DCIT 15(2)(2), MUMBAI V. INDOCEN ELECTRONIC SYSTEM P.LTD, NAVI MUMBAI

ITA 6134/MUM/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4268 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 26-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASHOK PURI
• Keywords: Bogus purchase; Accommodation entries; Reassessment proceedings
• Section: 143(3); 13; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH C, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO. 6134/MUM/2018 : A.Y : 2010 - 11 DCIT 15(2)(2), MUMBAI. (APPELLANT) VS. M/S. INDOCEN ELECTRONIC SYSTEM PRIVATE LIMITED, 403 - 409, A - WING, GREAT EASTERN SUMMIT, PLOT NO. 56, SECTOR - 15, CBD BELAPUR, NAVI MUMBAI 400 614. PAN : AAACI3124N (RESPONDENT) APP ELLANT BY : SHRI UODAL RAJ SINGH RESPONDENT BY : SHRI A SHOK PURI DATE OF HEARING : 13 /10/2020 DATE OF PRONOUNCEMENT : 13 /10/2020 O R D E R PER SHRI VIKAS AWASTHY , JM : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX - 24, MUMBAI (IN SHORT THE CIT(A)) DATED 19.07.2018. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM THE RECORDS ARE : T HE ASSESSEE IS ENGAGED IN THE BUSINESS OF REPAIR OF PCB AND HIGH - TECH ELECTRONIC AND COMMUNICATION EQUIPMENT S . REASSESSMENT PROCEEDINGS WERE INITIATED AGAINST THE ASSESSEE UNDER SECTION 147 R.W.S. 148 OF THE INCOME TAX ACT, 1961 2 ITA NO. 6134/MUM/2018 M/S. INDOCEN ELECTRONIC SYSTEM PVT. LTD. (HEREINAFTER REFERRED TO AS THE ACT) ON THE BASIS OF INFORMATION RECEIVED FROM MAHARASHTRA SALES TAX DEPARTMENT. AS PER THE INFORMATION RECEIVED, THE ASSESSEE HAD OBTAINED BOGUS PURCHASE BILLS TO THE TUNE OF RS.37, 99,718/ - FROM THE FOLLOWING HAWALA DEALERS : - I) R.K. ENTERPRISE - RS.18,53,696 II) RUMGGT ENTERPRISES - RS. 6,50,104 III) GRIFTON INDIA RIDDHI ENTERPRISES - RS.12,95,918 TOTAL RS.37,99,718 THE ASSESSING OFFICER MADE ADDITION OF THE ENTIRE ALLEGED BOGUS PURCHASE. AGGRIEVED AGAINST THE ASSESSMENT ORDER DATED 20.12.2017 PASSED UNDER SECTION 143(3) R.W.S. 147 OF THE ACT, THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A), FOLLOWING ITS O WN ORDER IN ASSESSMENT YEAR 2009 - 10, RESTRICTED THE DISALLOWANCE ON ACCOUNT OF BOGUS PURCHASE TO 12.5%. AGAINST THE FINDINGS OF CIT(A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 3 . SHRI UODAL RAJ SINGH REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE ASSESSMENT ORDER AND PRAYED FOR MODIFYING THE FINDINGS OF CIT(A) TO MAKE 100% DISALLOWANCE IN RESPECT OF BOGUS PURCHASE. THE LD. DR SUBMITTED THAT THE CIT(A) MERELY FOLLOWED ITS OWN ORDER OF ASSESSMENT YEAR 2009 - 10 WITHOUT EXAMINING THE FACTS IN THE I MPUGNED ASSESSMENT YEAR. 4. ON THE OTHER HAND, SHRI ASHOK PURI APPEARING ON BEHALF OF THE ASSESSEE VEHEMENTLY SUPPORTED THE ORDER OF CIT(A). THE LD. AR SUBMITTED THAT THE FACTS IN IMPUGNED ASSESSMENT YEAR ARE SIMILAR TO ASSESSMENT YEAR 2009 - 10. THE LD. AR PRAYED FOR DISMISSING THE APPEAL OF REVENUE. 3 ITA NO. 6134/MUM/2018 M/S. INDOCEN ELECTRONIC SYSTEM PVT. LTD. 5. WE HAVE HEARD THE SUBMISSIONS MADE BY RIVAL SIDES AND HAVE EXAMINED THE ORDERS OF THE AUTHORITIES BELOW. THE CASE OF REVENUE IS THAT ASSESSEE HA S INDULG ED IN OBTAINING ACCOMMODATION ENTRIES FROM HAWALA D EALERS WITHOUT ACTUAL PURCHASE OF GOODS. WE OBSERVE THAT THE CIT(A) IN THE IMPUGNED ORDER HAS SPECIFICALLY MENTIONED THAT THE ISSUE RAISED IN THE PRESENT APPEAL IS SIMILAR TO THE ONE DECIDED IN ASSESSMENT YEAR 2009 - 10. IN THE IMMEDIATELY PRECEDING ASSESS MENT YEAR, CIT(A) HAD RESTRICTED THE DISALLOWANCE IN RESPECT OF BOGUS PURCHASES TO 12.5%. FOLLOWING THE SAME CRITERIA, CIT(A) RESTRICTED THE DISALLOWANCE ON ACCOUNT OF BOGUS PURCHASE IN THE IMPUGNED ASSESSMENT YEAR TO 12.5%. THE LD. DR HAS NOT BEEN ABLE TO DISTIN GUISH THE FACTS IN TWO ASSESSMENT YEARS. WE FIND NO INFIRMITY IN THE IMPUGNED ORDER. ACCORDINGLY, THE SAME IS UPHELD AND THE APPEAL OF REVENUE IS DISMISSED SANS MERIT. 6. NO CROSS APPEAL BY THE ASSESSEE AGAINST THE IMPUGNED ORDER OF CIT(A) HAS BEEN BROUGHT TO OUR NOTICE. IN CASE, THERE IS ANY CROS S APPEAL BY THE ASSESSEE, THEN, THE PRESENT ORDER MAY BE RECALLED AND BOTH THE APPEALS, I.E. APPEAL BY THE ASSESSEE AND APPEAL OF THE REVENUE HAVE TO BE DECIDED TOGETHER. 7. IN THE RESULT, APPEAL OF T HE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON TUESDAY, THE 13 TH OCTOBER, 2020. SD/ - SD/ - (RAJESH KUMAR) ACCOUNTANT MEMBER ( VIKAS AWASTHY ) JUDICIAL MEMBER MUMBAI, DATE : 13 TH OCTOBER, 20 20 *SSL* 4 ITA NO. 6134/MUM/2018 M/S. INDOCEN ELECTRONIC SYSTEM PVT. LTD. COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, C BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI