PARNAX LAB P. LTD, MUMBAI V. DCIT CIR 7(1), MUMBAI

ITA 8100/MUM/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8777 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2002-2003
• Appeal Filed On: 24-11-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJASHRI DWIVEDY
• Assessee Lawyers: S M BANDI
• Keywords: Reopening of assessment; Bogus purchase; Validity of assessment; Reassessment proceedings
• Section: 143(3); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH C BEFORE I.P. BANSAL, JUDICIAL MEMBER AND SHRI P.M.JAGTAP, ACCOUNTANT MEMBER I.T.A. NO. 8100/MUM/2010. ASSESS MENT YEAR :2002-03. PARMAX LAB PVT. LTD., DY. COMMISSIONER OF 104/107, JOGANI INDUSTRIAL COMPLEX, VS. INCOME-TAX, BUILDING NO. 8, CHUNNABHATTI, SION, CIRCLE-7(1), MUMBAI 400 022. MUMBAI. PAN AABCP3198B APPELLANT RESPONDENT. APPELLANT BY : SHRI S.M. BANDI. RESPONDENT BY : SHR I RAJASHRI DWIVEDY. DATE OF HEARING : 28-08-2012. DATE OF PRONOUNCEMENT : 26-09-2012. O R D E R PER P.M. JAGTAP, A.M. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF LEARNED CIT(APPEALS)-13, MUMBAI DATED 19-05-2010 WHEREBY HE UPHELD THE VALIDITY OF ASSESSMENT MADE BY THE AO U/S 143(3) READ WITH SECT ION 147 AND ALSO CONFIRMED THE ADDITION OF RS.23,920/- MADE THEREIN ON ACCOUNT OF UNPROVED PURCHASES. 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY WH ICH IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF PHARMACEUTICAL FORMULA TIONS. THE RETURN FILED BY IT DECLARING TOTAL INCOME AT NIL AND BOOK PROFIT U/S 1 15JB AT RS.11,96,080/- WAS 2 ITA NO. 8100/MUM/2010 ORIGINALLY ACCEPTED BY THE AO U/S 143(1). SUBSEQUEN TLY HE RECEIVED INFORMATION THAT THE PURCHASES OF RS.23,920/- MADE BY THE ASSES SEE FROM TWO PARTIES WERE NOT GENUINE. BASED ON THIS INFORMATION, HE REOPENED THE ASSESSMENT BY ISSUING NOTICE U/S 148 AFTER RECORDING THE REASONS. DURING THE COU RSE OF REASSESSMENT PROCEEDINGS, THE ASSESSEE COULD NOT ESTABLISH THAT THE PURCHASES OF RS.20,280/- MADE FROM M/S NEPTUNE ENTERPRISES AND RS.3640/- MADE FROM M/S TRI MAD WERE GENUINE DESPITE SUFFICIENT OPPORTUNITY AFFORDED BY THE AO IN THIS R EGARD. THE AO, THEREFORE, TREATED THE SAID PURCHASES AS UNPROVED AND MADE AN ADDITION OF RS.23,920/- TO THE TOTAL INCOME OF THE ASSESSEE IN THE ASSESSMENT COMPLETED U/S 143(3) READ WITH SECTION 147 BY AN ORDER DATED 12-12-2006. 3. AGAINST THE ORDER PASSED BY THE AO U/S 143(3) RE AD WITH SECTION 147, AN APPEAL WAS FILED BY THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS) CHALLENGING THEREIN THE VALIDITY OF THE SAID ASSESSMENT AS WELL AS THE ADDITION OF RS.23,920/- MADE THEREIN ON ACCOUNT OF UNPROVED PURCHASES. DURI NG THE COURSE OF APPELLATE PROCEEDINGS, THE ASSESSEE DID NOTHING MORE THAN STA TING THAT PAYMENTS AGAINST THE PURCHASES IN QUESTION WERE MADE THROUGH BANK TO EST ABLISH THE GENUINENESS OF THE SAID PURCHASES. ACCORDING TO THE LEARNED CIT(APPEAL S), THE SAME, HOWEVER, WAS NOT SUFFICIENT AND KEEPING IN VIEW THE INFORMATION RECEIVED BY THE AO DOUBTING SPECIFICALLY THE GENUINENESS OF THE SAID PURCHASES, HE CONFIRMED THE ADDITION OF RS.23,920/- MADE TO THE TOTAL INCOME OF THE ASSESSE E. HE ALSO HELD THE REOPENING OF ASSESSMENT TO BE VALID IN THE EYE OF LAW CONSIDERIN G THAT THERE WERE VALID REASONS ON THE BASIS OF WHICH THE BELIEF ABOUT THE ESCAPEME NT OF INCOME ON ACCOUNT OF BOGUS PURCHASES WAS ENTERTAINED BY THE AO. AGGRIEVE D BY THE ORDER OF THE LEARNED CIT(APPEALS), THE ASSESSEE HAS PREFERRED THIS APPEA L BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. AS RIGHTLY HELD BY THE LEARNED CIT(APPEALS), A SPECIFIC 3 ITA NO. 8100/MUM/2010 INFORMATION WAS RECEIVED BY THE AO ABOUT THE BOGUS PURCHASES MADE BY THE ASSESSEE TO THE EXTENT OF RS.23,920/- AND SINCE THE BELIEF REGARDING THE ESCAPEMENT OF ASSESSEES INCOME TO THAT EXTENT WAS ENTERTAINED BY THE AO ON THE BASIS OF THE SAID INFORMATION, THE REOPENING OF ASSESSMENT WAS I N ACCORDANCE WITH LAW. SIMILARLY THERE WAS FAILURE ON THE PART OF THE ASSE SSEE TO ESTABLISH THE GENUINENESS OF THE SAID PURCHASES BEFORE THE AO AS WELL AS BEFO RE THE LEARNED CIT(APPEALS) INSPITE OF PROPER AND ADEQUATE OPPORTUNITY GIVEN IN THIS REGARD. EVEN BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE HAS NOT BEEN ABLE TO BRING ANY THING ON RECORD TO ESTABLISH THE GENUINENESS OF THE PURCHASES IN QUEST ION HELD TO BE UNPROVED BY THE AUTHORITIES BELOW ON THE BASIS OF SPECIFIC INFORMAT ION RECEIVED IN THIS REGARD. HE HAS ALSO NOT BEEN ABLE TO RAISE ANY MATERIAL CONTEN TION IN SUPPORT OF THE ASSESSEES CASE CHALLENGING THE VALIDITY OF ASSESSMENT MADE BY THE AO U/S 143(3) READ WITH SECTION 147. WE, THEREFORE, FIND NO JUSTIFIABLE REA SON TO INTERFERE WITH THE IMPUGNED ORDER OF THE LEARNED CIT(APPEALS) 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED ON 26 TH DAY OF SEPT., 2012. SD/- (I.P. BANSAL) JUDICIAL MEMBER SD/- (P.M. JAGTAP) ACCOUNTANT MEMBER DATED : SEPT., 2012 4 ITA NO. 8100/MUM/2010 COPY TO : 1. THE ASSESSEE 2. THE RESPONDENT 3. THE CIT(A)-CONCERNED. 4. THE CIT, CONCERNED. 5. THE DR CONCERNED, MUMBAI 6. GUARD FILE BY ORDER TRUE COPY ASSTT. REGISTRAR, ITAT, MUMBAI