ITO WD 1(4), THANE V. JAYA NARESH PURSWAMI, THANE

ITA 5672/MUM/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9408 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 18-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARJU GARODIA
• Assessee Lawyers: DIVESH DOSHI
• Keywords: Bogus purchase; Accommodation entries
• Section: 143(3); 133(6); 147

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI . . , , BEFORE SHRI C.N. PRASAD , JM AND SHRI RAJESH KUMAR, AM ITA NO. 5672 / MUM/ 2 0 1 5 ( / ASSESSMENT YEAR: 2 0 10 - 11 ) INCOME TAX OFFICER - 1 ( 4 ), ROOM NO. 11 , B WING, 6 TH FLOOR, ASHAR IT PARK, WAGLE ESTATE, THANE(W) / VS. JAYA NARESH PURSWAMI, 1703, LIGHT BRIDE, HIRANANDANI MEADOWS, GLADYS ALWARES ROAD, THANE. ( / APPELLANT) : ( / RESPONDENT ) ( / APPELLANT) : ( / RESPONDENT ) ./ PAN : AIJPP3290L ( / APPELLANT) : ( / RESPONDENT ) / REVENUE BY : SHRI ARJU GARODIA / ASSESSEE BY : SHRI DIVESH DOSHI / DATE OF HEARING : 2 8 .9. 2017 / DATE OF PRONOUNCEMENT : 2 8 . 9 . 201 7 / O R D E R PER RAJESH KUMAR, A. M: THE CAPTIONED IS APPEAL BY THE REVENUE PERTAINING TO ASSESSMENT YEAR S 201 0 - 11 . THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE CIT(A) - 1 , THANE , DATED 2 1.9. 201 5 WHICH IN TURN HAS ARISEN FROM AN ORDER PASSED BY 2 ITA NO. 5672 /MUM/201 5 THE ASSESSING OFFICER DATED 19.3. 201 5 UNDER SECTION 143(3) R.W.S.147 OF THE ACT. 2. THE SOLE ISSUE RAISED B Y THE REVENUE IS AGAINST THE DELETION OF ADDITION IN RESPECT OF BOGUS PURCHASE TO THE TUNE OF 87.5% BY CIT(A) AS AGAINST 100% ADDITIONS OF BOGUS PURCHASES MADE BY THE AO. 3. FACTS OF THE CASE ARE THE AO RECEIV ED THE INFORMATION FROM THE DGIT(INV) WHO IN TU RN WAS PASSED ON THE INFORMATION BY THE SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA THAT THE ASSESSEE HAS OBTAINED ACCOMMODATION ENTRIES FOR PURCHASE S THROUGH THE PARTIES DECLARED AS HAWALA OPERATORS BY THE SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASH TRA . ACCORDINGLY, THE ASSESSMENT OF THE ASSESSEE WAS REOPENED BY ISSUING NOTICE U/S 147 R.W.S.148 OF THE ACT A FTER RECORDING THE REASONS TO BELIEVE THAT THE INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT. THEREAFTER THE STATUTORY NOTICES U/S 143(2) AND 14 2(1) WERE ISSUED AND SERVED UPON THE ASSESSEE. DURING THE COURSE OF RE - ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO PROVE THE GENUINENESS OF THE PURCHASES MADE FROM THE TWO PARTIES VIZ AMIZARA TRADING CORPORATION AMOUNTING TO RS.31,64,073/ - AND S M TR ADING CO.RS.5,63,077/ - AGGREGATING TO RS.37,27,150/ - . HOWEVER, THE ASSESSEE NEITHER REPLIED NOR FURNISHED ANY INFORMATION AS CALLED FOR BY THE AO. MOREOVER, THE NOTICES 3 ITA NO. 5672 /MUM/201 5 U/S 133(6) OF THE ACT ISSUED TO THE SAID TWO PARTIES WERE RETURNED UNSERVED. ACCO RDINGLY, THE AO DISALLOWED AND ADDED THE ENTIRE AMOUNT OF BOGUS PURCHASES BY FRAMING THE ASSESSMENT U/S 143(3) R.W.S.147 OF THE ACT VIDE ASSESSMENT ORDER DATED 19.3.2014 ASSESSING THE TOTAL INCOME OF THE ASSESSEE AT RS.51,60,620/ - . AGGRIEVED BY THE ACT ION OF THE AO, THE ASSESSEE APPEALED BEFORE THE FAA, WHO AFTER CONSIDERING THE SUBMISSIONS AND EXAMINING THE RECORD S PLACED BEFORE HIM PARTLY ALLOWED THE APPEAL OF THE ASSESSEE BY SUSTAINING THE BOGUS PURCHASES AT THE RATE OF 12.5% OF THE PURCHASES BY RE LYING ON THE DECISION OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT V/S SIMIT P SHETH, 356 ITR 451. AGGRIEVED BY THE ORDER OF FAA, THE REVENUE IS IN APPEAL BEFORE US. 4 . AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERUSING THE RELEVANT RECORDS A S PLACED BEFORE US , WE FIND THAT THE ASSESSEE HAS INDISPUTABLY AVAILED THE BOGUS ENTRIES OF PURCHASES FROM HAWALA TRADERS TO THE TUNE OF RS.37,21,150/ - WHICH COULD NOT BE PROVED DURING THE ASSESSEE DURING ASSESSMENT PROCEEDINGS AS GENUINE . MOREOVER, THE ASSESSEE DID NOT FILE ANY INFORMATION /DETAILS AND RECORD AS CALLED FOR BY THE AO AND THE NOTICES ISSUED U/S 133(6) OF THE ACT WERE RETURNED UNSER V ED. HOWEVER, THE ASSESSEE FILED THE DETAILED SUBMI SSIONS BEFORE THE LD.CIT(A) WHO AFTER TAKING INTO ACCOUNT THE BILLS ,VOUCHERS,BANK STATEMENTS ETC SUBMISSIONS 4 ITA NO. 5672 /MUM/201 5 AND CONTENTIONS REDUCED THE ADDITION TO THE EXTENT OF 87.50% AND SUSTAINED TO THE TUNE OF 12.5% OF THE TOTAL PURCHASE S AND THUS ALLOWED THE APPEAL PARTLY . HAVING CONSIDERED THE FACTS ON RECORDS AND AFTER HEARING BOTH THE PARTIES, WE ARE OF THE CONSIDERED VIEW THAT THE LD.CIT(A) HAS PASSED A VERY BALANCE AND REASONED DECISION IN THE MATTER. THEREFORE, WE ARE NOT INCLINED TO INTERFERE WITH IT. 5 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 8 TH SEPT , 2017. S D SD (C.N. PRASAD) (RAJESH KUMAR) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 28TH SEPT .2017 SRL,SR.PS / COPY OF THE ORDER FORWARDED TO : 1. / THE AP PELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, T RUE COPY / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI