ACIT -19(2), MUMBAI , MUMBAI V. MAYURENDRA GORAKSHNATH BHIWANDKAR, MUMBAI , MUMBAI

ITA 6173/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6370 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 30-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Keywords: Bogus purchase; Depreciation
• Section: 143(3); 143(1); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH SMC, MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.6173/M/2019 ASSESSMENT YEAR: 2011-12 ACIT-19(2), ROOM NO.207, 2 ND FLOOR, MATRU MANDIR TARDEO ROAD, MUMBAI 400 007 VS. SHRI MAYURENDRA GORAKSHNATH BHIWANDKAR, FLAT NO.B-28, SHREE RAM INDUSTRIAL ESTATE, G.D. AMBEDKAR MARG, MUMBAI 400 031 PAN: AAIPB8866F (APPELLANT) (RE SPONDENT) PRESENT FOR: ASSESSEE BY : NONE REVENUE BY : MS. SMITA VERMA, D.R. DATE OF HEARING : 30.06.2021 DATE OF PRONOUNCEMENT : 08.07.2021 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENU E AGAINST THE ORDER DATED 10.07.2019 OF THE COMMISSIO NER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS TH E CIT(A)] RELEVANT TO ASSESSMENT YEAR 2011-12. 2. AT THE TIME OF HEARING WHEN THE CASE WAS CALLED FOR HEARING, NEITHER ASSESSEE NOR HIS AUTHORISED REPRESENTATIVE WAS PRESENT TO ATTEND THE HEARING NOR ANY APPLICATION FOR ADJOU RNMENT WAS FILED. THEREFORE, WE ARE DECIDING THE APPEAL OF TH E REVENUE AFTER HEARING THE LD. D.R. AND AFTER CONSIDERING THE MERI TS OF THE CASE. ITA NO.6173/M/2019 SHRI MAYURENDRA GORAKSHNATH BHIWANDKAR 2 3. THE ONLY ISSUE RAISED BY THE REVENUE IS AGAINST THE ORDER OF LD. CIT(A) DELETING THE ADDITION TO RS.1,22,500/- A S MADE BY THE AO ON ACCOUNT OF DEPRECIATION ON THE FICTITIOUS PUR CHASE OF PLANT & MACHINERY. 4. THE FACTS IN BRIEF ARE THAT THE ASSESSEE FILED T HE RETURN OF INCOME ON 28.08.2011 DECLARING TOTAL INCOME OF RS.2 8,02,800/- WHICH WAS PROCESSED UNDER SECTION 143(1) OF THE ACT . THE CASE OF THE ASSESSEE WAS THEREAFTER REOPENED BY THE AO A FTER RECEIPT OF INFORMATION FROM DGIT (INV.), MUMBAI THAT ASSESS EE IS BENEFICIARY OF HAWALA PURCHASE ENTRIES TO THE EXTEN T OF RS.7,97,484/- FROM TWO PARTIES NAMELY; SEJAL ENTERP RISES RS.9,984/- AND GALAXY CORPORATION RS.7,97,484/- AND ACCORDINGLY THE NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED ON 08.03.2016. THE AO CALLED FOR VARIOUS DETAILS A ND INFORMATION FROM THE ASSESSEE FROM TIME TO TIME DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS WHICH WERE DULY FI LED BEFORE THE AO. THE AO OBSERVED AFTER CONSIDERING THE SUBM ISSION OF THE ASSESSEE THAT ASSESSEE HAS MADE BOGUS PURCHASES OF RS.9,984/- WHICH WERE DEBITED IN THE PROFIT & LOSS ACCOUNT WHEREAS RS.7,00,000/- OF BOGUS PURCHASES WERE CAPIT ALIZED UNDER PLANT & MACHINERY AND CLAIMED DEPRECIATION OF RS.1,22,500/-. THE AO FINALLY REJECTED THE CONTENT IONS OF THE ASSESSEE AND TREATED THE PURCHASES AS NON GENUINE T HEREBY MAKING AN ADDITION OF BEING 25% OF THE BOGUS PURCHA SES OF RS.9,984/- WHICH COMES TO RS.2496/- AND ALSO DISALL OWING THE DEPRECIATION CLAIMED BY THE ASSESSEE OF RS.1,22,500 /- TO THE INCOME OF THE ASSESSEE BY FRAMING ASSESSMENT UNDER SECTION 143(3) READ WITH SECTION 147 OF THE ACT DATED 31.01 .2014. ITA NO.6173/M/2019 SHRI MAYURENDRA GORAKSHNATH BHIWANDKAR 3 5. IN THE APPELLATE PROCEEDINGS, THE LD. CIT(A) ALL OWED THE APPEAL OF THE ASSESSEE BY DIRECTING THE AO TO DELET E THE ADDITION. WHILE ALLOWING THE APPEAL OF THE ASSESSEE, THE LD CIT(A) RECORDED A FINDING THAT ASSESSEE HAS PRODUCED A CERTIFICATE FROM THE BANK BEFORE THE AO AND ALSO BEFORE THE LD CIT(A) AS THE PLANT AND MACHINERY WAS FINANCED BY THE BANK AND ALSO INSPECT ED. THE LD CIT(A) HAS NOTED THAT AO HAS NOT MADE FURTHER ENQUI RIES AND MERELY RELIED UPON THE INFORMATION RECEIVED FROM SA LES TAX DEPARTMENT. 6. AFTER HEARING THE LD. D.R. AND PERUSING THE MATE RIAL ON RECORD, WE OBSERVE THAT LD. CIT(A) HAS PASSED THE A PPELLATE ORDER AFTER RECORDING THAT AO HAS NOT CARRIED OUT A NY FURTHER ENQUIRES AND RELIED ON THE INFORMATION RECEIVED FRO M SALES TAX DEPTT. THE LD CIT(A) EVEN REFERRED TO THE BANK CERT IFICATE TESTIFYING THE FACT THAT THE PLANT WAS FINANCED BY THE BANK AND THE MACHINERY WAS ALSO INSPECTED. THUS THERE IS NO INFIRMITY IN THE ORDER OF LD CIT(A) AND WE ARE INCLINED TO UPHOL D THE SAME BY DISMISSING THE APPEAL OF THE REVENUE. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 08.07.2021. SD/- SD/- (SAKTIJIT DEY ) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 08.07.2021. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI ITA NO.6173/M/2019 SHRI MAYURENDRA GORAKSHNATH BHIWANDKAR 4 THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY /ASSTT. REGISTRAR, ITAT, MUMBAI.