PRAVINA N. RUPAREL, MUMBAI V. ITO 7(3)(3), MUMBAI

ITA 5651/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9735 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2004-2005
• Appeal Filed On: 19-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained investment; Salary income
• Section: 69C; 143(3); 147

Judgement Text

I.T.A. NO.5651/MUM/2016 1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I, MUMBAI BEFORE SHRI P. K. BANSAL, VICE PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER I.T.A. NO.5651/MUM/2016 ASSESSMENT YEAR:2009-10 M/S PRAVINA N. RUPAREL, A/202, MEELKANTH DHARA, OPP. DHANWANTRI HOSPITAL, N. R. ROAD, MULUND (W), MUMBAI. PAN:ADOPR 0943 E VS. I.T.O.-7(3)(3), MUMBAI. (APPELLANT) (RESPONDENT) O R D E R PER P. K. BANSAL, V.P. THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) DATED 26/07/2016 RELATING TO ASSESSMENT YEAR 2009-10. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL RELATES T O THE SUSTENANCE OF ADDITION OF RS.5,61,144/- MADE BY THE ASSESSING OFF ICER. 3. THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE AS SESSEE FILED THE RETURN OF INCOME ON 06/09/2009 DECLARING TOTAL INCOME OF R S.5,98,854/-. SUBSEQUENTLY, THE ASSESSMENT U/S 147 READ WITH SECT ION 143(3) WAS MADE ON AN INCOME OF RS.11,00,000/- BY MAKING ADDITION U /S 69C OF THE ACT AMOUNTING TO RS.5,61,144/-. DURING THE COURSE OF A SSESSMENT, THE APPELLANT BY SHRI D. C. JAIN, ADVOCATE RESPONDENT BY SHRI V. VIDHYADHAR, D.R. DATE OF HEARING 06/09/2017 DATE OF PRONOUNCEMENT 11/09/2017 I.T.A. NO.5651/MUM/2016 2 ASSESSING OFFICER NOTED ON THE BASIS OF INFORMATION FROM MAHARASHTRA SALES TAX DEPARTMENT THAT THE ASSESSEE IS ONE OF THE BENE FICIARIES OF THE BOGUS BILLS FOR THE PURCHASES ISSUED BY VARIOUS PARTIES. ON VERIFICATION IT WAS FOUND THAT THE ASSESSEE GOT THE SUPPLIES FROM (I) M /S MAHAVIR ENTERPRISES, (II) M/S SHREE GANESH TRADING COMPANY AND (III) M/S SHREYAS MARKETING AGENCY. THE ASSESSING OFFICER NOTED THAT THE ASSES SEE MADE THE PURCHASES AMOUNTING TO RS.73,38,240/- FROM THESE PARTIES. NO TICES U/S 136 WERE ISSUED TO ALL THE AFORESAID PARTIES. HOWEVER, NONE OF THE PARTIES HAVE RESPONDED TO THE SAID NOTICES. THE ASSESSEE SUBSEQU ENTLY FILED RELEVANT DOCUMENTS IN RESPECT OF THESE PURCHASES, SALES, MOD E OF PAYMENT AND TRANSPORT RECEIPT ETC. THE ASSESSING OFFICER WAS N OT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AND THEREFORE, HE WORKE D OUT THE PEAK PAYMENT OF THE PURCHASES AND DISALLOWED THE SAME U/ S 69C AT RS.5,61,144/-. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE ORDER OF THE ASSESSING OFFICER. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, CAREFULLY C ONSIDERED THE SAME ALONG WITH THE ORDERS OF THE AUTHORITIES BELOW. LE ARNED A.R. EVEN THOUGH VEHEMENTLY CONTENDED BEFORE US THAT THE ASSESSEE IS EARNING DERIVING INCOME FROM SALARY CARRYING ON PROPRIETARY BUSINESS OF M/S SUPREME ENTERPRISES ENGAGED IN THE BUSINESS OF BUYING OF CH EMICAL FROM MARKET AND EXPORTING TO OUTSIDE INDIA. THE TOTAL PURCHASES, W E NOTED, FROM VARIOUS PARTIES WERE TO THE EXTENT OF RS.2,17,42,073/- BUT THE PURCHASES FROM THESE THREE PARTIES WERE TO THE EXTENT OF RS.73,38,240/-. WE NOTED THAT THE ASSESSEE HAS SHOWN GROSS PROFIT @4.78% IN THE ASSES SMENT YEAR 2010-11 WHILE IN THE ASSESSMENT YEAR 2009-10 IT WAS 3.13%. IT IS NOT A CASE WHERE THE ASSESSING OFFICER HAD MADE THE ADDITION IN RESP ECT OF THE PURCHASES BUT THE ASSESSING OFFICER HAD ONLY ADDED THE PEAK PURCH ASES. IN OUR OPINION, THE ONUS IS ON THE ASSESSEE TO PROVE THE GENUINITY OF THE PURCHASES. IN THIS CASE THE ASSESSEE FAILED TO PROVE THE GENUINITY OF THE PURCHASES. ONCE THE I.T.A. NO.5651/MUM/2016 3 ASSESSEE HAS FAILED TO PROVE THE GENUNINITY OF THE PURCHASES, EVEN THOUGH THE ASSESSEE HAS SUBMITTED THE EVIDENCE IN THE FORM OF PURCHASE INVOICES AND SALES INVOICES BUT DID NOT FILE ANY QUANTITATIV E RECONCILIATION TO PROVE THAT ALL THE PURCHASES ARE MADE FROM THE GENUINE SU PPLIERS. IT IS A CASE WHERE THE ASSESSING OFFICER HAS NOT MADE THE ADDITI ON IN RESPECT OF ALL THE PURCHASES BUT THE ASSESSING OFFICER, IN OUR OPINION , WAS JUST AND FAIR TO MAKE THE ADDITION BY WORKING OUT THE PEAK OF SUCH P URCHASES AS TO THAT EXTENT THE AMOUNT INVESTED BY THE ASSESSEE IN SUCH PURCHASES WERE UNEXPLAINED INVESTMENT. LEARNED A.R. EVEN THOUGH C ONTENDED THAT THE ASSESSEE HAS NOT BEEN GIVEN PROPER OPPORTUNITY BY T HE ASSESSING OFFICER BUT FROM THE MATERIAL AVAILABLE ON RECORD, WE NOTED THAT THE ASSESSING OFFICER HAD GIVEN PROPER NOTICE TO THE ASSESSEE AND EVEN IN ASSESSMENT YEAR 2010-11 THIS TRIBUNAL IN I.T.A.NO.7424/MUM/201 4 VIDE ITS ORDER DATED 20/06/2016 SUSTAINED THE DISALLOWANCE OF 5% OF THE PURCHASES MADE FROM THE SAME VERY PARTIES. THE DISALLOWANCE IN THIS CA SE MADE BY THE ASSESSING OFFICER IS NEAR 5%. WE, THEREFORE, DO NOT FIND ANY INFIRMITY OR ILLEGALITY IN SUSTAINING THE DISALLOWANCE BY THE CIT(A). 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON ./09/2017 ) SD/- SD/- (PAWAN SINGH ) ( P. K. BANSAL ) JUDICIAL MEMBER VICE PRESIDENT DATED: 11/09/2017 *SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., ASST T. REGISTRAR