SHRI ANIS AHMED ABDUL RASHID SIDDIQUI , MUMBAI V. ITO - 26(1)(1), MUMBAI, MUMBAI

ITA 5907/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 6864 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 16-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAY PRATAP SINGH
• Keywords: Bogus purchase; Set aside
• Section: 271(1)(c)

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI SHRI SHAMIM YAHYA (AM) & SHRI PAVANKUMAR GADALE ( JM) I.T.A. NO. 5907/MUM/2019 (ASSESSMENT YEAR 2010-11) I.T.A. NO. 5908/MUM/2019 (ASSESSMENT YEAR 2011-12 ) ANIS AHMED ABDUL RASHID SIDDIQUI PROP. OF HIMALAYA TRADING CORPORATION, C/O. M/S. N.S. VIRANI & CO., H-17, EVEREST BUILDING 9 TH FLOOR, OPP. TARDEO BUS DEPOT, MUMBAI-400034. PAN : AACPS5488E VS. ITO-26(1)(1)(1) BANDRA KURLA COMPLEX BANDRA- EAST MUMBAI- 400 051. (APPELLANT) (RESPONDENT) ASSESSEE BY NONE DEPARTMENT BY SHRI AJAY PRATAP SINGH DATE OF HEARING 31.03.2021 DATE OF PRONOUNCEMENT 06.04.2021 O R D E R PER SHAMIM YAHYA (AM) :- THESE ARE APPEALS BY THE ASSESSEE AGAINST THE RES PECTIVE ORDERS OF LEARNED CIT(A), WHEREIN FOLLOWING PENALTY LEVIED UN DER SECTION 271(1)(C) OF THE I.T. ACT HAS BEEN SUSTAINED :- ASSESSMENT YEAR AMOUNT OF PENALTY 2010-11 RS. 3,23,383/- 2011-12 RS. 1,100,322/- 2. BRIEF FACTS OF THE CASE LEADING TO THE LEVY OF P ENALTY ARE THAT THE ASSESSING OFFICER IN THESE CASES MADE DISALLOWANCE OF 15 % ON ACCOUNT OF BOGUS PURCHASES. HE REDUCED THE GROSS PROFIT ALREADY SHOW N IN THIS REGARD. ASSESSEE HAS SUPPLIED THE PURCHASE VOUCHERS AND THE PAYMENT WHERE SHOWN TO HAVE BEEN MADE BY BANKING CHANNEL. HOWEVER DRAWING ADVER SE INFERENCE FOR THE NONPRODUCTION OF THE SUPPLIERS THE ASSESSING OFFICE R MADE ESTIMATED DISALLOWANCE. HOWEVER THE ASSESSING OFFICER DID NOT DOUBT THE SALES. ANIS AHMED ABDUL RASHID SIDDIQUI 2 3. UPON THE AFORESAID ADDITIONS PENALTY UNDER SECTI ON 271(1)(C) OF THE ACT HAS BEEN LEVIED AND CONFIRMED BY LEARNED CIT(A). 4. AGAINST THE ABOVE ORDER ASSESSEE IS IN APPEALS B EFORE US. 5. WE HAVE HEARD LD DR AND PERUSED THE RECORDS. AS CLEAR FROM THE FACTS RECORDED ABOVE THE DISALLOWANCE HAS BEEN MADE ON AN ESTIMATED BASIS ON ACCOUNT OF THE NON-PRODUCTION OF SUPPLIERS BEFORE T HE ASSESSING OFFICER. THE PURCHASE VOUCHERS WERE DULY PRODUCED AND THE PAYMEN TS WERE THROUGH BANKING CHANNEL. IN THESE BACKGROUNDS IN OUR CONSID ERED OPINION ASSESSEE CANNOT BE VISITED WITH THE REGOURS OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. AS A MATTER OF FACT, ON MANY OCCASIONS ON SIMILAR C IRCUMSTANCES IN QUANTUM PROCEEDINGS THE DISALLOWANCE ITSELF HAS BEEN DELETE D. IN OUR CONSIDERED OPINION ON THE FACTS AND CIRCUMSTANCES OF THE CASE ASSESSEE CANNOT BE SAID TO HAVE BEEN GUILTY OF CONCEALMENT OR FURNISHING OF INACCUR ATE PARTICULARS OF INCOME. IN THIS REGARD WE DRAW SUPPORT FROM THE DECISION OF A LARGER BENCH OF THE HONOURABLE SUPREME COURT HONOURABLE SUPREME COURT I N THE CASE OF HINDUSTAN STEEL LTD. VS. STATE OF ORISSA (83 ITR 26 ), WHERE IN IT WAS HELD THAT THE AUTHORITY MAY NO T LEVY THE PENALTY IF THE COND UCT OF THE ASSESSEE IS NOT FOUND TO BE CONTUMACIOUS. 6. IN THE BACKGROUND OF THE AFORESAID DISCUSSION AN D PRECEDENT, WE SET ASIDE THE ORDERS OF LEARNED CIT(A) AND DELETE THE L EVY OF PENALTY. 7. IN THE RESULT, BOTH THE APPEALS BY THE ASSESSEE ARE ALLOWED. PRONOUNCED IN THE OPEN COURT ON 6.4.2021. SD/- SD/- (PAVANKUMAR GADALE) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTAN T MEMBER MUMBAI; DATED : 06/04/2021 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT ANIS AHMED ABDUL RASHID SIDDIQUI 3 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR) PS ITAT, MUMBAI