ITO - 13(1)(2), MUMBAI V. UNITED ASPHALTERS PVT. LTD., MUMBAI

ITA 5725/MUM/2018

• Counselvise Citation: [2019] 111 COUNSELVISE.COM (IT) 4003 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2019
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2009-2010
• Appeal Filed On: 05-10-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MOHAMMED RIZWAN
• Keywords: Bogus purchase; Depreciation
• Section: 143(1); 274

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JM & SHRI S . RIFAUR RAHMAN, AM ./ I.T.A. NO . 5725 / MUM/ 2018 ( / ASSESSMENT YEAR: 2009 - 10 ) I.T.O. 13(1) (2), 2 ND FLOOR, ROOM NO. 225, AAYKAR BHAVAN, M.K. ROAD, MUMBAI - 400025. / VS. UNITED ASPHALTERS PVT. LTD 3A/6 MAJITHIA NAGAR, S.V.ROAD, KANDIVALI (W), MUMBAI - 400067. ./ ./ PAN NO. AAACU 4547 K ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI MOHAMMED RIZWAN, DR / RESPONDENTBY : SHRI DHAVAL SHAH, AR / DATE OF HEARING : 12.12.2019 / DATE OF PRONOUNCEMENT : 18 .12.2019 / O R D E R PER S. RIFAUR RAHMAN, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) - 21 IN SHORT REFERRED AS LD. CIT(A), MUMBAI, DATED 29/06/2018 FOR ASSESSMENT YEAR (IN SHORT AY) 2009 - 10 , WHEREBY THE LD. CIT(A) ALLOWED THE APPEAL FILED BY THE ASSESSEE AGAINST THE PENALTY ITA NO. 5725/MUM/2018 A.Y 2009 - 10 M/S. UNITD ASPHALTERS P.LTD . - 2 - ORDER PASSED U/S 271 (1) (C) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) BY DELETING THE SAME . 2. BRIEF FACTS OF THE CASE ARE THAT THAT ASSESSEE FILED ITS E - RETURN OF INCOME FOR THE A.Y 20 09 - 10 ON 28 .09.20 09 , DECLARING TOTAL INCOME OF RS. 15,53,320/ - WHICH WAS PROCESSED/ ACCEPTED U/S 143(1) OF THE ACT. SUBSEQUENTLY INFORMATION RECEIVED FROM SALES TAX DEPARTMENT AND INVESTIGATIO N WING , MUMBAI INFORMING THAT ASSESSEE HAS MADE PURCHASES FROM HAWALA ENTRY PROVIDERS. ACCORDINGLY , THE ASSESSMENT WAS REOPENED , THE REASSESSMENT WAS COMPLETED VIDE ORDER DATED 20.03.2015 BY DETERMINING THE TOTAL INCOME AT RS. 77,01,333/ - . IN THE ABOVE ASSESSMENT A.O ESTIMATED THE COMMISSION @ 1% ON SALES MADE BY THE ASSESSEE AND MADE ADDITION OF RS. 61,30,375 / - ON ACCOUNT OF BOGUS PURCHASE TRANSACTION U/S.69C OF THE ACT. IN THE RE - ASSESSMENT THE AO ALSO MADE DISALLOWANCE OF RS. 17,638/ - ON ACCOUNT OF CL AIM OF DEPRECIATION. ON SUSTENANCE/RESTRICTION OF ADDITION BY THE LD. CIT(A), T HE A.O ALSO INITIATED PENALTY PROCEEDINGS U/S 271(C) OF THE ACT BY ISSUE NOTICE U/S 274 OF THE ACT AND LEVIED PENALTY OF RS. 2,13,710/ - U/S. 271(1) ( C) OF THE ACT VIDE ORDER DA TED 2 7.03.2017 . ITA NO. 5725/MUM/2018 A.Y 2009 - 10 M/S. UNITD ASPHALTERS P.LTD . - 3 - 3. AGGRIEVED WITH THE ORDER OF THE A.O THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). 4. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND BY RELYING ON THE DECISION S OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF ITO VS. ETCO TELECOM LTD., IN ITA NO. 5243, 5998 & 5999/MUM/2012 AND IN THE CASE OF ACIT VS. M/S BALAJI CONSTRUCTIONS IN ITA NO. 217/MUM/2015 AND ITA NOS. 5531, 5532/MUM/2018 IN THE CASE OF ITO VS. SMT. SEEMAN R. SINGH, ORDER DT. 10 - 12 - 2019 LD. CIT(A) HAS DELETED T HE PENALTY LEVIED BY THE A.O. AGGRIEVED WITH THE ABOVE ORDER THE REVENUE IS IN APPEAL BEFORE US. 5. AT THE TIME OF HEARING, IT IS BROUGHT TO OUR NOTICE THAT THE PENALTY WAS LEVIED ON THE ALLEGE D BOGUS PURCHASES AND THE INCOME WAS ESTIMATED , THE SAME WAS A LSO CONFIRMED BY THE LD. DR. THEREFORE, IN OUR CONSIDERED VIEW AND IN THE CATENA OF CASES THE COURTS HAVE HELD THAT THE PENALTY CANNOT BE LEVIED WHEN THE INCOME OF THE ASSESSEE IS ESTIMATED. THEREFORE, THE PENALTY DELETED BY THE CIT(A) IS JUSTIFIED AND P ROPER. ACCORDINGLY THE APPEAL OF THE REVENUE IS DISMISSED. 6. IN THE RESULT THE APPEAL FILED BY THE REVENUE IS DISMISSED. ITA NO. 5725/MUM/2018 A.Y 2009 - 10 M/S. UNITD ASPHALTERS P.LTD . - 4 - THIS ORDER PRONOUNCED IN OPEN COURT ON 18 /12 /201 9 . SD/ - SD/ - ( PAWAN SINGH ) ( S RIFAUR RAHMAN ) (JUDICIAL MEMBER) ACCOUNTANT MEMBER MUMBAI, DATED 18 /12 /20 1 9 **PP,S PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) 4. ( ) / CONCERNED CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// 1. / ( ASST. REGISTRAR) , / ITAT, MUMBAI 6. DATE