OMPRAKASH AGRAWAL, MUMBAI V. INCOME TAX OFFICER 18(2)(4), MUMBAI

ITA 628/MUM/2018

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 0909 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 01-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SWA
• Keywords: Accommodation entries
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER ITA NO. 628 / MUM . /2018 ( ASSESSMENT YEAR : 20 1 1 1 2 ) OMPRAKASH AGARWAL 4 TH FLOOR, ROOM NO.71 12/2, KALBADEVI ROAD FANASWADI, MUMBAI PAN ADXPA4476G . APPELLANT V/S INCOME TAX OFFICER WARD 18(2)(4), MUMBAI . RESPONDENT ASSESSEE BY : NONE REVENUE BY : SHRI SWAPAN KUMAR BEPARI DATE OF HEARING 24 .0 9 .2018 DATE OF ORDER 05.10.2018 O R D E R A FORESAID APPEAL HA S BEEN FILED BY THE ASSESSEE CHALLENGING THE ORDER DATED 10 TH NOVEMBER 2017 , PASSED BY THE LEARNED COMMISSIONER (APPEALS) 29 , MUMBAI, FOR THE ASSESSMENT YEAR 20 1 1 1 2 . 2 . WHEN THE APPEAL WAS CALLED FOR HEARING, NONE WAS PRESENT ON BEHALF OF THE ASSESSEE IN SPITE OF SERVICE OF HEARING NOTICE ISSUED PER REGISTERED POST , WHICH IS EVIDENT FROM THE POSTAL ACKNOWLEDGMENT PLACED ON RECORD. THEREFORE, I PROCEED TO DISPOSE OFF THE APPEAL EX 2 OMPRAKASH AGARWAL PARTE QUA THE ASSESSEE AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE. 3 . BRIEF FACTS ARE, THE ASSESSEE, AN INDIVIDUAL , IS ENGAGED IN THE BUSINESS OF RESELLER AND BROKER OF IRON AND STEEL. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HIS RETURN OF INCOME ON 24 TH SEPTEMBER 2011, DECLARING LOSS OF ` 7,83,391. THE R ETURN OF INCOME FILED BY THE ASSESSEE WAS PROCESSED UNDER SECTION 143(1) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT). SUBSEQUENTLY, ON THE BASIS OF INFORMATION RECEIVED FROM THE SALES TAX DEPARTMENT THROUGH DGIT (INV.), MUMBAI, REVE A LING THAT PURCHASE OF GOODS WORTH OF ` 1,12,11,810 CLAIMED TO HAVE BEEN MADE FROM SAI INT ERNATIONAL IMPEX IS NOT GENUINE, T HE ASSESSING OFFICER RE OPENED THE ASSESSMENT UNDER SECTION 147 OF THE ACT. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER ON THE BAS IS OF INFORMATION AVAILABLE ON RECORD HAVING FOUND THAT THE SALES TAX DEPARTMENT HAS IDENTIFIED SAI INTERNATIONAL IMPEX , THE PARTY FROM WHOM THE ASSESSEE HAD SHOWN THE PURCHASES , IS A HAWALA OPERATOR PROVIDING ACCOMMODATION ENTRIES , CALLED UPON THE ASSESSE E TO PROVE THE GENUINENESS OF SUCH PURCHASES THROUGH PROPER DOCUMENTARY EVIDENCES. AS OBSERVED BY THE ASSESSING OFFICER, EXCEPT FURNISHING PURCHASE INVOICES AND BANK STATEMENT , THE ASSESSEE WAS UNABLE TO FURNISH ANY OTHER DOCUMENTARY EVIDENCES , INCLUDING D ELIVERY CHALLAN AND TRANSPORTATION BILLS , TO PROVE ACTUAL 3 OMPRAKASH AGARWAL DELIVERY OF GOODS. THUS, THE ASSESSING OFFICER REJECTED THE BOOKS OF ACCOUNT OF THE AS SESSEE AND TREATED THE PURCHASE OF GOODS WORTH ` 1,12,11,810 AS NON GENUINE. HOWEVER, HE RESTRICTED THE ADDITION ON ACCOUNT OF SUCH NON GENUINE PURCHASE BY ESTIMATING THE GROSS PROFIT @ 12.5% OF THE PURCHASE MADE , WHICH WORKED OUT TO ` 14,01,476. BEING AGGRIEVED OF THE AFORESAID ADDITION MADE BY THE ASSESSING OFFICER, THE ASSESSEE PREFERRED APPEAL BEFORE THE FIRST A PPELLATE AUTHORITY. HOWEVER, THE LEARNED COMMISSIONER (APPEALS) SUSTAINED THE ADDITION MADE BY THE ASSESSING OFFICER. 4 . I HAVE CONSIDERED THE SUBMISSIONS OF LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED MATERIALS ON RECORD. IT IS EVIDENT , NEITHER BEFORE THE ASSESSING OFFICER NOR BEFORE THE LEARNED COMMISSIONER (APPEALS) THE ASSESSEE COULD CONCLUSIVELY PROVE THE GENUINENESS OF PURCHASES MADE OF ` 1,12,11,810 BY FURNISHING PROPER DOCUMENTARY EVIDENCE. NO DELIVERY CHALLAN N OR TRANSPORTATION B ILL WAS FURNISHED TO PROVE ACTUAL DELIVERY OF GOODS . T HE ASSESSEE WAS UN ABLE TO PRODUCE THE CONCERNED PARTY OR EVEN ANY CONFIRMATION FROM THE SELLER IN SUPPORT OF PURCHASE MADE. IN THE AFORESAID VIEW OF THE MATTER, ADDITION MADE @ 12.5% OF THE NON GENUINE PURCHASES , IN MY VIEW , IS REASONABLE, HENCE, DESERVES TO BE UPHELD. AS REGARDS THE VALIDITY OF RE OPENING OF ASSESSMENT UNDER SECTION 147 OF THE ACT, IT IS EVIDENT , AFTER PROCESSING OF RETURN OF INCOME FILED BY THE ASSESSEE THE 4 OMPRAKASH AGARWAL ASSESSING OFFICER RECEIVED S PECIFIC INFORMATION FROM THE SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA, INDICATING ESCAPEMENT OF INCOME ON ACCOUNT OF NON GENUINE PURCHASE MADE BY THE ASSESSEE. THAT BEING THE CASE, THE ASSESSING OFFICER WAS WITHIN HIS POWER TO EXERCISE JURISDICTION UNDER SECTION 147 OF THE ACT. IN VIEW OF THE AFORESAID, GROUNDS RAISED ARE DISMISSED. 5 . IN THE RESULT, ASSESSEES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 05.10.2018 SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 05.10.2018 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 (SR. PRIVATE SECRETARY) ITAT, MUMBAI