SAMARTHMAL SANGHVI, MUMBAI V. ITO 19(3)(2), MUMBAI

ITA 6574/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4541 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 19-11-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KUMAR PADMAPANI BORA
• Assessee Lawyers: GAUTAM SALECHA
• Keywords: Reopening of assessment; Bogus purchase; Reassessment proceedings
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA NO.6574/MUM/2018(A.Y.2009-10) SAMARTHMAL D.SANGVI, C/O. FITWEL INDUSTRIES, 10, TULSI BLDG., 178/180, KHETWADI, BACK ROAD, MUMBAI 400 004 PAN:AAFPS 4195P ...... APPELLANT VS. INCOME TAX OFFICER -19(3)(2) MATRU MANDIR,TARDEO ROAD, MUMBAI 400 007 ..... RE SPONDENT APPELLANT BY : SHRI GAUTAM SALECHA RESPONDENT BY : SHRI KUMAR PADMAPA NI BORA DATE OF HEARING : 09/12/2019 DATE OF PRONOUNCEMENT : 11/02/2020 ORDER PER VIKAS AWASTHY, JM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) 7, MUMBAI ( IN SHORT THE CIT(A) ) DATED 09/10/2018. 2. BRIEF FACTS OF THE CASE AS EMANATING FROM RECORD S ARE: ON THE BASIS OF INFORMATION RECEIVED FROM DGIT (INV), MUMBAI, THE A SSESSING OFFICER REOPENED 2 ITA NO.6574/MUM/2018(A.Y.2009-10) THE ASSESSMENT UNDER SECTION 147 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT)ON THE GROUND THAT THE ASSESSEE HAS INDULGED I N OBTAINING BOGUS PURCHASE BILLS AGGREGATING TO RS.72,36,259/- FROM VARIOUS H AWALA OPERATORS. THE ASSESSING OFFICER ESTIMATED GP @12.5% ON THE ALLE GED BOGUS PURCHASES AND THUS, MADE ADDITION OF RS.9,04,532/-. AGGRIEVED AGAINST REOPENING OF ASSESSMENT AND THE ADDITION MADE, THE ASSESSEE FILE D APPEAL BEFORE CIT(A). THE CIT(A) DISMISSED THE APPEAL OF ASSESSEE IN TO TO. HENCE, THE PRESENT APPEAL BY THE ASSESSEE. 3. SHRI GAUTAM SALECHA APPEARING ON BEHALF OF TH E ASSESSEE SUBMITTED THAT THE CIT(A) HAS ERRED IN CONFIRMING ADDITION TO THE EXTENT OF GP ESTIMATED AT 12.5% ON ALLEGED BOGUS PURCHASES. IN FACT THE D ISALLOWANCE SHOULD HAVE BEEN RESTRICTED TO GP ESTIMATED I.E. 12.5% MINUS GP ALREADY OFFERED. 4. ON THE OTHER HAND, SHRI KUMAR PADMAPANI BORA, RE PRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE IMPUGNED ORDER A ND PRAYED FOR DISMISSING THE APPEAL OF THE ASSESSEE. THE LD. DEP ARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSING OFFICER AND CIT(A) MAD E FAIR ESTIMATION OF 12.5% OF GP ON BOGUS PURCHASES. 5. WE HAVE HEARD THE SUBMISSIONS MADE BY RIVAL SIDE S AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. THE ASSESSING OFF ICER IN REASSESSMENT PROCEEDINGS HAS HELD THAT THE ASSESSEE HAS OBTAINED BOGUS PURCHASE BILLS TO THE EXTENT OF RS.72,36,259/- FROM VARIOUS PARTIES. THE ASSESSING OFFICER FOLLOWING THE DECISION OF HONBLE GUJARAT HIGH COUR T IN THE CASE OF CIT VS. SIMIT P. SHETH, REPORTED AS 356 ITR 451 MADE DISAL LOWANCE OF RS.12.5% OF SUCH BOGUS PURCHASE I.E. RS.9,04,532/-. WE FIND THAT TH AT THE ADDITION MADE BY 3 ITA NO.6574/MUM/2018(A.Y.2009-10) AUTHORITIES BELOW IS JUST AND REASONABLE AND HENCE, WARRANTS NO INTERFERENCE. THE IMPUGNED ORDER IS UPHELD AND THE APPEAL OF THE ASSESSEE IS DISMISSED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON TUESDAY , THE 11 TH DAY OF FEBRUARY, 2020. SD/- SD/- (R.C.SHARMA) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 11/02/2020 VM , SR. PS(O/S) COPY 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