AMAR DIAMOND TOOLS, MUMBAI V. ITO WD 1(1), THANE

ITA 6547/MUM/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 2311 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 16-11-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R BHOOPATHILD
• Keywords: Bogus purchase; Reassessment proceedings
• Section: 143(3); 142(1); 201; 143(2); 148; 132

Judgement Text

ITA NO.6547-50/MUM/2018 AMAR DIAMOND TOOLS ASSESSMENT YEARS :2010-11 TO 2012-13 1 - IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI . . , , BEFORE HONBLE SHRI C.N. PRASAD, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM ./ I.T.A. NO.6547/MUM/2018 ( / ASSESSMENT YEAR: 2010-11) & ./ I.T.A. NO.6549/MUM/2018 ( / ASSESSMENT YEAR: 2010-11) & ./ I.T.A. NO.6548/MUM/2018 ( / ASSESSMENT YEAR: 2011-12) & ./ I.T.A. NO.6550/MUM/2018 ( / ASSESSMENT YEAR: 2012-13) AMAR DIAMOND TOOLS 1 ST FLOOR, SHIV DARSHAN BUILDING MUMBAI PUNE ROAD OPP. SHIV SENA SAKHA MUMBRA THANE 400 612 / VS. I TO - WARD 1 ( 1 ) , THANE ROOM NO.23, ASHAR IT PARK 6 TH FLOOR, ROAD NO.16Z WAGLE INDUSTRIAL ESTATE THANE 400 604 ! ./ ./PAN/GIR NO. AAHFA-7543-D ( !# /APPELLANT ) : ( $!# / RESPONDENT ) ASSESSEE BY : NONE REVENUE BY : SHRI R. BHOOPATHI LD. DR / DATE OF HEARING : 05/12/2019 / DATE OF PRONOUNCEMENT : 05/12/2019 ITA NO.6547-50/MUM/2018 AMAR DIAMOND TOOLS ASSESSMENT YEARS :2010-11 TO 2012-13 2 / O R D E R PER BENCH 1. THE GRIEVANCE OF ASSESSEE IN ALL THE AFORESAID A PPEALS FOR ASSESSMENT YEARS [IN SHORT REFERRED TO AS AY] 201 0-11 TO 2012-13 IS COMMON I.E. ESTIMATED ADDITIONS ON ACCOUNT OF ALLEGED BOGUS PURCHASES. 2. NONE APPEARED FOR ASSESSEE AND NO VALID ADJOURNM ENT APPLICATION IS ON RECORD. KEEPING IN VIEW THE ISSUE INVOLVED, T HE MATTER WAS PROCEEDED WITH EX-PARTE QUA THE ASSESSEE. THE LD. DR SUBMITTED THAT THE IMPUGNED ORDERS WOULD NOT REQUIRE ANY INTERFERE NCE ON OUR PART. 3.1 FACTS FOR AY 2010-11 ARE THAT THE ASSESSEE BEIN G RESIDENT FIRM STATED TO BE ENGAGED IN MANUFACTURING & TRADING OF INDUSTRIAL TOOLS WAS ASSESSED U/S 143(3) R.W.S. 147 ON 21/03/2016 WHEREI N THE INCOME OF THE ASSESSEE WAS DETERMINED AT RS.1.08 LACS AS AGAINST NIL RETURN FILED BY THE ASSESSEE ON 30/03/2012 WHICH WAS PROCESSED U/S 143(1). 3.2 PURSUANT TO RECEIPT OF CERTAIN INFORMATION IN T HE COURSE OF SEARCH ACTION U/S 132 IN CASE OF SHRI RAJENDRA JAIN GROUP, IT TRANSPIRED THAT THE ASSESSEE OBTAINED BOGUS PURCHASE BILLS OF RS.8.69 L ACS FROM ENTITIES RUN BY THE SAID GROUP. ACCORDINGLY, THE CASE WAS RE OPENED AS PER DUE PROCESS OF LAW VIDE ISSUANCE OF NOTICE U/S 148 ON 3 1/03/2015 WHICH WAS FOLLOWED BY STATUTORY NOTICES U/S 143(2) & 142(1) W HEREIN THE ASSESSEE WAS DIRECTED TO SUBSTANTIATE THE PURCHASE TRANSACTI ONS. 3.3 ALTHOUGH THE ASSESSEE DEFENDED THE PURCHASES BU T INTER-ALIA, RELYING UPON STATEMENT GIVEN BY SHRI RAJENDRA JAIN DURING SEARCH ACTION, LD. AO ESTIMATED ADDITIONS AGAINST THESE PURCHASES @12.5% AND ASSESSED THE INCOME AT RS.1.08 LACS. ITA NO.6547-50/MUM/2018 