ITO-32(3)(1), MUMBAI, MUMBAI V. SHRI RAHUL M. PATEL, MUMBAI, MUMBAI

ITA 5771/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0318 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 06-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Keywords: Bogus purchase

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 5771 //20 19 (. . 2009-10 ) ITA NO.5771/MUM/2019 (A.Y.2009-10) ITO-32(3)(1), ROOM NO. 734, 7 TH FLOOR, KAUTILYA BHAVAN, BKC, BANDRA (E), MUMBAI-400051. ...... ' / APPELLANT VS. SHRI RAHUL M. PATEL, 1 ST FLOOR, MEHTA APARTMENTS, TULSI BAUG, BORIVALI (W), MUMBAI-400103. PAN: AACPP6284H . .... (*/ RESPONDENT ' +/ APPELLANT BY : MS. SMITA VERMA (* +/ RESPONDENT BY : NONE , / DATE OF HEARING : 06/04/2021 , / DATE OF PRONOUNCEMENT : 02/07/2021 / ORDER PER VIKAS AWASTHY, J.M: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-46, MUMBAI [HE REINAFTER REFERRED TO AS THE CIT(A)] DATED 21.05.2019 FOR THE ASSESSMENT Y EAR (AY) 2009-10. 2 . 5771 //20 19 (. .2009-10 ) ITA NO.5771/MUM/2019 (A.Y.2009-10) 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RE CORDS ARE: THE ASSESSEE IS ENGAGED IN MANUFACTURING OF KITCHENWARE AND STEE L PRODUCTS. ON THE BASIS OF INFORMATION RECEIVED FROM THE SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA, THE ASSESSMENT FOR AY 2009-10 IN THE C ASE OF ASSESSEE WAS RE- OPENED. AS PER INFORMATION RECEIVED, THE ASSESSEE H AD OBTAINED BOGUS PURCHASES BILLS AMOUNTING TO RS. 90,750/- FROM THRE E DEALERS, DECLARED AS HAWALA OPERATORS BY THE SALES TAX DEPARTMENT, GOVER NMENT OF MAHARASHTRA. THE ASSESSING OFFICER (AO) MADE ADDITION OF THE ENT IRE ALLEGED BOGUS PURCHASES. THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE THE CIT(A). THE CIT(A) AFTER CONSIDERING THE GROSS PROFIT (GP) DECL ARED BY THE ASSESSEE, ESCAPEMENT OF VALUE ADDED TAX (VAT) AND AVERAGE IND USTRY MARGIN RESTRICTED THE ADDITION TO 10.5% ON ALLEGED BOGUS PURCHASES. N OW, THE REVENUE IS IN APPEAL AGAINST THE RELIEF GRANTED BY THE CIT(A). 3. MS. SMITA VERMA REPRESENTING THE DEPARTMENT VEHE MENTLY DEFENDED THE ASSESSMENT ORDER. THE DEPARTMENTAL REPRESENTATI VE (DR) SUBMITTED THAT THE ASSESSEE HAS FAILED TO PRODUCE THE DEALERS OR C ONFIRMATIONS FROM THEM. THE ASSESSEE HAS NOT FURNISHED ANY DOCUMENT SUCH AS DELIVERY CHALLANS, LORRY RECEIPTS, STOCK REGISTER ETC. TO PROVE TRAIL OF GOO DS. THE LD. DR PRAYED FOR RESTORING THE ADDITION AS PER THE ASSESSMENT ORDER. 4. SUBMISSIONS MADE BY LD. DR HEARD, ORDERS OF THE AUTHORITIES BELOW EXAMINED. UNDISPUTEDLY, THE ASSESSEE FAILED TO DISC HARGE HIS ONUS IN PROVING AUTHENTICITY OF THE DEALERS AND THE PURCHASE MADE F ROM THEM. AT THE SAME TIME, IT IS OBSERVED THAT THE AO HAS NOT DISPUTED T HE SALES TURNOVER DECLARED BY THE ASSESSEE. WITHOUT PURCHASES, THERE CANNOT BE SALES, THEREFORE, IT IS ONLY 3 . 5771 //20 19 (. .2009-10 ) ITA NO.5771/MUM/2019 (A.Y.2009-10) THE PROFIT ELEMENT EMBEDDED IN SUCH LIKE TRANSACTIO NS THAT CAN BE BROUGHT TO TAX. (RE: PCIT VS. PARAMSHAKTI DISTRIBUTORS PVT. LT D. IN INCOME TAX APPEAL NO. 413 OF 2017 DECIDED ON 15.07.2019). THE CIT(A) AFTE R TAKING INTO CONSIDERATION ENTIRE FACTS HAS RESTRICTED THE ADDITION ON BOGUS P URCHASES TO 10.5%. I SEE NO INFIRMITY IN THE IMPUGNED ORDER, THEREFORE, THE SAM E IS UPHELD AND APPEAL OF THE REVENUE IS DISMISSED, SANS MERIT. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY , THE 02 ND DAY OF JULY, 2021. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, 1/ DATED: 02/07/2021 SK, PS ( 2 ( 2 ( 2 ( 2 COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT , 2. (* / THE RESPONDENT. 3. 3 ( )/ THE CIT(A)- 4. 3 CIT 5. ( , . . . , / DR, ITAT, MUMBAI 6. 7 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI