ITO-28(3)(5), MUMBAI, MUMBAI V. SHRI. TARKESHWARNATH ANGADPRASAD GUPTA, MUMBAI

ITA 5741/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6813 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2009-2010
• Appeal Filed On: 06-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR MENON
• Keywords: Bogus purchase
• Section: 271(1)(c); 143(3); 274; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.5741/M/2019 ASSESSMENT YEAR: 2009-10 INCOME TAX OFFICER- 28(3)(5), ROOM NO.323, 3 RD FLOOR, 6 TH TOWER, VASHI RAILWAY STATION COMPLEX, VASHI, MUMBAI - 400703 VS. SHRI TARKESHWARNATH ANGADPRASAD GUPTA, JANTA MARKET, PLOT NO.19, SECTOR-23, TURBHE, NAVI MUMBAI, MUMBAI - 400705 PAN: AFEPG6394J (APPELLANT) (RE SPONDENT) PRESENT FOR: ASSESSEE BY : NONE REVENUE BY : SHRI VIJAY KUMAR MENON, D.R. DATE OF HEARING : 23.06.2021 DATE OF PRONOUNCEMENT : 23.06.2021 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVEN UE AGAINST THE ORDER DATED 12.06.2019 OF THE COMMISSIO NER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS TH E CIT(A)] RELEVANT TO ASSESSMENT YEAR 2009-10. 2. AT THE TIME OF HEARING WHEN THE CASE WAS CALLED FOR HEARING NEITHER ASSESSEE NOR HIS AUTHORISED REPRESENTATIVE WAS PRESENT TO ATTEND THE HEARING NOR ANY APPLICATION FOR ADJOU RNMENT WAS FILED. THEREFORE, WE ARE DECIDING THE ISSUE AFTER HEARING THE LD. D.R. ITA NO.5741/M/2019 SHRI TARKESHWARNATH ANGADPRASAD GUPTA 2 3. THE ONLY ISSUE CHALLENGED BY THE REVENUE IS CONF IRMATION OF PENALTY OF RS.32,280/- BY LD. CIT(A) AS LEVIED B Y THE AO UNDER SECTION 271(1)(C) OF THE ACT READ WITH SECTIO N 274 OF THE ACT. 4. THE FACTS IN BRIEF ARE THAT THE ASSESSMENT WAS F RAMED UNDER SECTION 143(3) READ WITH SECTION 147 OF THE A CT AT A TOTAL INCOME OF RS.10,29,930/- AS AGAINST THE RETURNED IN COME OF RS.3,12,540/- VIDE ORDER DATED 17.03.2015. THE ASS ESSEE IS ENGAGED IN THE BUSINESS OF TIMBER TRADING AND SUPPL YING OF HARDWARE ITEMS. THE CASE OF THE ASSESSEE WAS REOPE NED AFTER THE AO RECEIVED INFORMATION FROM DGIT(INV.) AND ALS O FROM SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA THAT ASSE SSEE HAS MADE BOGUS HAWALA PURCHASES FROM TWO PARTIES NAMELY SHEETAL TRADING CO. FOR RS.3,52,977/- AND PAYAL ENTERPRISES FOR RS.3,64,417/- AGGREGATING TO RS.7,17,394/-. THE AO TREATED THESE ALLEGED BOGUS PURCHASES AS NON GENUINE AND AD DED THE ENTIRE AMOUNT TO THE INCOME OF THE ASSESSEE IN THE ASSESSMENT FRAMED AS STATED HEREINABOVE WHEREAS THE LD. CIT(A) PARTLY ALLOWED THE APPEAL OF THE ASSESSEE BY SUSTAINING TH E ADDITION TO THE EXTENT OF 15% OF THE BOGUS PURCHASES . THEREAF TER THE AO LEVIED PENALTY EQUAL TO 100% OF THE TAX SOUGHT TO B E EVADED VIDE ORDER DATED 