RAWASSA CONSTRUCTION, MUMBAI V. DCIT CEN CIR -9, MUMBAI

MA 363/MUM/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0490 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 29 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 23-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 24-06-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHTAR HANSARI
• Assessee Lawyers: S R LODHE
• Keywords: Bogus purchase
• Section: 191

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH D MUMBAI BEFORE SHRI PAWAN SINGH (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) M.A. NO. 363/MUM/2019 (ITA NO. 26/MUM/2016) ASSESSMENT YEAR: 2010 - 11 RAWASSA CONSTRUCTION, 638, GOURI HOUSE, TPS III, 8 TH RD., KHAR (W), MUMBAI - 400052. VS. DCIT CEN CIR - 9, MUMBAI 8 TH FLOOR, OLD CGO ANNEXE BLDG. M.K. ROAD MUMBAI - 400020. PAN NO. AAAFR6170N APPELLANT RESPONDENT ASSESSEE BY : MR. S.R. LODHE, AR REVENUE BY : MR. AKHTAR H. ANSARI , DR DATE OF HEARING : 27/09/2019 DATE OF PRONOUNCEMENT : 23/12/2019 ORDER PER N.K. PRADHAN, A.M. BY MEANS OF THIS MISCELLANEOUS APPLICATION (MA), THE APPLICANT SEEKS RECALL OF THE ORDER DATED 30.10.2018 PASSED BY THE ITAT D BENCH MUMBAI (ITA NO. 26/MUM/2016) FOR THE ASSESSMENT YEAR (AY) 2010 - 11. 2. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE REFERS TO THE WRITTEN SUBMISSION FILED DATED 24.06.2019 AND SUBMITS THAT THE FOLLOWING MISTAKES APPARENT FROM R ECORD ARE THERE IN THE PRESENT CASE: I. WHILE DECIDING THE APPEAL OF THE ASSESSEE, THE GROUND OF CROSS - EXAMINATION AND CONFRONTATION OF PARTIES INADVERTENTLY REMAINED TO BE DECIDED BY THE TRIBUNAL ; RAWASSA CONSTRUCTION MA NO. 363/MUM/2019 2 II. THE TRIBUNAL INADVERTENTLY CONFIRMED THE ADDITION AT 100% MADE BY THE AO, THOUGH DOCUMENTARY EVIDENCES WERE AVAILABLE ABOUT THE PURCHASE; III. THE TRIBUNAL INADVERTENTLY DID NOT DISCUSS THE ISSUE OF COMPLETION OF ASSESSMENT WITHOUT PROVIDING CROSS - EXAMINATION. 2.1 FURTHER IT IS STATED THAT , BEFORE THE TRIBUNAL THE A SSESSEE HAS RAISED THE FOLLOWING ISSUES : I. ADDITION OF RS.89,33,527/ - AS ALLEGED BOGUS PURCHASES, II. ADDITION OF RS.60,48,016/ - OUT OF INTEREST PAID AND III. NO ADDITION COULD HAVE BEEN MADE WITHOUT CONFRONTING THE MATERIAL AND ALSO IN NOT GIVING AN OPPORTUNITY TO CROSS - EXAMINE THE THIRD PARTIES ON THE STATEMENTS MADE BY THEM. 2.2 THE LD. COUNSEL SUBMITS THAT THOUGH A SPECIFIC GROUND WAS FILED ABOUT NOT PROVID ING CROSS - EXAMINATION BEFORE THE TRIBUNAL, BUT INADVERTENTLY THE SAME REMAINED TO BE ADJUDICATED. IT IS AGAIN STATED THAT NO ADDITION IS TO BE MADE WITHOUT CONFRONTING THE MATERIAL S AND ALSO IN NOT PROVIDING AN OPPORTUNITY TO CROSS - EXAMINE THE THIRD PARTI ES WHO HAVE GIVEN STATEMENTS BEFORE THE SALES TAX DEPARTMENT AGAINST THE ASSESSEE. FURTHER, IT IS SUBMITTED BY HIM THAT THE WRITTEN SUBMISSION FILED BY THE ASSESSEE DATED 27.04.2018 REFERRED DURING THE COURSE OF HEARING ON 24.08.2018 HAS NOT BEEN DEALT BY THE TRIBUNAL IN THE IMPUGNED ORDER. 