AMAR DIAMOND TOOLS ASSESSMENT YEARS :2010-11 TO 2012-13 3 4. DURING APPELLATE PROCEEDINGS, LEARNED CIT(A) PRO VIDED ANOTHER OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE THE SAI D TRANSACTIONS. IN RESPONSE, THE ASSESSEE FILED COPIES OF PURCHASE BIL LS, BANK STATEMENTS, FINANCIAL STATEMENTS ETC. TO SUPPORT THE SAID TRANS ACTIONS. HOWEVER, NOT CONVINCED LD. CIT(A) REJECTED BOOKS U/S 145(3) AND UPHELD THE STAND OF LD. AO IN ESTIMATING THE ADDITIONS @12.5%. AGGRIEVE D, THE ASSESSEE IS UNDER FURTHER APPEAL BEFORE US. 5. AFTER CAREFUL CONSIDERATION, WE ARE OF THE CONSI DERED OPINION THAT THERE COULD BE NO SALE WITHOUT ACTUAL PURCHASE OF M ATERIAL KEEPING IN VIEW THE ASSESSEES NATURE OF BUSINESS. UNDISPUTEDL Y THE ASSESSEE WAS IN POSSESSION OF PRIMARY PURCHASE DOCUMENTS AND THE PAYMENTS TO THE SUPPLIERS WERE THROUGH BANKING CHANNELS. HOWEVER, A T THE SAME TIME, THE SEARCH ACTION U/S 132 IN THE CASE OF SHRI RAJEN DRA JAIN GROUP INDICATED THAT THE ENTITIES RUN BY THE GROUP WERE N OT CARRYING OUT ANY GENUINE BUSINESS ACTIVITIES BUT ENGAGED IN PROVIDIN G ACCOMMODATION BILLS ONLY. THE ASSESSEE ALSO FAILED TO SUBMIT VARI OUS DETAILS CALLED FOR BY LD. CIT(A) IN THE PRESCRIBED FORMAT. THEREFORE, THE SAID FACTUAL MATRIX, IN OUR OPINION, WAS A FIT CASE TO MAKE ESTIMATED ADDIT IONS IN THE HANDS OF THE ASSESSEE. FINDING THE ESTIMATION OF 12.5% TO BE QUITE FAIR AND REASONABLE, WE DISMISS THE APPEAL. 6.1 ITA NO. 6549/MUM/2018 IS APPEAL FOR SAME AY 201 0-11 SINCE REASSESSMENT PROCEEDINGS WERE TRIGGERED FOR THE SEC OND TIME BY ISSUANCE OF NOTICE U/S 148 ON 30/03/2017 SINCE IT T RANSPIRED THAT THE ASSESSEE HAD MADE MORE PURCHASES FROM SOME MORE ENT ITIES RUN BY THE SAID GROUP. ACCORDINGLY, THE ASSESSEE WAS SADDLED W ITH ESTIMATED ITA NO.6547-50/MUM/2018 AMAR DIAMOND TOOLS ASSESSMENT YEARS :2010-11 TO 2012-13 4 ADDITIONS OF 12.5% AGAINST ADDITIONAL PURCHASES. TH E SAME, UPON CONFIRMATION BY FIRST APPELLATE AUTHORITY, IS UNDER CHALLENGE BEFORE US. 6.2 FACTS BEING PARI-MATERIA THE SAME, TAKING THE SAME VIEW, WE CONFIRM THE STAND OF LOWER AUTHORITIES AND DISMISS THE APPEAL. 7.1 SIMILAR ARE THE APPEALS FOR AYS 2011-12 & 2012- 13 WHEREIN THE ASSESSEE HAS BEEN SADDLED WITH ESTIMATED ADDITIONS OF 12.5% AGAINST ALLEGED BOGUS PURCHASES. THE SAME, UPON CONFIRMATIO N BY FIRST APPELLATE AUTHORITY, IS UNDER CHALLENGE BEFORE US. 7.2 FACTS BEING PARI-MATERIA THE SAME, TAKING THE SAME VIEW, WE CONFIRM THE STAND OF LOWER AUTHORITIES AND DISMISS BOTH THESE APPEALS. 8. RESULTANTLY, ALL THE APPEALS STAND DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 05 TH DECEMBER, 2019. SD/- SD/- (C.N. PRASAD) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 05/12/2019 SR.PS, JAISY VARGHESE 6789:69 / COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. $!# / THE RESPONDENT 3. - ( ) / THE CIT(A) 4. - / CIT CONCERNED 5. ./ ' 0 , 0 , / DR, ITAT, MUMBAI 6. /123 / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.