SUNIL GREAT (HYK) PROCESSORS P.LTD, BHIWANDI V. INCOME TAX OFFICER, WARD-1(4), KALYAN

ITA 5928/MUM/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7248 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 18-09-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N HEMALATHA
• Keywords: Bogus purchase
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, AM ITA NO. 5928 / MUM/20 17 ( ASSESSMENT YEAR : 2009 - 10 ) M/S. SUNIL GREAT (HYK) PROCESSORS PVT. LTD., 1 ST FLOOR, A - WING 504, GREEN PARK SOCIETY KOMBAD PADA, BHIWANDI 421 302 VS. ITO WARD 1(4), KALYAN (W) - 421 301 PAN/GIR NO. AAJCS1619M APPELLANT ) .. RESPONDENT ) ASSESSEE BY SHRI SANJAY PARIKH REVENUE BY MS. N. HEMALATHA DATE OF HEARING 25 / 04/ 201 8 DATE OF PRONOUNCEME NT 26 / 04 / 201 8 / O R D E R PER R.C.SHARMA (A.M) : THIS IS AN APPEAL FILED BY ASSESSEE AGAINST THE ORDER OF CIT(A) - 2, THANE DATED 31/07/2017 FOR A.Y.2009 - 10 IN THE MATTER OF ORDER PASSED U/S.143(3) R.W.S. 147 OF THE IT ACT. 2. IN THIS APPEAL, ASSESSEE IS AGGRIEVED BY THE ACTION OF CIT(A) FOR UPHOLDING ADDITION OF 42.15% OF THE ALLEGED BOGUS PURCHASES. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. 4. BRIEFLY STATED FACTS OF THE CASE ARE THAT IN THIS CASE THE RETURN OF INCOME, DECLARING TOTAL I NCOME AT RS 9,88,640/ - , WAS FILED ON 29/09/2009. SUBSEQUENTLY INFORMATION WAS RECEIVED FROM THE SALES TAX DEPARTMENT, THAT THE ASSESSEE WAS ONE OF THE BENEFICIARIES WHO HAD OBTAINED BOGUS ITA NO. 5928/MUM/2017 M/S. SUNIL GREAT (HYK) PROCESSORS PVT. LTD., 2 PURCHASE BILLS FROM THE ALLEGED HAWALA DEALERS. IN VIEW OF THE ABOVE INFORMATION THE CASE OF THE ASSESSEE WAS RE - OPENED, AFTER RECORDING NECESSARY REASONS/SATISFACTION, BY ISSUE OF NOTICE U/S!48 OF THE ACT. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS OF MANUFACTURING OF DRUGS AND PHARMACEUTICALS AND FERTILIZERS, CHEM ICALS AND PAINTS. THE AO FINALIZED THE ASSESSMENT ORDER U/S. 143(3) R.W.S. 147 OF THE ACT ON 27/02/2015, AT TOTAL INCOME OF RS.26,56,610/ - BY DISALLOWING RS.16,67,967/ - , ON ACCOUNT OF ALLEGED BOGUS PURCHASES. 5. BY THE IMPUGNED ORDER, CIT(A) CONFIRMED T HE ADDITION OF RS.7,03,110/ - WHICH WORKS OUT TO BE 42.15% OF ALLEGED BOGUS PURCHASES. ASSESSEE IS IN FURTHER APPEAL BEFORE US. 6. I HAVE CONSIDERED RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM RECORD THAT ON THE BASIS OF INFORMATION FROM SALES TAX DEPARTMENT, AO REOPENED THE ASSESSMENT AND ADDED THE ENTIRE AMOUNT OF SUCH ALLEGED BOGUS PURCHASES IN ASSESSEES INCOME. 7. BY THE IMPUGNED ORDER, CIT(A) RESTRICTED THE ADDITION TO RS.7,03,110/ - WHICH WORKS OUT T O BE 42.15% OF THE ALLEGED BOGUS PURCHASES. FROM THE RECORD I FOUND THAT CORRESPONDING SALES MADE BY ASSESSEE HAS NOT BEEN DENIED NOR USE OF THE MATERIAL SO PURCHASED DURING MANUFACTURING PROCESS WAS DECLINED. BOOKS OF ACCOUNTS WAS MAINTAINED BY THE ASSESS EE WERE ALSO NOT REJECTED . F OLLOWING THE PROPOSITION OF LAW LAID DOWN IN THE JUDICIAL PRONOUNCEMENTS FILED ON RECORD ITA NO. 5928/MUM/2017 M/S. SUNIL GREAT (HYK) PROCESSORS PVT. LTD., 3 BY THE AR, W E DIRECT TO RESTRICT THE ADDITION TO 12.5% OF THE ALLEGED BOGUS PURCHASES. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 26 / 04 /201 8 SD/ - ( R.C.SHARMA ) ACCOUNTANT MEMBER MUMBAI ; DATED 26 / 04 /201 8 KARUNA SR. PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE AP PELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//