2.3 THE LD. COUNSEL CONCLUDES THAT : I. THE TRIBUNAL ORDER DATED 30.10.2018 BE RECALLED AND THE AO BE DIRECTED TO GIVE OPPORTUNITY OF CROSS - EXAMINATION AND CONFRONTATION OF THE DOCUMENTS ON WHICH THE AO HAS RELIED UPON ; RAWASSA CONSTRUCTION MA NO. 363/MUM/2019 3 II. IN THE ALTERNATIVE, THE ADDITION MADE BY THE AO AT 100% BE RESTRICTED TO A REASONABLE FIGURE ; III. OR IN THE ALTERNATIVE, THE ASSESSMENT ORDER BE TREATED AS BAD IN LAW AND RESTORED THE MATTER TO THE AO FOR FRESH CONSIDERATION ON THE ISSUE ; IV. PASS ANY FURTHER ORDER, THE TRIBUNAL MAY DEEM FIT AND PROPER IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTATIVE (DR) SUBMITS THAT THERE IS NO MISTAKE APPARENT FROM RECORD AND THEREFORE, THE IMPUGNED ORDER PASSED BY THE TR IBUNAL NEED NO RECTIFICATION. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. IN THE INSTANT CASE, IN THE 1 ST GROUND OF APPEAL FILED ALONG WITH FORM NO. 36, THE APPELLANT HAS RAISED THE FOLLOWING GROUND: 1.2 THE LD. CIT(A) DID NOT APPRECIATE THAT NO ADDITION COULD HAVE BEEN MADE WITHOUT CONFRONTING THE MATERIAL AND ALSO IN NOT GIVING AN OPPORTUNITY TO CROSS - EXAMINE THE THIRD PARTIES ON THE STATEMENTS MADE BY THEM. WE FIND THAT THE BENCH HAS CONSIDERED THE ABOVE GROUND AND RELYING ON THE DECISION IN THE CASE OF DEVASAHAYA NADAR (T.) V. CIT 51 ITR 20 (MAD) AND MOTILAL PADAMPAT UDYOG V. CIT 293 ITR 565 (ALL) , DISCUSSED THE ABOVE GROUND AT LENGTH AT PAGE 24 - 26 OF THE IM PUGNED ORDER. FURTHER, WE FIND THAT THE BENCH HAS OBSERVED THAT AS PER RECORDS, THE AO HAD PROVIDED SUFFICIENT OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE ITS CLAIM FOR ESTABLISHING GENUINENESS OF PURCHASES MADE FROM THE THREE PARTIES NAMELY M/S MEETI TR ADE IMPEX, M/S NIKHIL ENTERPRISES AND M/S JIGNA ENTERPRISES TOTALLING TO RS.89,33,527/ - ; HOWEVER, THE ASSESSEE COULD NOT ESTABLISH THE GENUINENESS OF THE PURCHASES. FURTHER, IT IS OBSERVED IN THE IMPUGNED ORDER RAWASSA CONSTRUCTION MA NO. 363/MUM/2019 4 THAT SINCE ONUS WAS CAST ON THE ASSESSEE TO P ROVE THE GENUINENESS OF ANY CLAIM AND IT FAILED IT, THE AO RELYING ON THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF CIT V. CALCUTTA SALES AGENCY 19 ITR 191 (SC) HAS CORRECTLY HELD THAT THE ASSESSEE FAILED TO DISCHARGE ITS ONUS. SINCE THE ASSESSE E FAILED TO FURNISH ANY EVIDENCE IN THE FORM OF BILLS/INVOICES, DELIVERY CHALLANS, WEIGHING SLIP, LORRY RECEIPT, MATERIAL RECEIPT REGISTER IN SUPPORT OF ITS CLAIM OF PURCHASES, IT WAS HELD BY THE