ANIL JAGANNATH TIWARI PROPRIETOR M/S. ANIL AND BROTHERS, MUMBAI V. INCOME TAX OFFICER WARD 2(1), KALYAN

ITA 6492/MUM/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0503 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 06-11-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: N HEMALATHA
• Keywords: Unexplained cash credit
• Section: 143(3); 12; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC , MUMBAI BE F ORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD , JUDICIAL MEMBER ITA NO. 6492 /MUM/2017 (AY. 201 0 - 1 1 ) ITA NO. 6493/MUM/2017 (AY. 2011 - 12) SHRI ANIL JAGANNA TH TIWARI PROPRIETOR , M/S. ANIL AND BROTHERS C/O. KWALITY ENTERPRISES, LAXMI CHS LIMITED OPPOSITE MARUTI MANDIR, GANDHI CHOWK, KULGAON BADLAPUR (EAST), MUMBAI, MAHARASHTRA 421 503 PAN: ACGPT4287Q ...... APPELLANT VS. THE ITO WARD 2(1), KALYAN .... RESPONDENT A PP ELLANT BY : NONE RESPONDENT BY : MS. N. HEMALATHA DATE OF HEARING : 30/01/2018 DATE OF PRONOUNCEMENT : 31 / 01 /2018 O RDER PER G.S.PANNU,A.M: THE CAPTIONE D ARE TWO APPEALS FILED BY THE ASSESSEE FOR ASSESSMENT YEARS 2010 - 11 AND 2011 - 12 . S I NCE THE APPEALS RE LATE TO THE SAME ASSESSEE 2 ITA NO.6 492/MUM/2017 & 6499/ MUM/2017 SHRI ANIL JAGANNATH TIWARI AND INVOLVE CERTAIN COMMON ISSUES THEY HAVE BEEN CLUBBED AND HEARD TOGETHER AND A CONSOLIDATED ORDER IS BEING PASSED FOR THE SAKE OF CONVENIENCE AND BREVITY. 2. AT THE TIME OF HEARING IT WAS NOTICED THAT INSPITE OF ISSUANCE OF NOTICE BY RPAD, NONE HA S APPEARED BY THE ASSESSEE NOR ANY ADJOURNMENT APPLICATION WAS MOVED, THEREFORE, CONSIDERING THE RULE 25 OF THE APPELLATE TRIBUNAL RULES, 1963, THE APPEAL OF THE ASSESSEE IS BEING DISPOSED OFF EXPARTE QUA THE APPELLAN T AND AFTER HEARING RESPONDENT ON MERITS. 3 . ITA NO 6492 /M UM/2017 FOR ASSESSMENT YEAR 2010 - 11 IS TAKEN AS THE LEAD CASE SINCE THE ISSUES INVOLVED ARE SIMILAR . THIS APPEAL PERTAINING TO ASSE SSMENT YEAR 2010 - 11 IS DIRECTED AGAI NST AN ORDER PASSED BY CIT (A) - 3 , THANE DATED 05 / 0 7 /201 7 , WHICH IN TURN, ARISES OUT OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) . 4. IN THIS APPEAL, THE ONLY ISSUE RAISED IS WITH REGARD TO AN ADDITION OF RS.2 9,03,738/ - MADE BY THE ASSESSING OFFICER TREATING THE PURCHASES MADE BY THE ASSESSEE FROM CERTAIN PARTIES AS BOGUS. 5. BRIEFLY PUT THE RELEVANT FACTS ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING OF STEEL AND M.S. MATERIAL. IN THE COURSE OF A SSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT ASSESSEE HAS EFFECTED PURCHASES FROM FOUR PARTIES TOTALLING TO RS.29,03,738/ - WHO WERE DECLARED AS HAWALA DEALERS BY THE SALES TAX DEPARTMENT, MEANING THEREBY THE SAID PARTIES WERE MERELY ISSUING ACCOMMODATION BILLS AND NOT EFFECTING THE ACTUAL 3 ITA NO.6 492/MUM/2017 & 6499/ MUM/2017 SHRI ANIL JAGANNATH TIWARI PURCHASE / SALE OF GOODS. THE RELEVANT DISCUSSION IN THE ASSESSMENT ORDER ALSO REVEALS THAT THE ASSESSING OFFICER EXAMINED ASSESSEE U/S.131 OF THE ACT AND ALSO CARRIED OUT VERIFICATION EXERCISE WITH RESPECT TO THE FOUR PARTIES BY ISSUING NOTIC E S U/S.133(6) OF THE ACT. THE ASSESSING OFFICER NOTES THAT EITHER THE NOTICES WERE RETURNED BACK UNSERVED OR THE PARTIES DID NOT RESPOND TO THE NOTICE ISSUED U/S.133(6) OF THE ACT. CONSIDERING THE RESULT OF VERIFICATION EXERCISE AS WELL AS MATERIAL FURNISHED BY THE ASSESSEE, THE ASSESSING OFFICER WAS NOT SATISFIED THAT ANY GOODS WERE PURCHASED BY THE ASSESSEE IN ACTUALITY FROM SUCH FOUR PARTIES AND THEREFORE, TREATED THE PURCHASES OF RS.29,03,738/ - AS UNEXPLAINED AND ADDED THE SAME TO THE RETURN ED INCOME U/S.69C OF THE IT ACT. THE CIT(A) HAS ALSO AFFIRMED THE STAND OF THE ASSESSING OFFICER NOTICING THAT THE ASSESSEE HAD NOT APPEARED BEFORE HIM AND MADE ANY SUBMISSIONS INSPITE OF FIXING THE CASE ON MULTI PLE OCCASIONS. 6. AGAINST SUCH AN ORDER OF THE CIT(A), ASSESSEE IS IN FURTHER APPEAL BEFORE US. 7. WE FIND THAT THE POSITION NOTED BY THE CIT(A) CONTINUES TO SUBSIST E VEN BEFORE US IN AS MUCH AS ASSESSEE HAS NOT APPEARED INSPITE OF ISSUANCE OF NOTICES OF H EARING. MOREOVER, THE ASSESSING OFFICER HAS REACHED TO A CATEGORICAL FINDING THAT THERE WAS NO EVIDENCE TO SUBSTANTIATE THE MOVEMENT OF GOODS OR DELIVERY CHALLANS WITH RESPECT TO THE IMPUGNED PURCHASES FROM THE FOUR PARTIES. CONSIDERING THE ENTIRETY OF M ATERIAL ON RECORD, WE DO NOT FIND ANY REASONS TO DEVIATE FROM THE FINDING OF CIT(A) WHICH IS HEREBY AFFIRMED. THUS, ASSESSEE FAILS IN THIS APPEAL. 4 ITA NO.6 492/MUM/2017 & 6499/ MUM/2017 SHRI ANIL JAGANNATH TIWARI 8. NOW WE MAY TAKE ITA NO 6493/MUM/2017 FOR ASSESSMENT YEAR 2011 - 12. THIS APPEAL PERTAINING TO ASSESSMENT YEAR 201 1 - 1 2 IS DIRECTED AGAINST AN ORDER PASSED BY CIT(A) - 3, THANE DATED 2 7 /0 3 /2017, WHICH IN TURN, ARISES OUT OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 14 4 R.W.S.147 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 9. IN THIS APP EAL, THE FIRST ISSUE IS WITH REGARD TO THE ADDITION OF RS.16,85,316/ - TREATING THE PURCHASES MADE FROM CERTAIN PARTIES AS BOGUS. THE SAID ADDITION STANDS ON SIMILAR FOOTING TO THAT DEALT WITH BY US IN THE APPEAL FOR THE A.Y.2011 - 12. SINCE THE FACTS AND CI RCUMSTANCES ARE SIMILAR, OUR DECISION ON THIS ISSUE IN A.Y.2011 - 12 APPLIES MUTATIS MUTANDIS IN THIS YEAR TOO AND ACCORDINGLY ON THIS ASPECT ASSESSEE FAILS. 