INCOME TAX OFFICER 32 (1) (2) , Mumbai V. C S SHARMA & COMPANY, Mumbai

ITA 5787/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0314 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 09-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Assessee Lawyers: M SUBRAMANIAN
• Keywords: Bogus purchase
• Section: 133(6)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 5787 //20 19 (. . 2009-10 ) ITA NO.5787/MUM/2019 (A.Y.2009-10) ITO-32(1)(2), ROOM NO. 704, 7 TH FLOOR, KAUTILYA BHAVAN, BKC, BANDRA (EAST), MUMBAI-400051. ...... ' / APPELLANT VS. C.S. SHARMA & CO. 503, 5 TH FLOOR, PRATIK PRASHANT CHS, HOLY CROSS ROAD, I.C. COLONY, BORIVALI (WEST), MUMBAI-400103. PAN: AACFC6510B . .... (*/ RESPONDENT ' +/ APPELLANT BY : MS. SMITA VERMA (* +/ RESPONDENT BY : SH. M. SUBRAMANIAN, ADVO CATE , / DATE OF HEARING : 06/04/2021 , / DATE OF PRONOUNCEMENT : 01/07/2021 / 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 2 . 5787 //20 19 (. .2009-10 ) ITA NO.5787/MUM/2019 (A.Y.2009-10) THE CIT(A)] DATED 21.05.2019 FOR THE ASSESSMENT Y EAR (AY) 2009-10. THE SOLITARY ISSUE RAISED BY THE REVENUE IN APPEAL IS A GAINST THE RELIEF GRANTED BY THE CIT(A) IN RESTRICTING ADDITION TO 12.5% ON ACCO UNT OF ALLEGED BOGUS PURCHASES. 2. SHRI M. SUBRAMANIAN APPEARING ON BEHALF OF THE A SSESSEE SUBMITTED THAT THE ASSESSEE IS A CIVIL CONTRACTOR AND IS PRIMARILY WORKING FOR MES. IN ASSESSMENT PROCEEDINGS, THE AO HELD THAT THE ASSESS EE HAS OBTAINED BOGUS PURCHASE BILLS AMOUNTING TO RS. 14,52,015/- FROM HA WALA DEALERS. THE ASSESSEE PRODUCED VARIOUS DOCUMENT VIZ. COPIES OF PURCHASE B ILLS, COPIES OF BANK STATEMENTS, ETC. TO PROVE GENUINENESS OF THE PURCHA SES. HOWEVER, THE AO MADE ADDITION OF THE ENTIRE ALLEGED BOGUS PURCHASES . THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE THE CIT(A). THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND THE ORDER OF CIT(A) IN SUCCEEDI NG AYS I.E AYS 2010-11 AND 2011-12 IN ASSESSEES OWN CASE RESTRICTED THE DISAL LOWANCE TO 12.5% OF ALLEGED BOGUS PURCHASES. THE LD. COUNSEL FOR THE ASSESSEE P RAYED FOR UPHOLDING THE IMPUGNED ORDER AND DISMISSING APPEAL OF THE REVENUE . 3. PER CONTRA, MS. SMITA VERMA REPRESENTING THE DEP ARTMENT VEHEMENTLY DEFENDED THE ASSESSMENT ORDER. THE LD. DR SUBMITTED THAT THE ASSESSEE COULD NEITHER PRODUCE THE DEALERS NOR ANY CONFIRMATIONS F ROM THE DEALERS, THE NOTICES ISSUED UNDER SECTION 133(6) TO THE DEALERS REMAINED UNSERVED. FURTHER, THE ASSESSEE FAILED TO PRODUCE RELEVANT DOCUMENTS V IZ. LORRY RECEIPTS, STOCK REGISTER, ETC. TO PROVE TRAIL OF GOODS. THUS, THE A SSESSEE FAILED TO DISCHARGE ITS ONUS IN PROVING GENUINENESS OF THE DEALERS AND THE PURCHASES. 3 . 5787 //20 19 (. .2009-10 ) ITA NO.5787/MUM/2019 (A.Y.2009-10) 4. BOTH SIDES HEARD, ORDERS OF THE AUTHORITIES BELO W EXAMINED. UNDISPUTEDLY, THE ASSESSEE FAILED TO SUBSTANTIATE A UTHENTICITY OF THE DEALERS AND THE PURCHASES MADE FROM THEM. AT THE SAME TIME, IT IS OBSERVED THAT THE AO HAS NOT DOUBTED THE SALES DECLARED BY THE ASSESS EE. WITHOUT PURCHASES, THE ASSESSEE WHO IS A CIVIL CONTRACTOR COULD NOT PE RFORM THE WORK ALLOTTED TO HIM. IN SUCH LIKE SUSPICIOUS TRANSACTIONS, ENTIRE B OGUS PURCHASES CANNOT BE ADDED. IT IS ONLY THE PROFIT ELEMENT EMBEDDED IN SU CH TRANSACTIONS THAT CAN BE TAXED. THE CIT(A) HAS ESTIMATED MARGIN OF 12.5% ON ALLEGED BOGUS PURCHASES, THE SAME APPEARS TO BE REASONABLE. I SEEN NO REASON TO INTERFERE WITH THE FINDINGS OF CIT(A) ON THIS ISSUE. ERGO, THE IMPUGNE D ORDER IS UPHELD AND APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THURSDAY , THE 01 ST DAY OF JULY, 2021. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, 1/ DATED: 01/07/2021 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