ITO 19 (1)(2), MUMBAI V. ASHURAM UDARAMJI BISHNOI, MUMBAI

ITA 6975/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9088 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 06-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R BHOOPATI
• Keywords: Bogus purchase; Reassessment proceedings
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA NO. 6975/MUM/2018(A.Y.2010-11) ITA NO. 6977/MUM/2018(A.Y.2011-12) ITA NO. 6978/MUM/2018(A.Y.2009-10) INCOME TAX OFFICER 19(1)(2), ROOM NO.204,2 ND FLOOR, MATRU MANDIR, TARDEO ROAD, MUMBAI ...... APPELLANT VS. ASHURAM UDARAMJI VISHNOI, SHOP NO.7, GROUND FLOOR, 66, COOPER BLDG., T.P. STREET, MUMBAI 400 020 PAN: AEJPB6455M ..... RESPONDENT APPELLANT BY : SHRI R. BHOOPATI RESPONDENT BY : NONE DATE OF HEARING : 18/12/2019 DATE OF PRONOUNCEMENT : 06/01/2020 ORDER THESE THREE APPEALS BY THE REVENUE FOR ASSESSMENT YEARS 2010-11, 2011-12 AND 2009-10 ARE DIRECTED AGAINST THE ORDERS OF COMMISSIONER OF INCOME TAX (APPEALS)-54 [IN SHORT THE CIT(A) ], MU MBAI FOR RESPECTIVE ASSESSMENT YEARS. ALL THE IMPUGNED ORDERS ARE OF EV EN DATE I.E. 27/09/2018. SINCE THE ISSUE RAISED IN ALL THE THREE APPEALS IS ARISING FROM SAME SET OF FACTS AND IDENTICAL ISSUE IS INVOLVED, THESE APPEALS ARE TAKEN UP TOGETHER FOR ADJUDICATION AND ARE DISPOSED OF BY TH IS COMPOSITE ORDER. 2 ITA NO. 6975/MUM/2018(A.Y.2010-11) ITA NO. 6977/MUM/2018(A.Y.2011-12) ITA NO. 6978/MUM/2018(A.Y.2009-10) 2. THE NOTICE OF THE APPEAL WAS SENT TO THE ASSESSE E/RESPONDENT THROUGH RPAD. NONE APPEARED TO REPRESENT THE ASSES SEE. HENCE, THESE APPEALS ARE TAKEN UP FOR HEARING WITH THE ASSISTANC E OF LD. DEPARTMENTAL REPRESENTATIVE AND THE MATERIAL AVAILABLE ON RECORD . 3. FOR THE SAKE OF CONVENIENCE TO DECIDE THESE APPE ALS, THE FACTS ARE EXTRACTED FROM ITA NO.6975/MUM/2018 FOR ASSESSMENT YEAR 2010-11. THE ASSESSEE IS A TRADER IN FERROUS AND NON-FERROUS METAL. THE ASSESSING OFFICER RECEIVED INFORMATION FROM SALES TAX DEPA RTMENT , MAHARASHTRA AND DGIT(INV) THAT THE ASSESSEE HAS INDULGED IN OBT AINING BOGUS PURCHASES BILLS FROM HAWALA DEALERS. CONSEQUENTLY, ASSESSMEN TS FOR ASSESSMENT YEAR 2009-10, 2010-11 AND 2011-12 WERE REOPENED. THE ASSESSING OFFICER IN REASSESSMENT PROCEEDINGS FOR ASSESSMENT YEARS 2010-11 HELD THAT THE ASSESSEE HAS MADE BOGUS PURCHASES TO THE T UNE OF RS.84,29,433/- FROM VARIOUS PARTIES. THE ASSESSING OFFICER MADE A DDITION OF RS.10,53,679/- I.E. 12.5% OF UNPROVED PURCHASES. A GGRIEVED AGAINST THE ASSESSMENT ORDER DATED 05/11/2016 PASSED UNDER SECT ION 143(3) R.WS. 147 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT ), THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). THE FIRST APPELLATE AUTH ORITY PARTIALLY MODIFIED THE ASSESSMENT ORDER AND DIRECTED THE ASSESSING OFF ICER TO REDUCE GROSS PROFIT ALREADY DECLARED BY THE ASSESSEE FROM THE E STIMATED ADDITION OF 12.5%. THE REVENUE DID NOT FIND FAVOUR WITH THE VI EW OF FIRST APPELLATE AUTHORITY. HENCE, THE PRESENT APPEAL BY THE DEPARTM ENT. 4. SHRI R.BHOOPATI REPRESENTING THE DEPARTMENT VEHE MENTLY DEFENDED THE ASSESSMENT ORDER AND SUBMITTED THAT THE ASSESSI NG OFFICER HAD 3 ITA NO. 6975/MUM/2018(A.Y.2010-11) ITA NO. 6977/MUM/2018(A.Y.2011-12) ITA NO. 6978/MUM/2018(A.Y.2009-10) ESTIMATED GROSS PROFIT AT 12.5% OF THE BOGUS PURC HASES BY FOLLOWING THE DECISION OF HON'BLE GUJARAT HIGH COURT RENDERED IN THE CASE OF CIT VS. SIMITH P. SHETH, IN INCOME TAX APPEAL NO.553 OF 2 012 DECIDED ON 16/01/2013. ONCE THE ADDITION HAS BEEN ESTIMATED B Y FOLLOWING THE ORDER OF HON'BLE HIGH COURT, NO FURTHER MODIFICATION WA S REQUIRED TO BE MADE BY THE CIT(A). THE LD. DEPARTMENTAL REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESSEE FAILED TO SUBSTANTIATE GENUINENES S OF THE PURCHASES AND PARTIES FROM WHOM SUSPICIOUS PURCHASES WERE MADE. THE LD. DEPARTMENTAL REPRESENTATIVE PRAYED FOR REVERSING TH E FINDINGS OF CIT(A) AND TO UPHOLD THE ASSESSMENT ORDER. 5. I HAVE HEARD THE SUBMISSIONS MADE BY LD. DEPART MENTAL REPRESENTATIVE AND HAVE EXAMINED THE MATERIAL AVAIL ABLE ON RECORD. THE ADDITION ON ACCOUNT OF BOGUS PURCHASES HAVE BEEN MA DE BY ASSESSING OFFICER BY ESTIMATING GROSS PROFIT @ 12.5% OF ALLEG ED BOGUS PURCHASES . IN THE FIRST APPELLATE PROCEEDINGS, THE CIT(A) HAS RED UCED 12.5% G.P ESTIMATED BY ASSESSING OFFICER BY THE GROSS PROFIT ALREADY DECLARED BY THE ASSESSEE. TAKING INTO CONSIDERATION, ENTIRETY OF FACTS, I FIND NO REASON TO INTERFERE WITH THE FINDINGS OF CIT(A). THE ORDER O F FIRST APPELLATE AUTHORITY IS REASONABLE AND THE SAME IS UPHELD. THE APPEAL O F THE REVENUE IS WITHOUT ANY MERIT AND, HENCE, THE SAME IS DISMISSE D. ITA NOS.6977/MUM/2018(A.Y.2011-12 & 6978/MUM/2018(A .Y.2009- 10): 6. THE LD. DEPARTMENTAL REPRESENTATIVE STATED AT TH E BAR THAT THE FACTS IN ASSESSMENT YEAR 2011-12 AND 2009-10 ARE SIMIL AR TO THE FACTS IN ASSESSMENT YEAR 2010-11. THE ADDITION HAS BEEN MA DE BY ASSESSING 4 ITA NO. 6975/MUM/2018(A.Y.2010-11) ITA NO. 6977/MUM/2018(A.Y.2011-12) ITA NO. 6978/MUM/2018(A.Y.2009-10) OFFICER BY ESTIMATING GROSS PROFIT @ 12.5% OF ALLEG ED BOGUS PURCHASES. THE CIT(A) HAS MODIFIED THE ASSESSMENT ORDER BY REDUCING THE GROSS PROFIT ALREADY DECLARED BY THE ASSESSEE FROM 12.5% G.P ESTIMATED BY ASSESSING OFFICER ON BOGUS PURCHASES. 7. ON SAME SET OF FACTS I HAVE DISMISSED THE APP EAL OF REVENUE IN ITA NO.6975/MUM/2018 FOR ASSESSMENT YEAR 2010-11. THE FINDINGS GIVEN THEREIN WOULD MUTATIS MUTANDIS APPLY TO BOTH THESE APPEALS BY THE REVENUE. ACCORDINGLY, THE APPEALS OF THE REVENUE F OR ASSESSMENT YEARS 2011-12 AND 2009-10 ARE DISMISSED SANS MERIT. 8. TO SUM UP, ALL THE THREE APPEALS OF THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON MONDAY, TH E 06 TH DAY OF JANUARY,2020. SD/- (VIKAS AWASTHY) JUDICIAL MEMBER MUMBAI, DATED 06/01/2020 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