10. THE SECOND ISSUE IN THIS APPEAL IS WITH REGARD TO DISALLOWANCE OF RS.3,20,993/ - AS BEING UNVERIFIED EXPENDITURE. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT ASSESSEE HAD CLAIMED VARIOUS EXPENSES IN THE PROFIT AND LOSS ACCOUNT UNDER THE HEADS FREIGHT, SALARIES, WAGES, ENTERTAINMENT, CONVEYANCE AND TELEPHONE ETC., FOR WHICH NO DETAILS WERE FURNISHED INSPITE OF PROVIDING ADEQUATE OPPORTUNITY TO THE ASSESSEE. FOR THE SAME REASON, CIT(A) HAS ALSO AFFIRMED THE DISALLOWANCE. EVEN BEFORE US , THE SAID POSITION CONTINUES AND WE FIND NO REASONS TO INTERFERE WITH THE D ECISION OF THE CIT(A) WHICH IS AFFIRMED. THUS, ON THIS ASPECT ASSESSEE FAILS. 11. THE THIRD DISALLOWANCE IS WITH REGARD TO TREATMENT OF UNSECURED LOANS OF RS.4,00,000/ - AS UNEXPLAINED. THE UNSECURED LOANS APPEARING IN THE BALANCE SHEET WERE TREATED AS UNEX PLAINED BY THE ASSESSING OFFICER ON THE GROUND THAT ASSESSEE DID NOT FURNISH T HE IDENTITY, CREDITWORTHINESS OR THE GENUINENESS OF THE CREDITORS CONCERNED AND THEREFORE, THE AMOUNT OF 5 ITA NO.6 492/MUM/2017 & 6499/ MUM/2017 SHRI ANIL JAGANNATH TIWARI RS.4,00,000/ - HAS BEEN TREATED AS UNEXPLAINED CASH CREDIT U/S.68 OF THE I T ACT. WITH THE SAID REASONS, CIT(A) HAS ALSO UPHELD THE ADDITION. 12. BEFORE US, THERE IS NO MATERIAL TO DISTRACT FROM THE FINDINGS OF LOWER AUTHORITIES WHICH ARE HEREBY AFFIRMED. ON THIS ASPECT ALSO ASSESSEE FAILS. 13. LAST GROUND IN THIS APPEAL IS WITH REGARD TO THE ACTION OF THE CIT(A) IN DECLINING TO ALLOW DEDUCTIONS OF RS.1,07,323/ - CLAIMED BY THE ASSESSEE IN CHAPTER VIA OF THE ACT. THE ASSESSING OFFICER NOTES THAT IN THE ABSENCE OF ANY EVIDENCE OR DETAIL OF INVESTMENTS MADE FOR CLAIMING OF THE SAID D EDUCTIONS, THE SAME WAS DECLINED. THE SAME POSITION CONTINUED BEFORE THE CIT(A) , WHO AFFIRMED THE ACTION OF THE ASSESSING OFFICER. EVEN BEFORE US, THE POSITION NOTED BY THE CIT(A) CONTINUES, THEREFORE, WE HAVE NO ALTERNATIVE BUT TO AFFIRM THE DECISION OF THE CIT(A). THUS, ON THIS ASPECT ALSO ASSESSEE FAILS. 14. RESULTANTLY, BOTH THE APPEALS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 / 01 /201 8 SD/ - SD/ - ( RAVISH SOOD ) (G.S. PANNU) JUDICIAL MEMBER ACCOCUNTANT MEMBER MUMBAI , DATED 31 / 01 /2018 KARUNA , SR. PS CO PY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY/ (DY./ASSTT. REGISTRAR) , ITAT, MUMBAI