M/S STAR BRILLIAN, MUMBAI V. ASSTT. CIT -19(3), MUMBAI

MA 302/MUM/2022

AI Insights

The case involves Star Brillian, the applicant, who filed Miscellaneous Applications under section 254(2) of the Income Tax Act, 1961, seeking rectification of the Tribunal's earlier order which allegedly omitted to decide several grounds raised in their appeals for the assessment years 2009-10 and 2013-14. The Tribunal had previously decided these appeals in a consolidated manner but did not address specific grounds related to the assessment and natural justice principles. The Department opposed the applications, arguing that all grounds were decided collectively. However, the Tribunal acknowledged the oversight and scheduled a re-hearing for the unaddressed grounds.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 133777 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 2 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-09-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: E
• Next Hearing Date: 21-09-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 19-10-2022
• Other Referred Cases: Datamatics Ltd. v/s ACIT, Mumbai Mazdoor Sabha v/s DCIT Cen Cir 43, Mumbai
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PANKAJ MEHTA
• Assessee Lawyers: MEHUL N. SHAH
• Keywords: Bogus purchase; Principle of natural justice; Opportunity of cross examination; Validity of assessment
• Section: 143(3); 234B

Judgement Text

आयकर अपीलीय अिधकरण मुंबई पीठ “ई ”, मुंबई 炈ी िवकास अव瀡थी, 瀈याियक सद瀡य एवं 炈ी अमरजीत 琐सह, लेखाकार सद瀡य के सम楹 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “ E ”, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI AMARJIT SINGH, ACCOUNTANT MEMBER MA NO.301 AND 302/MUM/2022 [Arising out of ITA No.1551 AND 1552/Mum/2020, A.Y.2009-10 & 2013-14] Star Brillian, FW 1011, Bharat Diamond Bourse, Bandra Kurla Complex, Bandra (E),Mumbai – 400 051 PAN: AAAFS-3628-J ..... 灹ाथ牸 /Applicant बनाम Vs. Income Tax Officer 19(3)(4), 2 nd Floor, Matru Mandir, Tardeo Road, Mumbai – 400 007 ..... 灹ितवादी/Respondent Assessee by : Shri Mehul N. Shah (Partner in Assessee firm – in person) Revenue by : Shri Pankaj Mehta सुनवाई क琉 ितिथ/ Date of hearing : 22/09/2023 घोषणा क琉 ितिथ/ Date of pronouncement : 22/09/2023 आदेश / ORDER PER VIKAS AWASTHY, JM: These Miscellaneous Applications have been filed by the assessee u/s. 254(2) of the Income Tax Act, 1961 [in short ‘the Act’] seeking rectification in the Tribunal order dated 12/07/2022 vide which ITA No.1551/Mum/2020 for assessment year 2009-10 and ITA No.1552/Mum/2020 for assessment year 2013-14 were decided. 2 MA NO.301 AND 302/MUM/2022 [Arising out of ITA No.1551 AND 1552/Mum/2020, A.Y.2009-10 & 2013-14] 2. Shri Mehul N.Shah (Partner in the assessee firm – in person) submitted that the Tribunal while deciding the appeals have failed to decide some of the grounds raised in the appeals. He pointed that at the time of arguments the ld. Authorized Representative of the assessee stated that ground No.1 is not pressed, however, the Tribunal failed to decide ground No. 2 to 7 of the appeal in ITA No.1551/Mum/2020 for assessment year 2009-10. Similarly, in ITA No.1552/Mum/2020 for assessment year 2013-14, ground No.2 to 6 of the appeal remain to be decided. Non-disposal of grounds of appeal is a mistake apparent from record that requires to be rectified. 3. Per contra, Shri Pankaj Mehta representing the Department strongly opposed the miscellaneous applications filed by the assessee. He submitted that a perusal of the Tribunal order dated 12/07/2022 would show that the Tribunal has decided all the grounds in a consolidated manner instead of deciding each and every ground separately. He submitted that there is no mistake in the order of Tribunal, hence, the miscellaneous applications should be dismissed. 4. We have heard the submissions made by rival sides. The appeals of the assessee in ITA No.1551/Mum/2020 for assessment year 2009-10 and in ITA No.1552/Mum/2020 for assessment year 2013-14, were decided by the Tribunal vide common order dated 12/07/2022. During the course of hearing of appeal, ground No.1 raised in appeal for assessment year 2009-10 challenging validity of reassessment was not pressed by the ld. Authorized Representative of the assessee, the same was dismissed accordingly. In ground No.2 the assessee had assailed the addition made on estimations @ 3% in respect of bogus purchases. The Tribunal restricted the addition to 2% of 3 MA NO.301 AND 302/MUM/2022 [Arising out of ITA No.1551 AND 1552/Mum/2020, A.Y.2009-10 & 2013-14] the alleged bogus purchases. On perusal of grounds of appeal for assessment year 2009-10 we find that ground No.3 to 6 of the appeal were on peripheral issues challenging validity of assessment on principles of natural justice. The ground No.7 of appeal is with regard to levy of interest u/s. 234B of the Act. While disposing of the appeal, findings were given on only ground No.2 of appeal. The issues raised in ground No.3 to7 of appeal, remained to be adjudicated. This is a mistake apparent on record that needs to be rectified. 