ACIT 9 (2)92), MUMBAI V. EXCEL REALITY N INFRA LTD., MUMBAI

MA 171/MUM/2022

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3039 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 29-08-2022
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 25-08-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 22-06-2022
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Bogus purchase

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER & SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER MA No. 171/Mum/2022 (in ITA No. 8017/Mum/2019) (Assessment Year: 2012-13) DCIT – 1(2)(1) Roo m No. 537, 5 t h Floo r Aayakar Bhavan MK Road, Mumbai – 400 020. बनाम/ Vs. M/s. Excel Realty N Infra Ltd., 3 1/A, Laxmi Indu strial Estate, New Link Road, Mu mbai . /ज आ इ आ र . /PAN/GI R No. : AABCE1172H ( /Appellant) . . ( / Respondent) Assessee by: Shri N.R. Agarwal.AR Revenue by: Shri Samuel Pitta - DR र / D a t e o f H e a r i n g 26/08/2022 !" र /D a t e o f P r o n o u n c e m e n t 29 /08/2022 आद श / O R D E R PER PAVAN KUMAR GADALE - JM: The revenue has filed the miscellaneous application (MA) seeking rectification of the Hon’ble Tribunal order in ITA No. 8017/Mum/2019 for the A.Y 2012-13 dated 28.09.2021. MA No. 171/Mum/2022 Excel Reality N infra Ltd., Mumbai. - 2 - 2. At the time of hearing, the Ld. DR submitted that the Hon’ble Tribunal while adjudicating the revenue appeal has dismissed the revenue appeal and in the assessee’s appeal, the Hon’ble Tribunal has restricted the addition to the extent @6% of the bogus purchases and partly allowed the assessee appeal and require clarifications on percentage sustained. 3. Whereas the Ld.AR submitted that the Hon’ble Tribunal has rightly considered the submissions of the assessee and restricted the addition to the extent of 6% and supported the order of the Honble Tribunal. 4. We heard the rival submissions and perused the material on record. The sole crux of the disputed issue as envisaged by the Ld. DR that the Hon’ble Tribunal has dismissed the revenue appeal, where the CIT(A) has sustained addition @ 12.5% of bogus purchases. We find that in the assessee appeal, the assessee has challenged the addition @ 12.5% in respect of bogus purchases, the Hon’ble Tribunal has considered the facts of the profit percentage in comparison to GP rate and granted relief and applicable for this assessment year only. The Hon’ble Tribunal has restricted the MA No. 171/Mum/2022 Excel Reality N infra Ltd., Mumbai. - 3 - profit element to the extent of 6% as against 12.5%. We considered it appropriate to refer to the findings of the Honble Tribunal at page 7 Para 7 of the order read as under: 7. The crux of the disputed issue as envisaged by the Ld.AR that the CIT(A) has restricted the addition to the extent of 12.5% of the bogus purchases considering profit element embedded. The Ld. AR emphasized that the addition of gross profit should be restricted to the G.P rate. We considering the facts and circumstances of the instant case are of the opinion that the gross profit rate disclosed in the financial statement is @3.25% and the assessee is in the Civil construction business and the margin of profit as mentioned by the Ld.AR is comparatively very much lower than 12.5% estimated by the CIT(A). Accordingly, to meet the ends of Justice, we restrict the profit percentage to 6% as against 12.5% and modify the order of the CIT(A). Further, we make it clear that this reduced percentage is applicable only to this Assessment year. 5. We make it clear that the Honble Tribunal has partly allowed the assessee appeal where the percentage of addition is restricted to 6%, and it is obvious that when the CIT(A) order is modified, the MA No. 171/Mum/2022 Excel Reality N infra Ltd., Mumbai. - 4 - percentage of relief granted shall also change for which the revenue has filed the appeal. Accordingly we do not find merits in the MA filed by the revenue and is dismissed accordingly.. Order pronounced in the open court on 29.08.2022 Sd/- Sd/- (S RIFAUR RAHMAN) (PAVAN KUMAR GADALE ) ACCOUTANT MEMBER JUDICIAL MEMBER Mumbai, Dated 29/08/2022. KRK, PS /Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A) 4. Concerned CIT 5. AR, ITAT, Mumbai 6. Guard file. BY ORDER, //True Copy// 1. ( Asst. Registrar) ITAT, Mumbai