ITO 20 (3)(4), MUMBAI V. SHRI. SURESH UKCHAND MEHTA, MUMBAI

ITA 6903/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1811 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 08-11-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHIDD ARAMAP P A
• Keywords: Corroborative evidences; Accommodation entries
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC , MUMBAI BEFORE SHRI SAKTIJIT DEY (JM) ITA NO. 6903 /MUM/2019 ASSESSMENT Y EAR: 2009 - 10 INCOME TAX OFFICER - 20(3)(4), ROOM NO. 603, 6 TH FLOOR, PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI - 400012 VS. SHRI SURESH UKCHAND MEHTA, 1002, 10 TH FLOOR, TARDEO TOWER, 75B MADAN MOHAN MALVIYA ROAD, BEHIND HP PETROL PUMP, MUMBAI - 400034 PAN: AACPM4555E (APPELLANT) (RESPONDENT) REVENUE BY : SHRI SHIDDARAM A P P A (DR) ASSESSEE BY : NONE DATE OF HEARING : 24 /05 /202 1 DATE OF PRONOUNCEMENT: 25 / 0 6 /202 1 O R D E R THIS IS AN APPEAL BY THE REVENUE AGAINST THE ORDER DATED 21.08 .2019 OF LEARNED COMMI SSIO NER OF INCOME TAX (APPEALS) - 3 2 , MUMBAI FOR THE A SSESSMENT YEAR 2009 - 10 . 2. WHEN THE APPEAL WAS CALLED FOR HEARING, NO ONE APPEARED FOR THE ASSESSEE . HOWEVER, CONSIDERING THE NATURE OF DISPUTE, I PROCEED TO DISPOSE OF THE APPEAL EX - PARTE QUA THE ASSESS EE AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE AND BASED ON MATERIALS ON RECORD. 3. BRIEFLY THE FACTS ARE, THE ASSESSEE IS AN INDIVIDUAL AND IS STATED TO BE A TRADER IN METALS. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HIS RETUR N OF INCOME ON 18.09.2009 DECLARING TOTAL INCOME OF RS. 3,52,083/ - . BASED ON INFORMATION RECEIVED FROM DGIT (INV.), MUMBAI THAT THE ASSESSEE IS A 2 ITA NO. 6903 / MUM/2019 ASSESSMENT YEAR: 20 09 - 1 0 BENEFICIARY OF ACCOMMODATION ENTRIES BY WAY OF BOGUS PURCHA SE BILLS WORTH RS. 26,96,720/ - , T HE ASSESSING OFFIC ER ( AO ) REOPENED THE ASSESSM ENT UNDER SECTION 147 OF THE ACT. IN COURSE OF ASSESSMENT PROCEEDING, THE AO CALLED UPON THE ASSESSEE TO PROVE PURCHASE S WITH SUPPORTING EVIDENCES. HOWEVER, THE EVIDENCES FURNISHED BY THE ASSESSEE WAS NO T UP TO THE SATISFACTION O F THE AO. THEREFORE, HE TREATED THE PURCHASES AS NON - GENUINE. HOWEVER, BEING OF THE VIEW THAT THE ASSESSEE MIGHT HAVE PURCHASE D THE GOODS FROM GREY MARKET, THE AO DISALLOWED 12.5% OUT OF THE ALLEGED NON - GENUINE PURCHASES. IN OTHER WORDS, HE DISALLOWED AN AMOUNT OF RS. 3,37,090/ - . THE ASSESSEE CONTESTED THE AFORE SAID DISALLOWANCE BEFORE LEARNED COMMISSIONER (APPEALS) . P ARTLY ACCEPTING THE CONTENTION OF THE ASSESSEE, LEARNED CO MMISSIONER (APPEALS) RESTRICTED THE DISALLOWANCE TO 5% OF THE ALLEGED NON - GENUINE PURCHASES. 4. I HAVE CONSIDERED THE SUBMIS SIONS, LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIALS ON RECOR D. THE DISPUTE BEFORE ME IS CONFINED ONLY TO THE PROFIT ELEMENT WHICH CAN BE CONSIDERED FOR DISALLOWANCE . W HILE THE AO HAS ESTIMATED TH E PROFIT ELEMENT EMBEDDED IN THE ALLEGED NON GENUINE PURCHASES AT 12.5%, LEARNED COMMISSIONER (APPEALS) HAS REDUCED IT TO 5% BY TAKING NOTE OF THE APPLICABLE VAT RATE OF 4% ON THE GOODS PURCHASE D BY THE ASSESSEE. HAVING CONSIDERED THE MATERIAL FACTS AS WEL L AS THE NATURE OF BUSINESS OF THE ASSESSEE, I FULLY AGREE WITH THE DECISION OF LEARNED COMMISSIONER (APPEALS) IN RESTRICTING THE DISALLOWANCE TO 5%. GROUNDS RAISED ARE DISMISSED. 5 . IN THE RESULT, APPEAL IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH JUNE , 2021 . SD/ - (SAKTIJIT DEY) JUDICIAL MEMBER MUMBAI ; DATED: 25 / 06/2021 ALINDRA, PS 3 ITA NO. 6903 / MUM/2019 ASSESSMENT YEAR: 20 09 - 1 0 / 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 . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI