ITO 20(1)(2), MUMBAI V. SHRI. GOPINATH GANPAT BOLINJKAR, MUMBAI

ITA 6910/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9958 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2021
• 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
• Section: 147; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC , MUMBAI BEFORE SHRI SAKTIJIT DEY (JM) ITA NO. 6910 /MUM/2019 ASSESSMENT Y EAR: 2009 - 10 & ITA NO. 6911/MUM/2019 ASSESSMENT Y EAR: 2010 - 11 INCOME TAX OFFICER - 20(1)(2), ROOM NO. 119, 1 ST FLOOR, PIRAMAL CHAMBER, LALBAUG, PAREL, MUMBAI - 400012 VS. SHRI GOPINATH GANPAT BOLINJKAR, 16, WADALA UDYOG BHAVAN, NAIGAON CROSS ROAD, WADALA, MUMBAI - 400031 PAN: AAAPB7387F (APPELLANT) (RESPONDENT) REVENUE BY : SHRI SAURABH KUMAR R AI (DR) ASSESSEE BY : NONE DATE OF HEARING : 25 /05 /202 1 DATE OF PRONOUNCEMENT: 09 / 0 7 /202 1 O R D E R THESE ARE APPEALS BY T HE REVENUE AGAINST TWO SEPARATE ORDER S , BOTH DATED 07.08.2019 , OF LEARNED COMMISSIO NER OF INCOME TAX (APPEALS) - 28 , MUMBAI FOR THE A SSESSMENT YEAR S 2009 - 10 AND 2010 - 11. 2. THE ONLY COMMON D ISPUTE IN BOTH THESE APPEALS RELATES TO P ARTIAL RELIEF GRANTED BY LEARNED COMMISSIONER (APPEALS) IN THE M ATTER OF ADDITION MADE BECAUSE OF ALLEGED NON - GENUINE PURCHASES. 3. BRIEFLY THE FACTS ARE, THE ASSESSEE IS AN INDIVIDUAL AND STATED TO BE ENGAGED IN MANUFACTUR ING OF ENGINEERING INSTRUMENTS. FOR BOTH THE ASSESSMENT YEARS UNDER DISPUTE, THE ASSESSEE HAD FILED HIS RETURNS OF INCOME IN REGULAR COURSE, WHICH WERE PROCESSED UNDER SECTION 143 (1) OF THE INCOME TAX ACT , 1961 . SUBSEQUENTLY, THE ASSESSING OFFICER ( AO ) RECEIVED INFORMATION FROM THE SALES TAX DEPARTMENT, GOVERNMENT OF MAHARASHTRA THROUGH DGIT 2 ITA NO S . 6910 & 6911 / MUM/2019 ASSESSMENT YEAR S : 20 09 - 1 0 & 2010 - 11 (INV.) INDICATING THAT P URCHASES WORTH RS. 9,10,636/ - I N ASSESSMENT YEAR 2009 - 10 AND RS. 17,71,807/ - IN ASSESSMENT YEAR 2010 - 11 ARE NON GENUINE , AS , THE CONCERNED SELLING DEALERS WERE FOUND TO BE INDULGING IN PROVIDING ACCOMMODATION BILLS WITHOUT REAL SALE TRANS ACTION. BASED ON SUCH INFORMATION, THE AO REOPENED THE ASSESSMENTS UNDER SECTION 147 OF THE ACT. THOUGH, IN COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE CLAIMED THE DISPUTED PURCHASES TO BE GENUINE, H OWEVER, THE AO WAS NOT CONVINCED. HE OBSERVED , NOTICES ISSUED UNDER SECTION 133 (6) OF THE ACT SEEKING INFORMATION FROM THE CONCERNED SE LLING DEALERS DID NOT BEAR ANY RESULT. THEREFORE, HE CONCLUDED THAT THOUGH THE S OURCE OF PURCHASES IS DOUBTFUL, HOWEVER, THE ASSESSEE MUST HAVE PURCHASE D THE GOODS FROM UNVERI FIED SOURCES. THEREFORE, HE DISALLOWED 25% OUT OF THE PURCHASES MADE FROM ALL THE PARTIES , EXCEPT , M/S VIMAL ENGINEERING CORPORATION . IN RESPECT OF THIS PARTY, T HE AO DISALLOWED THE ENTIRE PURCHASES IN BOTH THE ASSESSMENT YEARS UNDER DISPUTE. THE ASSESSEE CONTESTED THE DISALLOWANCE S MADE BY THE A O IN APPEALS PREFERRED BEFORE LEARNED COMMISSIONER (APPEALS). PARTLY ACCEPTING THE SUBM ISSIONS OF THE ASSESSEE, LEARNED COMMISSIONER (APPEALS) RESTRICTED THE DISALLOWANCE TO 12.5% OF ALL THE PURCHASES , INCLUDING , T HE PURCHASES MADE FROM M/S VIMAL ENGINEERING CO. IN BOTH THE ASSESSMENT YEARS UNDER DISPUTE. 4. WHEN THE APPEALS WERE CALLED FOR HEARING, NO ONE APPEARED ON BEHALF OF THE ASSESSEE. CONSIDERING THE NATURE OF DISPUTE, I PROCEED TO DISPOSE OF THE APPEALS EX - PARTE QUA TH E ASSESSEE AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE AND BASED ON MATERIAL ON RECORD. 5 . I HAVE CONSI DERED THE SUBMISSIONS OF LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL ON RECORD. IT IS EVIDENT , THOUGH , THE AO HAS DOUBTED THE SOURCE OF PURCHASES, H OWEVER, HE WAS CONVINCED THAT THE ASSESSEE HAD PURCHASED THE GOODS FROM UNVERIFIED SOURCES IN RESPECT OF ALL PURCHASES EXCEPT THE PURCHASES MADE FROM M/S VIMAL ENGINEERING CO. THEREFORE, WHILE DISALLOWING THE ENTIRE PURCHA SES RELATING TO THE VIMAL ENGINEERING CO. HE HAS DISALLOWED ONLY THE PROFIT ELEMENT EMBEDDED IN ALL OTHER PURCHASES BY ESTIMATING AT 25%. W HEREAS , LEARNED COMMISSIONER 3 ITA NO S . 6910 & 6911 / MUM/2019 ASSESSMENT YEAR S : 20 09 - 1 0 & 2010 - 11 (APPEALS) HAS RESTRICTED THE DISALLOWANCE TO 12.5% OF ALL PURCHASES. IT IS OBSERVED , WHI LE RESTRICTING TH E DISALLOWANCE TO 12.5%, LEARNED COMMISSIONER (APPEALS) HAS TAKEN NOTE OF THE APPLICABLE VAT RATE ON THE GOODS PURCHASED . E VEN OTHERWISE ALSO , IN SIMILAR NATURE OF CASES THE PROFIT ELEMENT IS GENERALLY ESTIMATED AT 12.5%. IN VIEW OF THE AF ORESAID , I DO NOT FIND ANY INFIRMITY IN THE DECISION OF LEARNED COMMISSIONER (APPEALS). GROUNDS ARE DISMISSED. 6 . IN THE RESULT, BOTH THE APPEAL S ARE DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH JULY , 2021 . SD/ - (SAKTIJIT DEY) JUDICIAL MEMBER MUMBAI ; DATED: 09 / 07 /202 1 ALINDRA, PS / 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