TRIBUNAL THAT THE ASSESSEE FAILED TO PROVE THAT IT ACTUALLY RECEIVED THE MATERIAL. THE BENCH FURTHER OBSERVED THAT IN THE INSTANT CASE PAYMENT BY ACCOUNT PAYEE CHEQUE IS NOT SUFFICIENT TO ESTABLISH THE GENUINENESS OF THE PURCHASE. RELYING ON THE DECISION IN INDIAN WOOLLEN CARPET FACTORY (2002) 178 CTR (RAJ) 420 A ND VISP (P.) V. CIT (2004) 186 CTR (MP ) 218, THE TRIBUNAL OBSERVED THAT THE ONUS LIES UPON THE ASSESSEE TO PROVE THE GENUINENESS OF PURCHASES AND IF THE INVESTIGATION DONE BY THE DEPARTMENT LEADS TO DOUBT IN RESPECT OF THE GENUINENESS OF THE TRANSACTION, T HEN IT IS INCUMBENT ON THE ASSESSEE TO PRODUCE THE PARTIES ALONG WITH NECESSARY DOCUMENTS IN ORDER TO ESTABLISH THE GENUINENESS OF THE TRANSACTION. ON THE BASIS OF ABOVE FACTS AND POSITION OF LAW, THE TRIBUNAL AFFIRMED THE ORDER OF THE LD. CIT(A). WE FIN D THAT THERE IS NO MISTAKE APPARENT FROM RECORD ON THE ABOVE ISSUES . A MISTAKE APPARENT ON THE RECORD MUST BE AN OBVIOUS MISTAKE AND NOT SOMETHING WHICH CAN BE ESTABLISHED BY A LONG DRAWN PROCESS OF REASONING ON POINTS ON WHICH THERE MAY BE CONCEIVABLY TWO OPINIONS. A DECISION ON A DEBATABLE POINT OF LAW IS NOT A MISTAKE APPARENT FROM THE RECORD. THIS VIEW IS SUPPORTED BY THE DECISION OF THE HONBLE SUPREME COURT IN T.S. BALARAM, ITO V. VOLKART BROS ., (1971) 82 ITR 50 (SC), MASTER RAWASSA CONSTRUCTION MA NO. 363/MUM/2019 5 CONSTRUCTION CO. P. LTD. V. STATE OF ORISSA , AIR 1966 SC 1047, KARAM CHAND THAPAR & BROS. (COAL SALES) LTD. V. STATE OF U.P. (1976) TAX LR 1921, 1927 (SC) AND CCE V. ASCU LTD ., (2003) 9 SCC 230, 232. THEREFORE, THERE IS NO MISTAKE APPARENT FROM RECORD ON THE ABOVE ISSUES. 4 .1 HOWE VER, WE FIND THAT THE WRITTEN SUBMISSION DATED 27.04.2018 WAS REFERRED DURING THE COURSE OF HEARING ON 24.08.2018. IT CONTAINS VAT ASSESSMENT ORDER FOR THE PERIOD 01/04/2009 TO 31/03/2010 RELEVANT TO THE ASSESSMENT YEAR 2010 - 11 PASSED BY THE ASST. COMMISSI ONER OF SALES TAX (INVESTIGATION) I - 21, MUMBAI . WE ARE OF THE CONSIDERED VIEW THAT NOT CONSIDERING THE ABOVE ASSESSMENT ORDER , FILED BY THE ASSESSEE, IS A MISTAKE APPARENT FROM RECORD. THEREFORE, WE RECALL THE IMPUGNED ORDER PASSED BY THE TRIBUNAL TO THE LIMITED EXTENT OF EXAMINING THE RELEVANCE/APPLICABILITY OF THE SAID VAT ASSESSMENT ORDER PASSED FOR THE AY 2010 - 11 AND DIRECT THE REGISTRY TO FIX THE CASE FOR HEARING BEFORE A REGULAR BENCH. 5. IN THE RESULT, THE MA IS RECALLED TO THE LIMITED EXTENT MENTIO NED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD DECEMBER, 2019 SD/ - SD/ - (PAWAN SINGH ) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 23.12.2019 RAHUL SHARMA, SR. P.S. RAWASSA CONSTRUCTION MA NO. 363/MUM/2019 6 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI