASSESSEE NEITHER PRODUCE THE DEALERS NOR THE ASSESSEE COULD FURNISH DOCUMENTARY EVIDENCE IN THE FORM OF S TOCK REGISTER, TRANSPORT RECEIPTS, ETC. TO SUBSTANTIATE TRAIL OF GOODS. THE ESTIMATION OF GP BY THE AO AT 12.5% OF THE BOGUS PURCHASES WAS REASONABLE AND THU S, THE SAME SHOULD BE SUSTAINED. 4. SUBMISSIONS MADE BY LD. DR HEARD, ORDERS OF AUTH ORITIES BELOW EXAMINED. UNDISPUTEDLY, THE ASSESSEE FAILED TO DISCHARGE HIS ONUS IN PROVING GENUINENESS OF 3 . 5650 //2019 (. .2009-10 ) ITA NO.5650/MUM/2019 (A.Y.2009-10) THE PURCHASES AND AUTHENTICITY OF THE DEALERS. THE AO HAD ACCEPTED THE SALES TURNOVER DECLARED BY THE ASSESSEE, THEREFORE, IT IS ONLY THE PROFIT EMBEDDED IN THE ALLEGED BOGUS PURCHASES THAT HAS TO BE BROUGHT TO T AX. GENERALLY, IN TRADING OF FERROUS AND NON-FERROUS METALS, THE GP RANGES BETWE EN 5% TO 8%. ESTIMATION OF GP AT 12.5% ON BOGUS PURCHASES BY AO IS ON HIGHER S IDE. THE CIT(A) HAS ESTIMATED GP AT 5% AND RESTRICTED THE ADDITION TO RS. 3,12,81 5/-. I FIND NO INFIRMITY IN THE IMPUGNED ORDER, HENCE, THE SAME IS UPHELD AND THE A PPEAL OF REVENUE IS DISMISSED, BEING DEVOID OF ANY MERIT. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY , THE 28 TH DAY OF MAY, 2021. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, 3/ DATED: 28/05/2021 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