SHRI. GHANSHYAMDAS ADVANI, ULHASNAGAR V. ITO WARD 2(1), KALYAN

ITA 83/MUM/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8490 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 07-01-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AKHTAR HANSARI
• Keywords: Bogus purchase
• Section: 143(3); 44AB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC, BENCH MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER ITA NO.82 & 83/MUM/2019 ( ASSESSMENT YEAR: 2010-11 & 2011-12) SHRI GHANSHYAMDAS ADVANI, PROP. OF MAHADEV ENTERPRISES PLOT NO. 234, B.K. NO. 144 & 145, ULHASNAGAR, PIN-421001 VS. I.T.O., WARD 2(1), KALYAN, 2 ND FLOOR, MOHAN PLAZA, WAYALE NAGAR, KHADAKPADA, KALYAN (W), PIN-421301. PAN/GIR NO.AAQPA 7566 F (APPELLANT ) .. (RESPONDENT ) ASSESSEE BY NONE REVENUE BY SHRI AKHTAR H ANSARI (DR) DATE OF HEARING 13/01/2020 DATE OF PRONOUNCEMENT 20/01/2020 / O R D E R PER: R.C. SHARMA, A.M. THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS OF LD. CIT(A)-03, THANE DATED 19/04 /2018 FOR THE A.Y. 2010-11 & 2011-12 IN THE MATTER OF ORDER PASSED U/S 143(3) R.W.S 147 OF THE INCOME TAX ACT, 1961 (IN SHORT, THE ACT). 2. NO BODY HAS APPEARED ON BEHALF OF THE ASSESSEE I N SPITE OF SERVICE OF NOTICE, THE BENCH, THEREFORE, DECIDED TO DISPOSE OFF THE APPEALS AFTER HEARING THE LD. DR AND THE CONSIDERIN G MATERIAL PLACED ON RECORD. ITA NO. 82 & 83/MUM/2019 SHRI GHANSHYAMDAS ADVANI VS ITO 2 3. I HAVE CONSIDERED THE CONTENTION OF THE LD DR AN D CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. F ROM THE RECORD I FOUND THAT ON THE BASIS OF INFORMATION FROM THE SAL ES TAX DEPARTMENT, THE A.O. REOPENED THE ASSESSMENT AND THEREAFTER MAD E 100% ADDITION IN RESPECT OF ALLEGED BOGUS PURCHASES. 4. BY PASSING EX PARTE ORDER, THE LD. CIT(A) HAS CO NFIRMED THE ACTION OF THE A.O. FROM THE RECORD, I FOUND THAT TH E ASSESSEE WAS CARRYING ON THE PROPRIETORY BUSINESS UNDER THE NAME AND STYLE OF M/S MAHADEV ENTERPRISES ENGAGED IN THE BUSINESS OF TRAD ING OF ELECTRONIC APPLIANCES. DURING THE RELEVANT FINANCIAL YEARS, RE GULAR BOOKS OF ACCOUNT WERE MAINTAINED BY THE ASSESSEE AND SAME WE RE SUBJECTED TO TAX AUDIT U/S 44AB OF THE ACT. IN THE A.Y. 2010-11, THE ASSESSEE HAS DECLARED GROSS PROFIT OF 19.01% AND N.P. OF 5.04% O N GROSS RECEIPTS OF RS. 81,11,444/-. IN THE A.Y. 2011-12, THE ASSESS EE HAS DECLARED G.P. OF 16.76% AND N.P. OF 5.04% ON GROSS RECEIPT O F RS. 1,12,92,914/-. 5. DURING THE RELEVANT ASSESSMENT YEARS, THE ASSESS EE HAD PURCHASED PVC COMPOUNDS OF RS. 1,24,800/- AND RS. 6 ,72,525/- FROM M/S S.S. ENTERPRISES DURING F.Y. 2009-10 AN 2010-11 RESPECTIVELY. ITA NO. 82 & 83/MUM/2019 SHRI GHANSHYAMDAS ADVANI VS ITO 3 6. BEFORE THE A.O., THE ASSESSEE HAS FILED FOLLOWIN G DOCUMENTS SO AS TO SUBSTANTIATE THE GENUINENESS OF THE PURCHASES : (A) LEDGER COPY OF S.S. ENTERPRISES FOR THE FINANCI AL YEAR 2009-10, ANNEXURE-B. (B) PURCHASE INVOICES ALONGWITH RELEVANT TRANSPORT RECEIPTS FROM S.S. ENTERPRISES, ANNEXURE-C1-C2. (C) BANK OF BARODA BANK STATEMENT REFLECTING THE PA YMENTS MADE TO SUPPLIER M/S S.S. ENTERPRISES, ANEXURE-D1. THIS IS TO APPRECIATE THAT THE ASSESSEE HAD DULY MADE THE PAYMENT TO SUPPLIER M/S S.S. ENTERPRISES TROUGH ACC OUNT PAYEE CHEQUE. (D) COPY OF TAX AUDIT REPORT FOR A.Y. 2010-11, ANNE XURE-E1- E19. (E) COMPARATIVE CHART OF G/P AND N/P FOR THE FIVE F INANCIAL YEARS, ANNEXURE-F. HOWEVER, THE A.O. DID NOT AGREE WITH THE CONTENTION OF THE ASSESSEE AND ADDED 100% OF SUCH ALLEGED BOGUS PURCHASES IN A SSESSEES INCOME. CONSIDERING VARIOUS DOCUMENTS FILED BEFORE THE LOWER AUTHORITIES , THE G.P. DECLARED BY THE ASSESSEE IN THE RESPECTIVE YEARS, THE JUDICIAL PRONOUNCEMENTS ON THIS ISSUE AND THE F ACTS AND CIRCUMSTANCES OF THE CASE, I DO NOT FIND ANY MERIT IN 100% OF THE ADDITION. KEEPING IN VIEW THE NATURE OF ASSESSEES BUSINESS, I DIRECT THE A.O. TO RESTRICT THE ADDITION TO THE EXTENT OF 15% OF THE ALLEGED PURCHASES IN BOTH THE YEARS UNDER CONSIDERATION. ITA NO. 82 & 83/MUM/2019 SHRI GHANSHYAMDAS ADVANI VS ITO 4 7. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED IN PART. ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH JANUARY, 2020. SD/- (R.C.SHARMA) ACCOUNTANT MEMBER MUMBAI; DATED 20/01/2020 *RANJAN COPY OF THE ORDER FORWARDED TO : BY ORDER, (ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//