SMT. VIJAYLAXMI RAMESH UPADHYAY, MUMBAI V. ACIT-21(3), MUMBAI

MA 210/MUM/2020

• Counselvise Citation: [2020] 109 COUNSELVISE.COM (IT) 9332 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 22 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-12-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2009-2010
• Appeal Filed On: 25-09-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL DESH
• Assessee Lawyers: SATISH MODIA R
• Keywords: Bogus purchase

Judgement Text

IN THE INC OME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE SHRI S. RIFAUR RAHMAN, A M AND SHRI PAVAN KUMAR GADALE , J M M .A. NO . 210, 211 & 212/MUM/2020 ARISING OUT OF I.T.A. NO. 4402, 4403 & 4404/MUM/2018 (ASSESSMENT YEAR: 2009 - 10 TO 2011 - 12) SMT. VIJALAXMI RAMESH UPADHYAY, 36. GR. FLOOR, SAGAR PALLAZIO, OPP - SUDARSHAN HOTEL, ANDHERI KURLA ROAD, SAKINAKA, MUMBAI - 400 051 / VS. ACIT - 21(3), PRATYAKSHKAR BHAVAN, C - 11, 5 TH FLOOR, BANDRA KURLA COMPLEX, MUMBAI - 400 051 ./ ./ PAN NO. AAIPU8085F ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI SATISH MODI,AR / RESPONDENT BY : SHRI SUNIL DESHPANDE, DR / DATE OF HEARING : 11/12 /20 20 / DATE OF PRONOUNCEMENT : 17.12.2020 / O R D E R PER S. RIFAUR RAHMAN, ACCOUNTANT MEMBER : THE PRESENT THREE MISCELLANEOUS APPLICATI ON S HA VE BEEN FILED BY THE ASSESSEE FOR RECTIFYING THE ORDER DATED 26.02.20 PASSED IN ITA NO. 4402, 4403 & 4404/MUM/2018 AND FOR DISPOSING OF THE APPEAL ON MERITS. 2 M.A. NO. 210 TO 212/MUM/2020 SMT. VIJALAXMI RAMESH UPADHYAY 2 . AT THE OUTSET, LD. A R APP EARING ON BEHALF OF THE ASSESSEE BROUGHT TO OUR NOTICE PARA NO. 9 OF THE ITAT ORDER AND SUBMITTED THAT THE COORDINATE BENCH HAD RELIED THE CASE OF SUNIL B. VORANI (HUF) VRS. ITO (ITA NO. 1337/MUM/2017) AND CAME TO THE CONCLUSION TO SUSTAIN DISALLOWANCE @ 12.5% OF THE ALLEGED BOGUS PURCHASES. HE FURTHER SUBMITTED THAT THE HONBLE BOMBAY HIGH COURT IN THE CASE PCIT VRS. M/S MOHAMMAD HAJI ADA M & CO. HELD THAT ADDITION HAS TO BE RESTRICTED TO THE EXTENT OF GP RATE ON THE PURCHASES AT THE SAME RATE AS OTHER GENUINE PURCHASES. HE BROUGHT TO OUR NOTICE THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF ACIT VRS. SAURASHTRA KUTCH STOCK EXCHANGE (305 ITR 272), WHEREIN IT WAS HELD THAT THE TRIBUNAL HAD NOT CONSIDERED A JUDGMENT OF THE JURISDICTIONAL HIGH COURT AND THAT WAS A MISTAKE APPARENT FROM THE RECORD. HE SUBMITTED A CHAR T OF GP RATIO FOR THE HAWALA TRANSACTION AND GENUINE TRANSACTION BASED ON THE HONBLE JURISDICTIONAL HIGH COURT DECISION AND PRAYED THAT THE DISALLOWANCE MAY BE RESTRICTED BY FOLLOWING THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT. 3. ON THE OTHER HAN D THE LD. D R SUBMITTED THAT THE DECISION RELIED ON BY THE ASSESSEE AND ALL OTHER SIMILAR DECISIO N WERE UPHELD BY HONBLE HIGH COURT AND INVARIABLY, THE REVENUE HEAVILY RELIED ON THE DECISION OF HONBLE SUPREME COUT 3 M.A. NO. 210 TO 212/MUM/2020 SMT. VIJALAXMI RAMESH UPADHYAY IN THE CASE OF N. K. PROTEINS(SUPRA). HOW EVER, HE AGREED THAT THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IS APPLICABLE IN THE PRESENT CASE. 4. CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL PLACED ON RECORD. WE ARE IN AGREEMENT WITH THE SUBMISSION OF LD. AR THAT HONBLE JURISDICTIONAL HIGH COURT HAS DECIDED THE ISSUE ON BOGUS PURCHASES AND THEIR IMPACT ON THE PROFIT OF THE BUSINESS AND DISTINGUISHED THE PROFIT /GP EARNED BY THE THEM IN THE NORMAL COURSE OF BUSINESS AND IN THE TRANSACTION OF ALLEGED BOGUS PURCHASES. ON CAREFUL CONSIDERATION OF THE CHART SUBMITTED BY LD. AR, WE NOTICE THAT ASSESSEE HAS EARNED BENEFIT OF BOOKING HAWALA /BOGUS PURCHASED IN ORDER TO REDUCE THE PROFIT RANGE TO THE EXTENT OF 5% ON AN AVERAGE FOR 3 YEARS UNDER DISPUTE BEFORE US. THEREFORE, RESPECTFULLY FOLLOWING THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT, WE ARE INCLINED TO MODIFY THE DIRECTION GIVEN EARLIER IN PARA NO. 9 OF THE ORDER AND ACCORDINGLY, WE DIRECT THE AO TO DISALLOW 5% OF THE ALLEGED BOGUS PURCHASES INSTEAD OF 12.5% TO THAT EXTENT IN ALL THE APPE ALS UNDER WHICH, MISC. APPLICATIONS HAVE BEEN FILED . THEREFORE, IT IS RECTIFIED U/S 254 OF THE ACT AND ORDERED ACCORDINGLY. 5 . IN THE NET RESULT, ALL THE MISCELLANEOUS APPLICATION S FILED BY THE ASSESSEE STANDS ALLOWED . 4 M.A. NO. 210 TO 212/MUM/2020 SMT. VIJALAXMI RAMESH UPADHYAY ORDER PRONOUNCED IN THE OPEN COURT ON 12/12/ 2020. SD/ - SD/ - ( PA V AN KUMAR GADALE ) (S. RIFAUR RAHMAN ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 1 7 / 12 / 20 20 SR.PS DHANANJAY. / COPY OF THE ORDER FORWARDED T O : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F I LE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI