ITO, WARD- 1(1), THANE V. FIVE NINE FOOTWEAR, MUMBAI

ITA 6742/MUM/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1372 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 29-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KUMAR PADMAPANI BORA
• Assessee Lawyers: VISHWAS V MEHENDALE
• Keywords: Bogus purchase

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.6742/MUM/2018(A.Y. 2010-11) ITA NO.6743/MUM/2018(A.Y. 2011-12) INCOME TAX OFFICER, WARD-1(1), ROOM NO.23, B-WING, 6 TH FLOOR, ASHAR IT PARK, WAGLE INDUSTRIAL ESTATE, ROAD NO.16Z, THANE 400604 ...... APPELLANT VS. M/S. FIVE NINE FOOTWEAR, GALA NO.9-B, PETWALA CHAWL, 242/244, M.A.ROAD, MUMBAI 400 008 PAN:AACFF1414H ..... R ESPONDENT APPELLANT BY : SHRI KUMAR PADMAPANI BORA RESPONDENT BY : SHRI VISHWAS V. ME HENDALE DATE OF HEARING : 11/12/2019 DATE OF PRONOUNCEMENT : 11/12/2019 ORDER PER VIKAS AWASTHY, JM: THESE TWO APPEALS BY THE REVENUE ARE DIRECTED AGAI NST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-1 (IN SHORT THE CIT(A)), THANE DATED 27/09/2018 COMMON FOR ASSESSMENT YEARS 2010-1 1 AND 2011-12. SINCE THE ISSUE RAISED IN BOTH THE APPEALS IS IDEN TICAL AND IS ARISING FROM SAME SET OF FACTS, THEREFORE, THESE APPEALS ARE TAK EN UP TOGETHER FOR ADJUDICATION AND ARE DISPOSED OF VIDE THIS COMMON O RDER. 2 ITA NO.6742/MUM/2018(A.Y. 2010-11) ITA NO.6743/MUM/2018(A.Y. 2011-12) 2. SHRI KUMAR PADMAPANI BORA REPRESENTING THE REVENUE SUBMI TTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACT URING AND TRADING OF FOOT WEARS. INFORMATION WAS RECEIVED FROM THE SALE TAX D EPARTMENT, GOVERNMENT OF MAHARASHTRA THAT ASSESSEE IS BENEFICIARY OF ACCOMMO DATION ENTRIES PROVIDED BY HAWALA DEALERS. ASSESSMENT FOR ASSESSMENT YEARS 2010-11 AND 2011-12 WERE REOPENED. THE ASSESSING OFFICER OBSERVED THAT ASSE SSEE HAS MADE BOGUS PURCHASES FROM M/S.SHAKTI TRADING CO. TO THE TUNE O F RS.5,19,985/- IN ASSESSMENT YEAR 2010-11 AND RS.77,022/- IN ASSESSME NT YEAR 2011-12. CONSEQUENTLY, THE ASSESSING OFFICER MADE ADDITION O F THE AFORESAID AMOUNTS IN THE RESPECTIVE ASSESSMENT YEARS. IN THE FIRST APPEL LATE PROCEEDINGS THE CIT(A) RESTRICTED THE ADDITION TO RS.4,89,235/- IN ASSESSM ENT YEAR 2010-11 AND RS.22,886/- IN ASSESSMENT YEAR 2011-12. THE LD.DEPA RTMENTAL REPRESENTATIVE CONTENDED THAT THE CIT(A) HAS FAILED TO TAKE NOTE O F THE FACT THAT THE ASSESSEE HAS FAILED TO SUBSTANTIATE GENUINENESS OF THE PURCH ASES MADE FROM M/S. SHAKTI TRADING CO.. THE LD.DEPARTMENTAL REPRESENTATIVE PR AYED FOR REVERSING THE FINDINGS OF CIT(A) AND RESTORING THE ADDITIONS MADE BY ASSESSING OFFICER. 3. ON THE OTHER HAND, SHRI VISHWAS V. MEHENDALE APP EARING ON BEHALF OF THE ASSESSEE VEHEMENTLY DEFENDED THE IMPUGNED ORDER AND PRAYED FOR CONFIRMING THE SAME. THE LD. AUTHORIZED REPRESEN TATIVE OF THE ASSESSEE SUBMITTED THAT ORDER OF CIT(A) IS REASONABLE. THE SALES MADE BY THE ASSESSEE HAVE NOT BEEN DISPUTED BY THE DEPARTMENT, THEREFORE , THE ENTIRE ALLEGED BOGUS PURCHASES CANNOT BE ADDED BACK. 4. BOTH SIDES HEARD AND ORDERS OF AUTHORITIES BELOW WERE PERUSED. IT IS AN UNDISPUTED FACT THAT SALES MADE BY THE ASSESSEE HAV E NOT BEEN DISPUTED BY THE REVENUE. THUS, THE ENTIRE ALLEGED BOGUS PURCHASES CANNOT BE ADDED. IT IS THE SUPPRESSED PROFIT ELEMENT ON BOGUS PURCHASES THAT C AN ONLY BE ADDED AS 3 ITA NO.6742/MUM/2018(A.Y. 2010-11) ITA NO.6743/MUM/2018(A.Y. 2011-12) INCOME OF THE ASSESSEE. AFTER EXAMINING THE IMPUGN ED ORDER WE FIND THAT THE SAME IS REASONABLE AND JUSTIFIED, HENCE, NO INTERFE RENCE IS WARRANTED. 5. IN THE RESULT, IMPUGNED ORDER IS UPHELD AND APPE ALS OF THE REVENUE FOR ASSESSMENT YEARS 2010-11 AND 2011-12 ARE DISMISSED BEING DEVOID OF ANY MERIT. ORDER PRONOUNCED IN THE OPEN COURT AFTER HEARING OF THE APPEALS ON WEDNESDAY THE 11 TH DAY OF DECEMBER, 2019. SD/- SD/- (R.C.SHARMA) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 11/12/2019 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