PRAVINA RUPAREL, MUMBAI V. ITO 7(3)(3), MUMBAI

ITA 7424/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3083 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 12-12-2014
• Court: TRIBUNAL
• Assessee Lawyers: D C JAIN
• Keywords: Bogus purchase; Business income; Salary income
• Section: 69C; 6

Judgement Text

, - , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI , ! ' , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, ITA NO.7424/MUM/2014 ASSESSMENT YEAR: 2010-11 SMT. PRAVINA N. RUPAREL, C/O. M/S U.B. LAKHANI & CO. A/202, NEEL KANTHDHARA, P. DHANWANTI HOSPITAL, N.S. ROAD, MULUND (W), MUMBAI-400080 / VS. ITO-7(3)(3), ROOM NO.675, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 / ASSESSEE / REVENUE P.A. NO . ADOPR0943E $ % & / ASSESSEE BY SHRI D.C. JAIN $ % & / REVENUE BY SHRI OM PRAKASH MEENA-DR / DATE OF HEARING 20/06/2016 & / DATE OF ORDER: 20/06/2016 ITA NO.7424/MUM/2014 SMT. PRAVINA N. RUPAREL 2 & / O R D E R THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 03/11/2014 OF THE LD. FIRST APPELLATE AUTHORI TY, MUMBAI, CHALLENGING THE CONFIRMATION OF ADDITION OF RS.1,33,00,97/- MADE BY THE ASSESSING OFFICER U/S 6 9C OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT) BEIN G PEAK AMOUNT PURCHASES STATED TO BE BOGUS PURCHASES AS PE R INFORMATION FROM SALES TAX DEPARTMENT. 2. DURING HEARING OF THIS APPEAL, SHRI D. C. JAIN , LD. COUNSEL FOR THE ASSESSEE, CONTENDED THAT THE IMPUGN ED ISSUE IS COVERED BY THE DECISION FROM HONBLE BOMBA Y HIGH COURT IN THE CASE OF CIT VS NIKUNJI/EXIM ENTER PRISES PVT. LTD. (372 ITR 619)(BOM.). HOWEVER, THE LD. DR, SHRI OM PRAKASH MEENA, CONTENDED THAT FACTS IN THE CASE BEFORE HONBLE HIGH COURT ARE DIFFERENT, THEREFORE, THE RATION LAID DOWN THEREIN IS NOT APPLICABLE TO THE F ACTS OF THE PRESENT ASSESSEE. IN REPLY, THE LD. COUNSEL FOR THE ASSESSEE, CONTENDED THAT CONSIDERING THE FACTS OF T HE PRESENT APPEAL, SOME REASONABLE DISALLOWANCE MAY BE MADE, WHICH MAY BE TO THE EXTENT OF 5% OF THE PURCH ASES. THE LD. DR HAD NO OBJECTION TO THE PROPOSITION MADE BY THE LD. COUNSEL FOR THE ASSESSEE. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL, DERI VING INCOME FROM SALARY CARRYING ON PROPRIETARY BUSINESS ITA NO.7424/MUM/2014 SMT. PRAVINA N. RUPAREL 3 UNDER THE NAME AND STYLE OF M/S SUPREME ENTERPRISES , ENGAGED IN THE BUSINESS OF BUYING OF CHEMICAL FROM MARKET AND EXPORT OUTSIDE INDIA. THE ASSESSEE FILED HER RETURN OF INCOME ON 22/09/2010, DECLARING TOTAL INC OME AT RS.19,47,618/-. THE SCRUTINY ASSESSMENT U/S 143( 3) WAS COMPLETED ON 25/03/2013 DETERMINING THE INCOM E AT RS.31,94,480/- BY MAKING AN ADDITION OF RS.13,30,097/-, STATING TO BE BOGUS PURCHASES, U/S 69C OF THE ACT. ON APPEAL, BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEAL), THE STAND TAKEN IN THE ASSESSM ENT ORDER WAS CONFIRMED. THE AGGRIEVED ASSESSEE IS IN A PPEAL BEFORE THIS TRIBUNAL. WE FIND THAT THE ASSESSEE CLA IM TO HAVE MADE PURCHASES TO THE TUNE OF RS.6,84,23,238/- FROM VARIOUS PARTIES AND EXPORTED THE SAME OUT OF I NDIA. THE LD. ASSESSING OFFICER RECEIVED INFORMATION FROM THE MAHARASHTRA SALES TAX DEPARTMENT THAT CERTAIN PERSO NS HAVE GIVEN BOGUS BILLS FOR THE PURCHASES. ON VERIF ICATION OF THE LIST, IT WAS FOUND THAT THE FOLLOWING SUPPLI ERS WERE FOUND TO BE SUSPICIOUS/BOGUS BY THE SALES TAX DEPARTMENT. SL. NO. NAME OF THE PARTIES AMOUNT OF PURCHASES (IN RUPEES) 1 M/S SHREE GANESH TRADING COMPANY 14,06,080/- 2 M/S MANAV IIMPEX 1,16,73,813/- 3 M/S MAHAVIR ENTERPRISES 3,66,080/- 4 M/S SHREYAS MARKETING 7,03,040/- WE FIND THAT AGAINST THE CLAIMED PURCHASES OF RS.6,84,23,238/-, THE LD. ASSESSING OFFICER HAS DIS ALLOWED THE PURCHASES TO THE TUNE OF RS.13,30,097/- U/S 69C OF ITA NO.7424/MUM/2014 SMT. PRAVINA N. RUPAREL 4 THE ACT BY TREATING THE SAME AS BOGUS PURCHASES. ASSESSEE DECLARED TOTAL SALES (EXPORTS) TO THE TUNE OF RS.7,28,26,335/-. THE STAND OF THE ASSESSEE IS THAT WHEN SALE HAS BEEN ACCEPTED THEN PURCHASES ALSO HAVE TO BE ACCEPTED. IN THE LIGHT OF THE DECISION FROM HONBL E JURISDICTIONAL HIGH COURT (SUPRA), WE FIND THAT THE ASSESSEE WANTS TO TAKE THE SHELTER OF THE AFORESAID DECISION WITHOUT EXPLAINING THE FACTS, BECAUSE, WHE REVER, THE LD. ASSESSING OFFICER FOUND THE PURCHASES WITHI N THE PARAMETER, THE SAME WERE ALLOWED. EVEN OTHERWISE, THE ASSESSEE HAS NOT PROVED THAT THE PURCHASES WERE 100 % GENUINE. OTHER ARGUMENT TAKEN BEFORE US IS THAT PRO PER OPPORTUNITY WAS NOT PROVIDED TO THE ASSESSEE TO CRO SS EXAMINATION THE PARTIES FROM WHOM PURCHASES WERE CLAIMED TO BE MADE. THE BENCH ASKED THE LD. COUNSEL FOR THE ASSESSEE WHETHER THE MATTER CAN BE SENT BACK TO THE FILE OF THE ASSESSING OFFICER SO THAT OPPORTUNITY M AY BE PROVIDED TO THE ASSESSEE. THE LD. COUNSEL REQUESTED THE BENCH THAT THE MATTER MAY NOT BE SENT BACK AND A REASONABLE DISALLOWANCE MAY BE MADE. CONSIDERING TH E TOTALITY OF FACTS, MATERIAL AVAILABLE ON RECORD, RE ASONING CONTAINED IN THE ASSESSMENT ORDER/IMPUGNED ORDER AN D THE ASSERTIONS MADE FROM BOTH SIDES, WE DIRECT THE LD. ASSESSING OFFICER TO MAKE DISALLOWANCE OF 5% OF THE PURCHASES MADE BY THE ASSESSEE, THUS, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ITA NO.7424/MUM/2014 SMT. PRAVINA N. RUPAREL 5 FINALLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOW ED. THIS ORDER WAS PRONOUNCED IN THE OPEN IN THE PRESENCE OF LD. REPRESENTATIVE FROM BOTH SIDES (AND ACCEPTED BY THEM) AT THE CONCLUSION OF THE HEARING ON 20/06/2016. SD/- (JOGINDER SINGH) ! ' / JUDICIAL MEMBER MUMBAI; DATED : 20/06/2016 F{X~{T? P.S / ! & $ )!*+ ,&+-* / COPY OF THE ORDER FORWARDED TO : 1. '#$%& / THE APPELLANT 2. '(%& / THE RESPONDENT. 3. ) ) * ( '#$ ) / THE CIT, MUMBAI. 4. ) ) * / CIT(A)- , MUMBAI 5. -./ ' , ) '#$ ' 1 , / DR, ITAT, MUMBAI 6. /2 3$ / GUARD FILE. & / BY ORDER, (-# ' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI