Appeal Details
Counselvise Citation
[2021] 107 COUNSELVISE.COM (IT) 6208 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 7 month(s) 11 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
09-09-2021
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
D
Assessment Year
2009-2010
Appeal Filed On
28-01-2020
Judgement Text
3 ITA 666/M/2020 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY (JUDICIAL MEMBER) AND SHRI RAJESH KUMAR (ACCOUNTANT MEMBER) I.T.A. NO.666/MUM/2020 (ASSESSMENT YEAR 2009-10) MOHAMMED RIZWAN MOHD. KALLAN HANUMAN NAGAR, EKTA CHAWL COMMITTEE, M/S FAHID ENTERPRISES, ASHOK NAGAR, HILL NO.3, KAMANI KURLA (W), MUMBAI 400 070 PAN : AGJPK2270K VS ITO 26(2)(3), MUMBAI APPELLANT RESPONDENT APPELLANT BY NONE RESPONDENT BY SHRI BHARAT ANDHALE, DR DATE OF HEARING 30-08-2021 DATE OF PRONOUNCEMENT 09-09-2021 O R D E R PER SAKTIJIT DEY, JM THIS IS AN APPEAL BY THE ASSESSEE AGAINST ORDER DAT ED 31.10.2019 OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-38, MUMBAI CON FIRMING PENALTY IMPOSED OF RS.12,51,540/- UNDER SECTION 271(1)(C) OF THE IN COME TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2009-10. 2. WHEN THE APPEAL WAS CALLED FOR HEARING, NONE APP EARED ON BEHALF OF THE ASSESSEE. CONSIDERING THE NATURE OF DISPUTE, WE PR OCEED TO DISPOSE OF THE APPEAL 3 ITA 666/M/2020 EX PARTE QUA THE ASSESSEE AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE AND BASED ON MATERIALS ON RECORD. 3. BRIEFLY, THE FACTS ARE, THE ASSESSEE IS AN INDIV IDUAL AND STATED TO BE A TRADER IN LUBRICANT OIL. FOR THE ASSESSMENT YEAR UNDER DIS PUTE, THE ASSESSEE FILED HIS RETURN OF INCOME ON 30-08-2009 DECLARING TOTAL INCO ME OF RS.7,56,296/-. SUBSEQUENTLY, THE ASSESSING OFFICER RECEIVED INFORM ATION FROM THE SALES TAX AUTHORITIES THROUGH THE DGIT(INV), MUMBAI THAT PURC HASES WORTH RS.2,91,36,808/- CLAIMED TO HAVE BEEN MADE DURING THE YEAR FROM TWEL VE PARTIES ARE NON GENUINE. BASED ON SUCH INFORMATION, THE ASSESSING OFFICER RE OPENED THE ASSESSMENT UNDER SECTION 147 OF THE ACT. IN COURSE OF ASSESSMENT PRO CEEDINGS, THE ASSESSING OFFICER CALLED UPON THE ASSESSEE TO PROVE THE GENUINENESS O F PURCHASES. THOUGH, THE ASSESSEE FURNISHED SOME DOCUMENTARY EVIDENCES TO PR OVE THE PURCHASES; HOWEVER, THEY WERE NOT TO THE SATISFACTION OF THE A SSESSING OFFICER. THUS, ULTIMATELY, THE ASSESSING OFFICER HELD THAT THE PUR CHASES ARE NON GENUINE. HOWEVER, CONSIDERING THE FACT THAT THE ASSESSEE HAS FURNISHED THE DETAILS OF SALES AND PURCHASES, THE ASSESSING OFFICER RESTRICTED THE ADDITION TO THE PROFIT ELEMENT ESTIMATED AT 12.5%. IN OTHER WORDS, HE MADE AN ADDI TION OF RS.36,42,101/-. BASED ON SUCH ADDITION, THE ASSESSING OFFICER INITI ATED PROCEEDINGS FOR IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT AND U LTIMATELY PASSED AN ORDER IMPOSING PENALTY OF RS.12,51,540/- ALLEGING CONCEAL MENT OF INCOME. THE PENALTY SO IMPOSED WAS CONFIRMED BY LEARNED COMMISSIONER (A PPEALS). 4. WE HAVE CONSIDERED THE SUBMISSIONS OF LEARNED DE PARTMENTAL REPRESENTATIVE AND PERUSED MATERIALS ON RECORD. IT IS EVIDENT, CERTAIN PURCHASES MADE BY THE ASSESSEE DURING THE YEAR WERE TREATED A S NON GENUINE BASED ON CERTAIN INFORMATION RECEIVED FROM SALES-TAX AUTHORI TIES. HOWEVER, IT IS A FACT ON 3 ITA 666/M/2020 RECORD THAT IN COURSE OF ASSESSMENT PROCEEDINGS, TH E ASSESSEE HAD FURNISHED SOME EVIDENCES REGARDING THE PURCHASES. FURTHER, TH E ASSESSEE HAS ALSO FURNISHED THE QUANTITATIVE DETAILS OF SALES AND PURCHASES. IN FACT, THE ASSESSING OFFICER HAS ALSO ACCEPTED THE FACT THAT THE DISPUTED GOODS WERE PURCHASED BY THE ASSESSEE AND UTILIZED FOR SALE. FOR THIS REASON ALONE, INSTE AD OF DISALLOWING THE ENTIRE PURCHASES, THE ASSESSING OFFICER HAS DISALLOWED THE PROFIT ELEMENT EMBEDDED IN SUCH DISPUTED PURCHASES BY ESTIMATING AT 12.5%. THU S, THE DOUBT, IF ANY, IS NOT WITH REGARD TO THE PURCHASES PER SE, BUT ONLY WITH REGARD TO THE SOURCE OF PURCHASES. THE INABILITY OF THE ASSESSEE TO PROVE T HE SOURCE OF PURCHASES COULD BE FOR VARIOUS FACTORS INCLUDING THE NON AVAILABILITY OF THE CONCERNED PARTIES. HOWEVER, THAT BY ITSELF, CANNOT BE A REASON TO CONC LUDE THAT THE ASSESSEE HAS CONCEALED HIS INCOME WITHIN THE MEANING OF SECTION 271(1)(C) OF THE ACT. IN ANY CASE OF THE MATTER, ULTIMATELY, THE ADDITION BASED ON WHICH PENALTY UNDER SECTION 271(1)(C) WAS IMPOSED, WAS MADE PURELY ON ESTIMATE BASIS. THAT BEING THE CASE, NO PENALTY UNDER SECTION 271(1)(C) OF THE ACT CAN B E IMPOSED ON SUCH ESTIMATED ADDITION. IN VIEW OF THE AFORESAID, WE DELETE THE P ENALTY IMPOSED OF RS.12,51,540/- UNDER SECTION 271(1)(C) OF THE ACT. 5. IN THE RESULT, APPEAL IS ALLOWED. ORDER PRONOUNCED ON 09/09/2021. SD/- SD/- (RAJESH KUMAR) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DT : 09/09/2021 PAVANAN 3 ITA 666/M/2020 COPY TO : 1. APPELLANT 2. RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) 5. THE DR, ITAT, MUMBAI 6. GUARD FILE /TRUE COPY/ BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI
