ITO 17 (2)(4), MUMBAI V. M/S NAFISA ENGINEERING WORKS, MUMBAI

ITA 7097/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 3750 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 18-11-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Keywords: Bogus purchase
• Section: 143(3); 147

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 7097 //2019 (. . 2009-10 ) ITA NO.7097/MUM/2019 (A.Y.2009-10) ITO-17(2)(4), R. NO. 112, KAUTALYA BHAVAN, BANDRA KURLA COMPLEX, VASHI RAILWAY COMPLEX, NAVI MUMBAI- 400051 ...... ) / APPELLANT VS. M/S NAFISA ENGINEERING WORKS, GEORGE CHEMPAKATHENAL, 412, 4 TH FLOOR, DOSHI CHAMBER, POONA STREET, NANDLAL JANI ROAD, DANA BUNDER, MUMBAI-400009. PAN: AAGFN6149R ..... *,/ RESPONDENT ) -/ APPELLANT BY : MS. SMITA VERMA *, -/ RESPONDENT BY : NONE . / DATE OF HEARING : 05/05/2021 . / DATE OF PRONOUNCEMENT : 05/05/2021 / ORDER PER VIKAS AWASTHY, J.M: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-58, MUMBAI [HEREINAFTER REF ERRED TO AS THE CIT(A)] DATED 09.08.2019 FOR THE ASSESSMENT YEAR (AY) 2009- 10. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM TH E RECORDS ARE: THE ASSESSEE IS ENGAGED IN MANUFACTURING OF TRUCK & TROLLY. ON T HE BASIS OF 2 . 7097 //2019 (. .2009-10 ) ITA NO.7097/MUM/2019 (A.Y.2009-10) INFORMATION RECEIVED FROM DGIT (INVESTIGATION), MUM BAI, THE ASSESSMENT IN THE CASE OF ASSESSEE WAS RE-OPENED. AS PER THE INFORMAT ION RECEIVED, THE ASSESSEE ALLEGEDLY OBTAINED BOGUS PURCHASE BILLS FROM FOLLOW ING PARTIES: (I) ASIAN STEEL RS. 1,71,860/- (II) MARUTI STEEL TRADERS RS. 53,274/- TOTAL RS. 2,25,134/- 3. THE ASSESSEE FAILED TO PRODUCE THE DEALERS FROM WHOM GOODS WERE PURCHASED AND THE TRAIL OF GOODS. THE AO HELD THE A BOVESAID PURCHASES TO BE NON- GENUINE AND MADE ADDITION OF THE ENTIRE BOGUS PURCH ASES. THE ASSESSEE FILED APPEAL AGAINST THE ASSESSMENT ORDER DATED 04.03.201 5 PASSED UNDER SECTION 147 READ WITH SECTION 143(3) OF THE INCOME TAX ACT, 196 1 (HEREINAFTER REFERRED TO AS THE ACT) ASSAILING ADDITION OF ENTIRE BOGUS PURCH ASES. THE CIT(A) AFTER EXAMINING THE FACTS RESTRICTED THE ADDITION TO 25% OF SUCH PU RCHASES. HENCE, THE PRESENT APPEAL BY REVENUE. 4. MS. SMITA VERMA REPRESENTING THE DEPARTMENT VEHE MENTLY DEFENDING THE ASSESSMENT ORDER SUBMITTED THAT THE CIT(A) WITHOUT PROPERLY APPRECIATING THE FACTS HAS RESTRICTED THE ADDITION TO 25% OF THE TOT AL BOGUS PURCHASES. THE ASSESSEE HAS FAILED TO DISCHARGE HIS ONUS IN PROVIN G GENUINENESS OF THE PURCHASES AND THE DEALERS. THE LD. DR PRAYED FOR REVERSING TH E FINDINGS OF CIT(A) AND CONFIRMING 100% ADDITION ON ACCOUNT OF BOGUS PURCHA SES. 5. SUBMISSIONS MADE BY LD. DR HEARD, ORDERS OF AUTH ORITIES BELOW EXAMINED. UNDISPUTEDLY THE ASSESSEE HAS FAILED TO PROVE AUTHE NTICITY OF THE DEALERS AND GENUINENESS OF THE PURCHASES. HOWEVER, THE SALES TU RNOVER DECLARED BY THE ASSESSEE HAS NOT BEEN DISPUTED BY THE AO. WITHOUT P URCHASES/INPUTS THERE 3 . 7097 //2019 (. .2009-10 ) ITA NO.7097/MUM/2019 (A.Y.2009-10) CANNOT BE SALES/MANUFACTURING. THE HONBLE BOMBAY H IGH COURT IN THE CASE OF PCIT VS. PARAMSHAKTI DISTRIBUTORS PVT. LTD. IN ITA NO. 413 OF 2017 DECIDED ON 15.07.2019 HAS HELD THAT ENTIRE BOGUS PURCHASES CAN NOT BE ADDED, IT IS THE PROFIT EMBEDDED IN SUCH PURCHASES THAT HAS TO BE ADDED. TH E CIT(A) HAS ESTIMATED PROFIT ELEMENT IN BOGUS PURCHASES AT 25% AND HAS RE STRICTED THE ADDITION TO RS. 56,234/-. I FIND NO INFIRMITY IN THE IMPUGNED ORDER , THE SAME IS UPHELD AND THE APPEAL OF REVENUE IS DISMISSED. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON WEDNESDAY , THE 5 TH DAY OF MAY, 2021. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, 3/ DATED: 05/05/2021 SK, PS * 4 * 4 * 4 * 4 COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT , 2. *, / THE RESPONDENT. 3. 5 ( )/ THE CIT(A)- 4. 5 CIT 5. * , . . . , / DR, ITAT, MUMBAI 6. 9 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI