M/S JAIN DIAMONDS PRIVATE LIMITED,MUMBAI V. INCOME TAX OFFICER-WARD 1(1)(3), MUMBAI

ITA 4548/MUM/2024

AI Insights

Jain Diamonds Pvt. Ltd. appealed against the order of the ld. CIT(A)-54, Mumbai, which was passed ex-parte, leading to the dismissal of the assessee's appeal due to lack of submissions and documentary evidence. The assessee contended that the order was passed without examining the material on record, which was furnished during the assessment proceedings. The Income Tax Officer had earlier made additions to the assessee's income on account of bogus purchases and commission based on the re-opening of the case, alleging that the assessee had obtained accommodation entries representing bogus purchases. The Tribunal found that the necessary submissions were not considered by the ld. CIT(A) and thus remitted the matter back for a thorough examination.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 33279 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 16-10-2024
• Assessment Year: 2010-2011
• Appeal Filed On: 05-09-2024
• Laws Referred To: Income-tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase; Bonafide belief; Accommodation entries; Bogus
• Section: 143(3); 22

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH MUMBAI BEFORE SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER ITA No. 4548/MUM/2024 Assessment Year: 2010-11 Jain Diamonds Pvt. Ltd., Office No.08, Ground Floor, Shreeji Arcade, Tata Road No.02, Opera House, Mumbai-400004 (PAN : AABCJ8950G) Vs. Income Tax Officer – Ward 1(1)(3), Mumbai (Assessee) (Respondent) Present for: Assessee : Shri Prakash Jotwani, Advocate Revenue : Ms. Rajeshwari Menon, Sr. DR Date of Hearing : 16.10.2024 Date of Pronouncement : 22.10.2024 O R D E R PER GIRISH AGRAWAL, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of Ld. CIT(A)-54, Mumbai vide order no. ITBA/APL/S/250/2024- 25/1066480362(1), dated 08.07.2024 passed against the assessment order by the Income Tax Officer, Ward 1(1)(3), Surat, u/s. 143(3) r.w.s. 147 of the Income-tax Act (hereinafter referred to as the “Act”), dated 26.12.2017 for Assessment Year 2010-11. 2 ITA No.4548/MUM/2024 Jain Diamonds Pvt. Ltd., AY 2010-11 2. In ground no.2, assessee has contended that an ex-parte order has been passed by ld. CIT(A) for which notices were sent to its Authorised Representative and was under a bonafide belief that its matter is being duly attended for effective representation. Assessee also contends that the impugned order has been passed ex parte without examining material on record which was furnished during the course of assessment proceedings. In this respect, we note that assessee is engaged in the business trading of gold and diamond jewellery. It filed its return of income on 26.09.2010 reporting total income at Rs.97,580/-. Based on information available with the Income Tax Department, case of the assessee was re-opened whereby it was alleged that assessee had obtained accommodation entries which represents bogus purchases. 2.1 Assessee had duly explained its case along with filing an objection on the re-opening proceedings, however, the assessment was completed by making following two additions:- i) Addition on account of bogus purchases – Rs.1,17,42,587/- ii) Addition on account of commission – Rs.1,66,96,271/- 3. Aggrieved, assessee went in appeal before the ld. CIT(A). However, it could not make its effective representation by filing required submissions along with documentary evidences in support of the claim made by it. Ld. CIT(A) thus observed that assessee has neither filed any submission in respect of the grounds raised before him nor filed any documentary evidences to explain the relief sought for and thus dismissed the appeal of the assessee. Aggrieved, assessee is in appeal before the Tribunal. 3 ITA No.4548/MUM/2024 Jain Diamonds Pvt. Ltd., AY 2010-11 4. A paper book containing 66 pages is placed on record to substantiate the claim of relief sought by the assessee. In respect of the ground raised before us as stated above, we perused the order of the ld. CIT(A) to take note of the fact that it has been dismissed for want of submissions and documentary evidences from the assessee. Before us, ld. Counsel for the assessee pleaded that an opportunity may be given to the assessee to make its representation for which an assurance was given that all the necessary submissions shall be made as and when called for. Ld. Sr. DR objected upon the plea so made. Considering the fact that assessee had made all the required submissions before the ld. Assessing Officer which were available on record and could have been considered by the ld. CIT(A), but not done so, in the interest of justice and fair play, we find it appropriate to remit the matter back to the file of ld. CIT(A) for denovo meritorious adjudication on the grounds of the appeal taken at the first appellate stage. We also direct the assessee to be diligent and cooperative in attending the hearings and make its submissions for expeditious and effective disposal of the appeal. It should not seek adjournments unless warranted by compelling reasons. 5 Since the matter is restored to the file of Ld. CIT(A) for meritorious adjudication by passing a speaking order in terms of our observations made hereinabove, we are not expressing any views on the merits of the case so as to limit the appellate procedure before the Ld. CIT(A). The observations herein made by us in remanding the matter back to the file of Ld. CIT(A) will not impair or injure the case of the Revenue nor will it cause any prejudice to the defense/explanation of the assessee. 4 ITA No.4548/MUM/2024 Jain Diamonds Pvt. Ltd., AY 2010-11 6. Accordingly, appeal of the assessee is allowed for statistical purposes. Order is pronounced in the open court on 22 October, 2024 Sd/- Sd/- (Rahul Chaudhary) (Girish Agrawal) Judicial Member Accountant Member Dated: 22 October, 2024 MP, Sr.P.S. Copy to : 1. The Assessee 2. The Respondent 3. DR, ITAT, Mumbai 4. 5. Guard File CIT BY ORDER, (Dy./Asstt.Registrar) ITAT, Mumbai "