V & V PHARMA INDUSTRIES, THANE V. ACIT CIR. 3, THANE, THANE

ITA 6055/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0896 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2017
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 10-10-2016
• Court: TRIBUNAL
• Department Lawyers: MRS BEENA SANTOSH
• Assessee Lawyers: DEEPAK RAJE
• Keywords: Bogus purchase
• Section: 69C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER ITA NO.6055/M/2016 (AY 2009 - 2010) V & V PHARMA INDUSTRIES, 73, SANSKRUTI PRASAD, RAM MARUTI ROAD, THANE (W), 400 602. / VS. ACIT, CIRCLE - 3, THANE. ./ PAN : AADFV 7814 L ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI DEEPAK RAJE / RESPONDENT BY : MRS. BEENA SANTOSH, DR / DATE OF HEARING : 11.04.2017 / DATE OF PRONOUNCEMENT : 26 .04.2017 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 10.10.2016 IS AGAINST THE ORDER OF THE CIT (A) - 2, THANE DATED 14.07.2016 FOR THE ASSESSMENT YEAR 2009 - 2010. 2. IN THIS APPEAL, ASSESSEE RAISED SEVEN GROUNDS IN TOTO. THE SOLITARY AND CORE ISSUE RAISED IN THE APPEAL RELATES TO THE CORRECTNESS OF THE ADDITION ON ACCOUNT OF BOGUS PURCHASES AMOUNTING TO RS. 1,930/ - . AO AND THE CIT (A) MADE THE ENTIRE BOGUS PURCHASES OF RS. 1,930/ - AS ADDITION U/S 69C OF THE ACT. 3. DURING THE PROCEEDINGS BEFORE THE TRIBUNAL, WITHOUT GOING TO THE OTHER ASPECTS, LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT RESTRICTING THE DISALLOWANCE TO GP RATE OF 12.50% OF RS. 1,930/ - WILL MEET THE E NDS OF JUSTICE. LD AR ALSO SUBMITTED THAT SIMILAR ADDITIONS ARE MADE IN SUBSEQUENT YEARS WITHOUT RESTRICTING THE ADDITION TO GP RATE OF 12.50%. 4. ON HEARING BOTH PARTIES, I AM OF THE OPINION THAT MAKING THE ENTIRE BOGUS PURCHASES AS ADDITION U/S 69C IS N O LONGER SUSTAINABLE IN LAW CONSIDERING THE THE BOMBAY HIGH COURT JUDGMENT IN THE CASE OF NIKUNJ EXIMP ENTERPRIES P LTD (372 ITR 619) (BOM) AND GUJRATH HIGH COURT JUDGMENT IN THE CASE OF CIT VS. SIMIT P SHETH 2 [2013] (356 ITR 451) (GUJ.) WHEREIN RESTRICTIN G THE ADDITION TO GP RATE OF 12.50% IS APPROVED. ACCORDINGLY I ORDER AND DIRECT THE ASSESSING OFFICER TO RESTRICT THE DISALLOWANCE TO ONLY 12.50% OF THE SUM OF RS. 1,930/ - . ACCORDINGLY, GROUNDS RAISED BY THE ASSESSEE ARE PARTLY ALLOWED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOU NCED IN THE OPEN COURT ON 2 6 T H APRIL, 2017. S D / - (D. KARUNAKARA RAO) ACCOUNTANT MEMBER MUMBAI ; 26.04.2017 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI