ITO 17(2)(4), Mumbai V. SHRI. NARENDRA , Mumbai

ITA 571/MUM/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3580 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 04-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH DESHPANDE
• Section: 143(1); 147; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHR I G. MANJUNATH A , ACCOUNTANT MEMBER ITA NO. 571 / MUM . /201 9 ( ASSESSMENT YEAR : 20 09 10 ) INCOME TAX OFFICER WARD 17(2)(4), MUMBAI . APPELLANT V/S SHRI NARENDRA MANGANLAL MEHTA 402, STEEL CENTRE S.T. ROAD, MUMBAI 400 009 PAN AGZPM4547P . RESPONDENT REVENUE BY : S HRI SAURABH DESHPANDE ASSESSEE BY : NONE DATE OF HEARING 0 3 .0 2 .2020 DATE OF ORDER 04.03.2020 O R D E R PER SAKTIJIT DEY. J.M. THE CAPTIONED APPEAL HAS BEEN FILED BY THE REVENUE CHALLENGING THE ORDER DATED 12 TH N OVEMBER 2018 , PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 58 , MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 20 09 10 . 2. THE DISPUTE IN THE PRESENT APPEAL IS CONFINED TO THE DECISION OF LEARNED COMMISSIONER (APPEALS) IN RESTRICTING THE DISALLOWANCE ON 2 SHRI NARENDRA ACCOUNT OF NON GENUINE PURCHASES TO 12.5% AS AGAINST THE FULL ADDITION MADE BY THE ASSESSING OFFICER. 3. WHEN THE APPEAL WAS CA LLED FOR HEARING, NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE TO REPRESENT THE CASE. THERE IS NO APPLICATION SEEKING ADJOURNMENT EITHER . ACCORDINGLY, WE PROCEED TO DISPOSE OFF THE APPEAL EX PARTE QUA THE ASSESSEE AFTER HEARING THE LEARNED DEPARTMENTAL REP RESENTATIVE AND ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 4. BRIEF FACTS ARE, THE ASSESSEE IS AN INDIVIDUAL. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HIS RETURN OF INCOME ON 28 TH SEPTEMBER 2009, DECLARING INCOME OF ` 9,88,430.THE RETURN OF INCOME FILED BY THE ASSESSEE WAS INITIALLY PROCES SED UNDER SECTION 143(1) OF THE ACT. SUBSEQUENTLY, ON THE BASIS OF INFORMATION RECEIVED FROM SALE S TAX DEPARTMENT THROUGH THE OFFICE OF THE DGIT (INV.), MUMBAI, THAT PURCHASES WORTH ` 2,33,714, CLAIMED TO HAVE BEEN MADE DURING THE YEAR FROM SHRI SAI TRADING CO. IS NON GENUINE, AS , THE CONCERNED PARTY HAS BEEN IDENTIFIED AS A HAWALA OPERATO R PROVIDING ACCOMMODATION BILLS, T HE ASSESSING OFFICER RE OPENED THE ASSESSMENT UNDER SECTION 147 OF THE ACT. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER ISSUED STATUTORY NOTICES ALONG WITH QUESTIONNAIRE REQUIRING THE ASSESSEE TO FURNISH NECESSARY DETAILS TO PROVE THE PURCHASES. HOWEVER, AS ALLEGED BY THE ASSESSING OFFICER, THE ASSES SEE 3 SHRI NARENDRA DID NEITHER COMPLIED EVEN TO A SINGLE NOTICE ISSUED BY THE ASSESSING OFFICER NOR HE APPEARED IN THE ASSESSMENT PROCEEDINGS,. THUS, THE ASSES SING OFFICER PROCEEDED TO COMPLETE THE ASSESSMENT UNDER SECTION 144 OF THE ACT TO THE BEST OF HIS JUDGMENT . ON T HE BASIS OF MATERIAL AVAILABLE ON RECORD, THE ASSESSING OFFICER ULTIMATELY CONCLUDED THAT THE PURCHASES WORTH ` 2,33,714 ARE NON GENUINE AND ACCORDINGLY ADDED BACK TO THE INCOME OF THE ASSESSEE. THE ASSESSEE CONTESTED THE AFORESAID ADDITION BEFORE THE FIRS T A PPELLATE AUTHORITY. HOWEVER, BEFORE LEARNED COMMISSIONER (APPEALS) ALSO, THE ASSESSEE DID NOT APPEAR IN PERSON, BUT MADE HIS SUBMISSIONS THROUGH E MAIL. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE IN THE CONTEXT OF F ACTS AND MATERIAL ON RECORD, LE ARNED COMMISSIONER (APPEALS) RESTRICTED THE ADDITION TO 12.5% OF THE NON GENUINE PURCHASES. 5. WE HAVE C ONSIDERED THE SUBMISSIONS OF LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL ON RECORD. NO DOUBT, IN THE C OURSE OF ASSESSMENT PROCEEDINGS TH E ASSESSEE HAS NEITHER APPEARED NOR FURNISHED ANY EVIDENCE TO PROVE THE GENUINENESS OF PURCHASES MADE FROM THE DECLARED SOURCE. HOWEVER, THE ASSESSING OFFICER HAS NOT DOUBTED THE SALES EFFECTED BY THE ASSESSEE. THAT BEING THE CASE, THE ENTIRE PURCHASES CAN NOT BE DISALLOWED AND ADDED BAC K TO THE INCOME OF THE ASSESSEE, B UT ONLY THE PROFIT ELEMENT EMBEDDED IN SUCH PURCHASES CAN BE CONSIDERED FOR ADDITION. IN THE AFORESAID VIEW OF THE 4 SHRI NARENDRA MATTER, WE ARE IN AGREEMENT WITH THE LEARNED COMMISSIONER (APPEALS) IN RESTR ICTING THE ADDITION TO 12.5% OF THE NON GENUINE PURCHASES. ACCORDINGLY, WE UPHOLD THE OR DER OF LEARNED COMMISSIONER (APPEALS) BY DISMISSING THE GROUND RAISED BY THE REVENUE. 6. IN THE RESULT, APPEAL STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN C OURT ON 04.03.2020 SD/ - G. MANJUNATH A ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 04.03.2020 COPY OF THE ORDER FORWARDED TO : (1) THE ASSESSEE; (2) THE REVENUE; (3) THE CIT(A); (4) THE CIT, MUMBAI CITY CONCERNED; (5) THE DR, ITAT, MUMBAI; (6) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY ASSISTANT REGISTRAR ITAT, MUMBAI