28.03.2018 PASSED UNDER SECTION 271(1)( C) OF THE ACT. 5. IN THE APPELLATE PROCEEDINGS, THE LD. CIT(A) AL LOWED THE APPEAL OF THE ASSESSEE BY HOLDING AND OBSERVING AS UNDER: 6.4 ON THE SIMILAR SET OF FACTS, THE HON'BLE ITAT , MUMBAI HAS DELETED PENALTY U/S. 271(1)(C) OF THE ACT IN ITA NO. 5586/MUM/2015 DATED 16.01 2017 IN THE CASE OF DCIT CIR 4(2)(2) VS. M/S. MANOHAR MANAK ALLOYS P. LTD. ON THE SAME LINES, THE HON'BLE ITAT, MUMBAI IN ITA NO. 7519/MUM/2013 DATED 08.07.2015 IN THE CASE OF M/S. YASHRAJ FILMS P. LTD. VS. THE A.C.I. T.CENTRAL CIRC LE 29, MUMBAI HAS DELETED THE ITA NO.5741/M/2019 SHRI TARKESHWARNATH ANGADPRASAD GUPTA 3 PENALTY U/S. 271(1)(C) OF THE ACT. LEVIED ON ADDITI ON MADE ON ESTIMATION BASIS. LIKEWISE, THE HON'BLE ITAT, MUMBAI IN ITA NO. 93/MUM/2011 DATED 10.04.2015 IN THE CASE OF DCIT 14(2) VS. M/S. RISHABH LMPEX GULABDAS & CO. DELETED THE PENALTY U/S. 271(1)(C) OF THE A. LEVIED ON ADDITION MADE ON ESTI MATION BASIS. FURTHER, IN A RECENT DECISION OF DELHI ITAT IN THE CASE OF SHRUTI FASTNERS LTD. VS. DCIT (2017) 49 CCH 0183 DEL TRIB AND ITAT MUMBAI IN THE CASE OF RAKESHKUROR M. GUPTA VS.LTO(2017) 49 CCH 0066 MUMTRIB, IT HAS BEEN MELD THAT WHERE INCOME HAS BEEN ESTIMATED, THE APPELLANT CANNOT BE SAID TO HAVE CONCEALED PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOM E AND THEREFORE, PENALTY U/S 271(1)(C) WAS NOT LEVIABLE. 6.5 IN THE BACKGROUND OF THE AFORESAID DISCUSSIONS AND RESPECTFULLY FOLLOWING THE PRECEDENTS, AS ABOVE AND THOSE RELIED UPON BY THE A PPELLANT, I AM OF THE CONSIDERED VIEW THAT THE APPELLANT HAS NOT CONCEALE D THE PARTICULARS OF INCOME AND NOR HAS IT FURNISHED INACCURATE PARTICULARS OF INCO ME, THERE BEING ARE NO FINDINGS OF THE AO THAT THE DETAILS FURNISHED BY THE APPELLANT IN HIS RETURN ARE FOUND TO BE INACCURATE OR ERRONEOUS OR FALSE. ACCORDINGLY, I DE LETE THE PENALTY OF RS. 32,2807- LEVIED BY THE AO U/S 271(1)(C) OF THE ACT AND THE G ROUNDS OF APPEAL ARE ' ALLOWED'. 6. AFTER HEARING THE LD. D.R. AND PERUSING THE MATE RIAL ON RECORD, WE OBSERVE THAT THE LD. CIT(A) HAS GIVEN A FINDING THAT NO PENALTY IS LEVIABLE WHERE THE ADDITION IS MADE O N ESTIMATION BASIS AND RELIED ON SEVERAL DECISIONS AS MENTIONED HEREINABOVE. ACCORDINGLY, WE ARE INCLINED TO UPHOLD THE ORDER OF LD. CIT(A) BY DISMISSING THE APPEAL OF THE REVENUE. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 23.06.2021. SD/- SD/- (SAKTIJIT DEY) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 23.06.2021. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI ITA NO.5741/M/2019 SHRI TARKESHWARNATH ANGADPRASAD GUPTA 4 THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY /ASSTT. REGISTRAR, ITAT, MUMBAI.