RAJ MOHAMMED IBRAHIM SHAIKH, MUMBAI V. ITO, 26(3)(1), MUMBAI

ITA 925/MUM/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6039 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 18-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K GUBGOTRA J
• Keywords: Bogus purchase; Set aside
• Section: 143(3); 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC, BENCH MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER ITA NO.925/MUM/2019 ( ASSESSMENT YEAR: 2009-10) RAJ MOHAMMED IBRAHIM SHAIKH, FLAT NO. 202, A-WING, DION SHELTER, NEHRU NAGAR, KURLA (E), MUMBAI-400024. VS. I.T.O.-23(3)(1), PRATYAKSHKAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI-400051. PAN/GIR NO.AMVPS 9664 D (APPELLANT ) .. (RESPONDENT ) ASSESSEE BY NONE REVENUE BY SHRI R.K. GUBGOTRA (JCIT-DR) DATE OF HEARING 06/02/2020 DATE OF PRONOUNCEMENT 14/02/2020 / O R D E R PER: R.C. SHARMA, A.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E EX PARTE ORDER DATED 30/07/2018 OF LD. CIT(A)-38, MUMBAI FOR THE A .Y. 2009-10 IN THE MATTER OF ORDER PASSED U/S 143(3) R.W.S. 147 OF THE INCOME TAX ACT, 1961 (IN SHORT, THE ACT). FOLLOWING GROUNDS HAVE BE EN TAKEN BY THE ASSESSEE: THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITIO N ON ACCOUNT OF ALLEGED BOGUS PURCHASE AMOUNTING TO RS.14,32,091/- (BEING 25 PERCENT OF RS.57,28,367/-) AND CONFIRMING DISPUTED DEMAND O F RS.8,02,050/-. THE LEARNED CIT(A) ERRED IN CONFIRMING ADDITION ON ACCOUNT OF UNPROVED PURCHASES TO THE EXTENT OF RS.14,32,091/- BEING 25 PERCENT OF ALLEGED SUSPICIOUS PURCHASES OF RS.57,28,367/- WITHOUT APPR ECIATING THAT THE PURCHASES ARE GENUINE AND ALL THE PAYMENT AGAINST S UCH PURCHASES ARE TA NO. 925/MUM/2019 RAJ MD. IBRAHIM SHAIKH VS ITO 2 MADE THROUGH BANKING CHANNELS AND IDENTITY CREDITOR S IS ESTABLISHED FURTHER SALES ARE NOT DOUBTED. THE LEARNED CIT(A) HAS ERRED IN HOLDING THE IMPUGNE D PURCHASES TO BE BOGUS, IN SPITE OF VOLUMINOUS EVIDENCES ON RECORD S IMPLY ON THE BASIS THAT THE CURRENT ADDRESSES OF VENDORS WERE NOT PROV IDED AND THE VENDORS WERE NOT PRODUCED BEFORE THE RESPONDENT, TH E ID. CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF RS.14,32,091/-MA DE BY THE RESPONDENT ON THE WRONGLY PREMISE THAT THE QUANTITA TIVE STOCK DETAILS WERE NOT PROVIDED. THE ID. CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF RS.14,32,091/- MADE BY THE RESPONDENT BY MAKING COMPARISON WITH AV ERAGE PROFITS AND AVERAGE RATIO OF MATERIAL PURCHASED AND HENCE T HE ADDITION CONFIRMED BY THE CIT(A) MAY BE DELETED. THE INTEREST CHARGED U/S. 234B AND 234C BEING CONSE QUENTIAL MAY KINDLY BE DELETED. 2. I HAVE GONE THROUGH THE ORDERS OF THE AUTHORITIE S BELOW AND FOUND THAT THE A.O. HAS REOPENED THE ASSESSMENT ON GETTIN G INFORMATION FROM THE SALES TAX DEPARTMENT REGARDING ASSESSEE TAKING ACCOMMODATION ENTRY FOR PURCHASE OF GOODS WITHOUT PHYSICAL DELIVE RY OF SAME. AFTER MAKING ENQUIRY, THE A.O. ADDED 25% OF ALLEGED BOGUS PURCHASES IN ASSESSEES INCOME. AGAINST THE ORDER OF THE A.O., T HE ASSESSEE APPROACHED TO THE LD. CIT(A) AND THE LD. CIT(A) DIS MISSED THE APPEAL EX PARTE. 3. FROM THE RECORD I FOUND THAT THE ASSESSE WAS SUF FERING FROM KIDNEY PROBLEM AND WAS TAKING TREATMENT FROM KEM HO SPITAL SINCE LAST 16 YEARS AND DURING THE RELEVANT PERIOD, THE ASSESS EE WAS OUT OF TOWN FOR TREATMENT FOR LAST THREE MONTHS. ACCORDINGLY, T HE ASSESSEE COULD NOT ATTEND THE HEARING AND NOT DEPUTED HIS REPRESENTATI VE TO APPEAR BEFORE TA NO. 925/MUM/2019 RAJ MD. IBRAHIM SHAIKH VS ITO 3 THE LD. CIT(A). THE LD. CIT(A) AFTER PASSING EX PAR TE ORDER DISMISSED THE APPEAL OF THE ASSESSEE. I FOUND THAT THERE WAS REAS ONABLE CAUSE FOR NON- APPEARANCE BEFORE THE LD. CIT(A). THEREFORE, IN THE SUBSTANTIAL INTEREST OF JUSTICE, WE SET ASIDE THE EX PARTE ORDER OF THE LD. CIT(A) AND MATTER IS RESTORED BACK TO HIM FOR DECIDING AFRESH AFTER PROV IDING DUE AND EFFECTIVE OPPORTUNITY OF HEARING TO THE ASSESSEE. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH FEBRUARY, 2020. SD/- (R.C.SHARMA) ACCOUNTANT MEMBER MUMBAI; DATED 14/02/2020 *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//