I.T.O. - 31(2)(1), Mumbai V. SHRI JITENDRA S. MAMANIA, Mumbai

ITA 6009/MUM/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0860 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 22-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JYOTHILAKSHMI NAYAK
• Assessee Lawyers: LAJARI K OSWAL
• Keywords: Gift; Corroborative evidences
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI N.K. PRADHAN , ACCOUNTANT MEMBER ITA NO. 6009 / MUM ./201 8 ( ASSESSMENT YEAR : 20 10 11 ) INCOME TAX OFFICER WARD 31(2)(1), MUMBAI . APPELLANT V/S SHRI JITENDRA S. MAMANIA 1309 A, AGARWAL INDUSTRIES S.V. ROAD, JOGESHWARI (WEST) MUMBAI 400 102 PAN : ADDPM0623P . RESPONDENT C.O. NO.232/MUM./2019 ( ARISING OUT OF ITA NO.6009/MUM./2018 ) ( ASSESSMENT YEAR : 2010 11 ) INCOME TAX OFFICER WARD 31(2)(1), MUMBAI . APPELLANT V/S SHRI JITENDRA S. MAMANIA 1309 A, AGARWAL INDUSTRIES S.V. ROAD, JOGESHWARI (WEST) MUMBAI 400 102 PAN : ADDPM0623P . RESPONDENT ASSESSEE BY : MS. LAJARI K. OSWAL REVENUE BY : SMT. JYOTHI LAKSHMI NAYAK DATE OF HEARING 26 . 11 .2019 DATE OF ORDER 19.12.2019 2 SHRI JITENDRA S. MAMANIA O R D E R PER SAKTIJIT DEY, J.M. THE AFORESAID APPEAL BY THE REVENUE AND CROSS OBJECTION BY THE ASSESSEE ARE AGAINST THE ORDER DATED 12 TH JULY 2018, PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 42 , MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 20 10 11 . 2. T HE ONLY COMMON DISPUTE IN THE APPEAL AND THE CROSS OBJECTION IS WITH REGARD TO THE PART DISALLOWANCE SUSTAINED BY LEARNED COMMISSIONER (APPEALS). 3. BRIEF FACTS ARE, THE ASSESSEE , AN INDIVIDUAL , IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF GIFT ARTICLES THROUGH HIS PROPRIETORSHIP CONCERN ROUNDLINE INDUSTRIES. FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, THE ASSESSEE FILED HIS RETURN OF INCOME ON 22 ND SEPTEMBE R 2010 DECLARING TOTAL INCOME OF ` 10,76,820. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER , TO VERIFY THE GENUINENESS OF PURCHASES SHOWN BY THE ASSESSEE , ISSUED NOTICE S UNDER SECTION 133(6) OF THE ACT TO SELECTED PARTIES FROM WHOM THE ASSESSEE CLAIMED TO HAVE MADE PURCHASES. ON THE BASIS OF SUCH ENQUIRY, HE FOUND THAT PURCHASES WORTH ` 11,01,170, CLAIMED TO HAVE BEEN MADE FROM THREE PARTIES ARE DOUBTFUL AS THE CONCERNED SELLING DEALERS APPEARED IN THE LIST OF SUSPICIOUS DEALERS ISSUED BY THE SALES TAX 3 SHRI JITENDRA S. MAMANIA DEPARTMENT. ACCORDING TO THE INFORMATION RECEIVED, THESE ENTITIES WERE ONLY PROVIDING FALSE BILLS WITHOUT ACTUAL SALE TRANS ACTION. THUS, HE CALLED UPON THE ASSESSEE TO PROVE THE GENUINENESS OF PURCHASES. AS OBSERVED BY THE ASSESSING OFFICER, THE ASSESSEE WAS UNABLE TO FURNISH ANY CLINCHING EVIDENCE TO FULLY PROVE THE GENUINENESS OF PURCHASES MADE FROM THESE PARTIES. ACCORDINGL Y, HE TREATED THE PURCHASES WORTH ` 11,01,170, AS NON GENUINE AND ADDED BACK TO THE INCOME OF THE ASSESSEE. WHILE DECIDING ASSESSEES APPEAL DISPUTING SUCH ADDITION, LEARNED COMMISSIONER (APPEALS) RESTRICTED THE ADDITION TO 25% OF THE NON GENUINE PURCHASES . 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED , SINCE THE ASSESSEE HAS FAILED TO PROVE THE PURCHASES THROUGH PROPER SUPPORTING EVIDENCES, 100% ADDITION MADE BY THE ASSESSING OFFICER WAS JUSTIFIED. 5. O N THE OTHER HAND , LEARNED AUTHORISED REPRESENTATIV E SUBMITTED , WHILE DECIDING IDENTICAL ISSUE IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2009 10, THE TRIBUNAL HAS RESTRICTED THE ADDITION TO 12.5% OF THE NON GENUINE PURCHASES. THUS, S HE SUBMITTED , THE DISALLOWANCE SHOULD BE RESTRICTED TO 12.5%. 6. WE HAV E CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. NO DOUBT, THE ASSESSEE WAS UNABLE TO PROVE THE SOURCE OF PURCHASES MADE THROUGH PROPER DOCUMENTARY EVIDENCES. HOWEVER, THE 4 SHRI JITENDRA S. MAMANIA SALES EFFECTED BY THE ASSESSEE HAVE NOT BEEN DOUBTED. THEREFORE, L EARNED COMMISSIONER (APPEALS) WAS JUSTIFIED IN INTERFERING WITH 100% ADDITION MADE BY THE ASSESSING OFFICER. HOWEVER, THE DISALLOWANCE ON ACCOUNT OF NON GENUINE PURCHASES @ 25% BY LEARNED COMMISSIONER (APPEALS) IS ON A MUCH HIGHER SIDE. NOTABLY, WHILE DECI DING IDENTICAL NATURE OF DISPUTE IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2009 10 IN ITA NO.1380/MUM./2018, DATED 4 TH OCTOBER 2019, THE TRIBUNAL HAS RESTRICTED THE ADDITION TO 12.5% OF THE NON GENUINE PURCHASES. FACTS BEING SIMILAR, R ESPECTFULLY FOLL OWING THE AFORESAID DECISION OF THE CO ORDINATE BENCH, WE RESTRICT THE ADDITION TO 12.5% OF THE NON GENUINE PURCHASES. 7. IN THE RESULT, REVENUES APPEAL IS DISMISSED AND ASSESSEES CROSS OBJECTION IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 19.12.2019 SD/ - N.K.PRADHAN ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 19.12.2019 5 SHRI JITENDRA S. MAMANIA COPY OF THE ORDER FORWARDED TO : (1) THE ASSESSEE; (2) THE REVENUE; (3) THE CIT(A); (4) THE CIT, MUMBAI CITY CONCERNED; (5) THE DR, ITAT, MUMBAI; (6) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY ASSISTANT REGISTRAR ITAT, MUMBAI