ITO 33 (2)(1), MUMBAI V. JITENDRA PAPER INDUSTRIES, MUMBAI

ITA 6748/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6257 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 29-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P BHOOPATHI
• Assessee Lawyers: PARAKASH JHUNJHUNWALA
• Keywords: Bogus purchase; Set aside
• Section: 201

Judgement Text

T HE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA ( A M) I.T.A. NO. 6748 /MUM/ 201 8 (ASSESSMENT YEAR 20 09 - 10 ) ITO - 33(2)(1) ROOM NO. 613 6 TH FLOOR, C - 12 PRATYAKSHAKAR BHAVAN BKC, MUMBAI - 400051. V S . M/S. JITENDRA PAPER INDU STRIES 04, RADHA DALVI NAGAR C.P.ROAD, KANDIVALI - E MUMBAI - 400 101. PAN : AAAFJ0144J ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY SHRI PARAKASH JHUNJHUNWALA DEPARTMENT BY SHR I P. BHOOPATHI DATE OF HEARING 11.12 . 201 9 DATE OF PRONOUNCEMENT 04 . 0 2 . 20 20 O R D E R THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A) DATED 27.4.2015 PERTAINS TO A.Y. 2009 - 10. 2. THE ISSUE RAISED ARE : - 1. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT( A) ERRED IN RANDOMLY RESTRICTING THE DISALLOWANCE AT 12.5% OF THE BOGUS PURCHASE WITHOUT ANY PROPER REASON OR LOGIC.' 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN GIVING THE RELIEF OF 1 2.5% OF THE BOGUS PU RCHASE TO THE ASSESSEE WITHOUT APPRECIATING THE FACT THAT THE AUTHORISED REPRESENTATIVE OF THE ASSESSEE VOLUNTARILY ACCEP TED THE ADDITION OF 25% OF THE B OGUS PURCHASE.' 3. 'THE APPELLANT PRAYS THAT THE ORDER OF THE LD. CIT(A) ON THE ABOVE GROUND B E SET ASIDE AN D THAT OF THE ASSESSING OFFICER BE RESTORED.' M/S. JITENDRA PAPER INDUSTRIES 2 3. BRIEFLY STATED FACTS IN THIS CASE ARE THAT THE ASSESSING OFFICER HAS MADE 100% DISALLOWANCE FOR BOGUS PURCHASES AMOUNTING TO RS. 12,87,037/ - WITH RESPECT TO INFORMATION RECEIVED FROM SAL ES TAX DEPARTMENT FOR BOGUS PURCHASES FROM TWO PARTIES NAMELY M/S. SAMIR TRADING CORPORATION AND M/S. ARIHANT TRADING COMPANY. IN COURSE OF ASSESSMENT, THE ASSESSEE STATED BEFORE THE ASSESSING OFFICER THAT THERE WAS NO DEALING FROM THE ABOVE MENTIONED PART IES DURING F.Y. 2008 - 09. IN SUPP ORT THE ASSESSEE SUPP LI ED PARTY - WISE PURCHASE DETAILS. THE ASSESSING OFFICER DID NOT CONSIDER THIS ASPECT OF ASSESSEES SUBMISSION AND IN ROUTINE FASHION NOTED THAT NOTICE SENT TO THE ALLEGED BOGUS SUPPLIERS WERE RETURNED A ND HENCE MADE IMPUGNED DISALLOWANCE. 4. UPON ASSESSEES APPEAL LEARNED CIT(A) APPRECIATED THE FACT THAT WHEN THERE WAS NO PURCHASE, THERE WAS NO QUESTION OF MAKING DISALLOWANCE OF BOGUS PURCHASE. LEARNED CIT(A) OBSERVED THAT NOBODY CAN PROVE THE NEGATIVE THAT HE HAS NOT DONE SOMETHING. TH AT TH E ASSESSEE HAS DULY FILED ALL THE DETAILS OF HIS BUSINESS AND ALL PURCHASES AND STATED THAT HE DID NOT MAKE ANY PURCHASES, WHICH THE ASSESSING OFFICER BRUSHED ASIDE AND SIMPLY BASED ON THE INFORMATION OF THE SALES TA X DEPARTMENT ADDED ENTIRE PURCHASES. HENCE, ON FINDING THAT THERE WAS NO PURCHASE FROM THE SAID PARTY WHICH BOGUS PURCHASES WERE DISALLOWED BY THE ASSESSING OFFICER, LEARNED CIT(A) DELETED THE ADDITION. 5. AGAINST THIS ORDER ASSESSEE IS IN APPEAL B EFORE ITAT . I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. I FIND THAT IN THERE IS NO INFIRMITY IN THE ORDER OF LEARNED CIT(A). WHEN THERE IS NO PURCHASE FROM CONCERNED PARTY THERE WAS NO QUESTION OF DISALLOWANCE OF BOGUS PURCHASES FROM THE SAID PA RTY. HENCE, THERE IS NO INFIRMITY IN THE ORDER OF LEARNED CIT(A). MOREOVER, AS RIGHTLY POINTED OUT BY LEARNED COUNSEL OF THE ASSESSEE TH E GROUND RAISED BY THE REVENUE ITSELF HAS MISPLACED. IT TALKS ABOUT THE LEARNED CIT(A) SUSTAINING 12.5% OF BOGUS PURCHAS E AS AGAINST ASSESSEE ACCEPTING VOLUNTARILY 25% BOGUS PURCHASE. HENCE, GROUND ITSELF IS MISCONCEIVED AND NOT ARISING OUT OF THE ORDER OF LEARNED CIT(A). M/S. JITENDRA PAPER INDUSTRIES 3 HENCE, THIS APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 4. 2 . 20 20 . SD/ - (SH A MIM YAHYA ) ACCOUNTANT MEMBER MUMBAI ; DATED : 4 / 2 / 20 20 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE R ESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR ) PS ITAT, MUMBAI