SHRI. RATANKUMAR SINGHANIA, MUMBAI V. ITO 29 (3)(1), MUMBAI

ITA 7967/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 3543 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 26-12-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SANJAY SETHILD
• Keywords: Tangible material
• Section: 143(3); 143(1)

Judgement Text

1 - IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI , , BEFORE HONBLE SHRI VIKAS AWASTHY, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO.7967/MUM/2019 ( / ASSESSMENT YEAR: 2009-10) SHRI RATANKUMAR SINGHANIA 20, SUYOG INDUSTRIAL ESTATE LBS MARG, VIKHROLI (W) MUMBAI-400 083 / VS. I TO - 29(3)(1) KAUTILYA BHAWAN, BKC BANDRA EAST MUMBAI-400 057 ./ ./ PAN/GIR NO. AAHPS-6826-R ( + / APPELLANT ) : ( ./+ / RESPONDENT ) + 0/ APPELLANT BY : NONE ./+ 0 / RESPONDENT BY : SHRI SANJAY SETHI - LD.DR / DATE OF HEARING : 08/06/2021 / DATE OF PRONOUNCEMENT : 08/06/2021 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER): - 1. THE ASSESSEE CHALLENGES THE ORDER OF LD. COMMISS IONER OF INCOME TAX (APPEALS)-40, MUMBAI [CIT(A)] DATED 23/10/2019 WHICH HAS CONFIRMED ADDITION OF 12.5% ON ACCOUNT OF ALLEGED BOGUS PURCH ASES AS MADE BY LD. AO WHILE FRAMING AN ASSESSMENT U/S 143(3) R.W.S. 14 7 ON 19/02/2015. THE ASSESSEE ALSO CHALLENGES THE REASSESSMENT PROCEEDIN GS ON LEGAL GROUNDS. 2 2. THOUGH NONE APPEARED FOR ASSESSEE, HOWEVER, MATE RIAL ON RECORD WAS SUFFICIENT FOR DISPOSAL OF THE APPEAL. THE LD. DR PLEADED FOR DISMISSAL OF THE APPEAL. 3.1 THE MATERIAL FACTS ARE THAT THE ASSESSEE BEING RESIDENT INDIVIDUAL STATED TO BE ENGAGED IN MANUFACTURING OF TOOLS & DY ES WAS ASSESSED FOR THE YEAR UNDER CONSIDERATION U/S 143(3) R.W.S. 147 OF T HE ACT ON 19/02/2015. THE ORIGINAL RETURN FILED BY THE ASSESSEE WAS PROCE SSED U/S 143(1) OF THE ACT. HOWEVER, PURSUANT TO RECEIPT OF CERTAIN INFORM ATION FROM DGIT (INV.) / SALES TAX DEPARTMENT, MUMBAI, IT TRANSPIRED THAT TH E ASSESSEE PROCURED ACCOMMODATION PURCHASE BILLS OF RS.63.66 LACS FROM SEVENTEEN ENTITIES AS DETAILED IN THE ASSESSMENT ORDER. ACCORDINGLY, THE CASE WAS REOPENED AS PER DUE PROCESS OF LAW AND THE ASSESSEE WAS REQUIRE D TO FILE REQUISITE DETAILS TO SUBSTANTIATE THE PURCHASES. 3.2 IN SUPPORT, THE ASSESSEE FILED DOCUMENTARY EVID ENCES IN THE SHAPE OF COPIES OF PURCHASE BILLS, LEDGER EXTRACTS, AND BANK STATEMENT EVIDENCING PAYMENT TO THE SUPPLIER THROUGH BANKING CHANNELS. H OWEVER, IT FAILED TO PRODUCE ANY OF THE SUPPLIERS FOR CONFIRMATION OF AC COUNT. THE LD. AO, RELYING UPON THE DECISION OF HONBLE GUJARAT HIGH C OURT IN CIT V/S SIMIT P.SHETH (2012; 356 ITR 451), ESTIMATED ADDITION 12.5% AGAINST THESE PURCHASES. THE ACTION OF LD. AO, UPON CONFIRMATION BY LD. CIT(A), IS IN FURTHER CHALLENGE BEFORE US. 4. GOING BY THE FACTUAL MATRIX AS ENUMERATED IN THE ORDERS OF LOWER AUTHORITIES, WE FIND THAT THE ASSESSEES SALES TURN OVER WAS NOT IN DOUBT AND THE ASSESSEE WAS IN POSSESSION OF PRIMARY PURCH ASE DOCUMENTS. THE PAYMENT TO THE SUPPLIERS WAS THROUGH BANKING CHANNE LS. THERE COULD BE NO 3 SALE WITHOUT ACTUAL PURCHASE OF MATERIAL KEEPING IN VIEW THE ASSESSEES NATURE OF BUSINESS. AT THE SAME TIME, THE ASSESSEE COULD NOT PRODUCE EVEN SINGLE SUPPLIER TO CONFIRM THE TRANSACTIONS. THE FA CTS OF THE CASE MADE IT A FIT CASE TO ESTIMATE THE PROFIT ELEMENT EMBEDDED IN THESE TRANSACTIONS. BOTH THE LOWER AUTHORITIES, AFTER DUE CONSIDERATION OF A SSESSEES SUBMISSIONS AS WELL AS MATERIAL ON RECORD, ESTIMATED THE ADDITIONS @12.5% WHICH IS QUITE FAIR TO PLUG THE LEAKAGE OF REVENUE. THEREFORE, THE ESTIMATION COULD NOT BE TERMED AS UNJUSTIFIED, IN ANY MANNER. FINDING NO RE ASON TO INTERFERE IN THE IMPUGNED ORDER, WE DISMISS THE APPEAL. 5. SO FAR AS THE LEGAL GROUNDS ARE CONCERNED, WE FI ND THAT THE ORIGINAL RETURN WAS PROCESSED U/S 143(1) AND LD. AO WAS IN P OSSESSION OF TANGIBLE MATERIAL SO AS TO REOPEN THE CASE OF THE ASSESSEE. THE SAID MATERIAL INDICATED POSSIBLE ESCAPEMENT OF INCOME IN THE HAND S OF THE ASSESSEE. NOTHING MORE WAS REQUIRED AT THIS STAGE. THEREFORE, NO INFIRMITY COULD BE FOUND IN THE JURISDICTION OF LD. AO. 6. THE APPEAL STANDS DISMISSED. ORDER PRONOUNCED ON 08 TH JUNE, 2021. SD/- SD/- (VIKAS AWASTHY) (MANOJ KUMAR AGGARWAL) HI / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; I DATED : 08/06/2021 SR.PS, JAISY VARGHESE 4 01234514 / COPY OF THE ORDER FORWARDED TO : 1. + / THE APPELLANT 2. ./+ / THE RESPONDENT 3. K ( ) / THE CIT(A) 4. K / CIT CONCERNED 5. I LM .I?IIN , IN , / DR, ITAT, MUMBAI 6. MOPQ / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.