5. Similarly, while deciding the appeal of assessee for the assessment year 2012-14 in ITA No.1552/Mum/2020 for assessment year 2013-14, the findings were given only with respect to ground No.1, restricting addition on bogus purchases to 2%. The ground No.2 to 6 of appeal, remained to be adjudicated. Thus, there was a mistake in not adjudicating the aforesaid grounds of appeal in assessment year 2013-14 as well. 6. The order dated 12/07/2022, common for assessment year 2009-10 and 2013-14 is recalled for adjudicating grounds No.3 to 7 in ITA No.1551/Mum/2020 for assessment year 2009-10. The relevant grounds are reproduced herein below: “ 3. The Learned CIT(A)-59, Mumbai erred in facts and in law in ignoring the fact that copy of any information / statements / details / evidences in possession of or relied upon by the Id. AO including the alleged statement dated 11.10.2013 was not supplied to the appellant. 4. The ld.CIT(A)-59, Mumbai erred in facts and in law in ignoring the fact that the Id.AO did not provide any opportunity of cross examination of the persons who had allegedly admitted that the appellant had made non genuine purchase of Rs. 9,74,86,9647- from them. He overlooked the blatant violation of principles of natural justice and has not adjudicated the issue while deciding the appeal. 4 MA NO.301 AND 302/MUM/2022 [Arising out of ITA No.1551 AND 1552/Mum/2020, A.Y.2009-10 & 2013-14] 5. The learned assessing officer and learned CIT(A) 59 erred in facts and in law in not providing any proof as to how the assessee or the suppliers are related to the various persons or addresses as mentioned in the assessment order. 6. The ld.CIT(A)-59, Mumbai erred in facts and in law in disregarding the documentary evidences submitted by assessee to show the genuineness of purchase including confirmation, affidavit of genuineness and bank statements of the alleged parties and treating the same as bogus based on surmises and conjectures. 7. The Learned Assessing Officer erred in law and on facts in levying Interest under section 234B without appreciating the fact that since the original assessment was done u/s 143(3) the interest u/s 234B is not applicable as held by Mumbai ITAT in the case of Datamatics Ltd. v/s ACIT 299 ITR(AT) 286 (Mumbai) which was also followed in Mumbai Mazdoor Sabha v/s DCIT Cen Cir 43, Mumbai ITA No. 1371/Mum/2013 decision dated 08.11.2016. Learned CIT(A) 59 erred in not considering and granting relief on this ground.” For the assessment year 2013-14, the following grounds that remained to be adjudicated are reproduced herein below: “ 2. The Learned CIT(A)-59, Mumbai erred in facts and in law in ignoring the fact that copy of any information / statements / details / evidences in possession of or relied upon by the ld. AO including the alleged statement dated 11.10.2013 was not supplied to the appellant. 3. The ld.CIT(A)-59, Mumbai erred in facts and in law in ignoring the fact that the ld.AO did not provide any opportunity of cross examination of the persons who had allegedly admitted that the appellant had made non genuine purchase of Rs. 29,53,36,678/- form them. He overlooked the blatant violation of principles of natural justice and has not adjudicated the issue while deciding the appeal. 4. The ld.CIT(A)-59, Mumbai erred in facts and in Jaw in not providing any proof as to how the purchases made by the appellant are related to the Bhanwarlal Jain Group as alleged by the ld. AO and not considering the fact that the alleged suppliers had retracted his statement. 5. The ld.CIT(A)-59, Mumbai erred in facts and in law in disregarding the documentary evidences submitted by assesses to show the genuineness of purchase including confirmation, affidavit of genuineness and bank statements of the alleged parties and treating the same as bogus based on surmises and conjectures. 6. The learned assessing officer and CIT(A)-59, Mumbai erred in initiating penalty u/s 271(l)(c) inspite of the fact that the addition is only on estimation basis and 5 MA NO.301 AND 302/MUM/2022 [Arising out of ITA No.1551 AND 1552/Mum/2020, A.Y.2009-10 & 2013-14] therefore there is neither concealment nor furnishing of inappropriate particulars of income.” 7. The Miscellaneous Applications filed by the assessee are partly allowed. The Registry is directed to fix the appeals for adjudication of aforementioned grounds before regular Bench on 30/10/2023. Since, date of hearing of the appeals has been pronounced in the open court in presence of both sides, issuance of notice to the parties is dispensed with. 7. In the result, the Miscellaneous Applications are partly allowed. Order pronounced in the open Court on Friday the 22 nd day of September, 2023 Sd/- Sd/- (AMARJIT SINGH) (VIKAS AWASTHY) लेखा सद瀡य/ACCOUNTANT MEMBER 瀈याियक सद瀡य/JUDICIAL MEMBER मुंबई/ Mumbai, 琈दनांक/Dated 22/09/2023 Vm, Sr. PS(O/S) 灹ितिलिप अ灡ेिषत 灹ितिलिप अ灡ेिषत灹ितिलिप अ灡ेिषत 灹ितिलिप अ灡ेिषतCopy of the Order forwarded to : 1. अपीलाथ牸/The Appellant , 2. 灹ितवादी/ The Respondent. 3. The PCIT 4. िवभागीय 灹ितिनिध, आय.अपी.अिध., मुबंई/DR, ITAT, Mumbai 5. गाड榁 फाइल/Guard file. BY ORDER, //True Copy// (Dy./Asstt. Registrar) ITAT, Mumbai