POPATLAL N. SHAH, MUMBAI V. ASSISTANT COMMISSIONER OF INCOME TAX 19(2), MUMBAI

MA 399/MUM/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5850 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 24-04-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2012-2013
• Appeal Filed On: 30-05-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ABI RAMA KARTHIKE YEN
• Keywords: Bogus purchase

Judgement Text

P A G E | 1 M.A. 399/MUM/2018 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5939/MUM/2016) POPATLAL N. SHAH VS. ACIT - 19(2) IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE SHRI M.BALAGANESH , ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER M.A. NO. 399 /MUM/2018 (ARISING OUT OF ITA NO.5939/MUM/2016 ) (ASSESSMENT YEARS: 2011 - 12 ) POPATLAL N. SHAH 1802, PANCHRATNA, OPERA HOUSE, MUMBAI - 400004 VS. ACIT - 19(2) PAN AAAFP0468K (APPLICANT) (RESPONDENT) APPLICANT BY: SHRI AARTI VISSANJI , A.R RESPONDENT BY: SHRI ABI RAMA KARTHIKE YEN , D.R DATE OF HEARING: 08 .03.2019 DATE OF PRONOUNCEMENT: 2 4 .04.2019 O R D E R PER RAVISH SOOD, JM: THE PRESENT MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE ON 30.05. 2 0 18 ARISES FROM THE ORDER PASSED BY THE TRIBUNAL IN THE CASE OF POPATLAL N. SHAH VS. ACIT 19(2), MUMBAI IN ITA NO.5939/MUM/2016 FOR A.Y. 2012 - 13. 2. IN THE COURSE OF HEARING OF THE APPLICATION , IT WAS SUBMITTED BY THE LD. AUTHORIZED REPRESENTATIVE (FOR SHORT A.R) FOR THE ASSESSEE APPLICANT THAT THE TRIBUNAL WHILE CONFIRMING THE ADDITION @ 3% OF THE AGGREGATE VALU E OF THE PURCHASES WHICH THE ASSESSEE CLAIMED TO HAVE MADE FROM THREE CONCERNS VIZ. (I) MOHIT ENTERPRISES; (II) MAYUR P A G E | 2 M.A. 399/MUM/2018 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5939/MUM/2016) POPATLAL N. SHAH VS. ACIT - 19(2) EXPORTS; AND (III) PRIME STAR, HAD OMITTED TO CONSIDER THE FOLLOWING FACTS: 1. STATEMENT OF GP MARGIN ON SATE OF ALLEGED BOGUS TRANSACTION OF PURCHASES. NO CREDIT OF SUCH GP MARGIN HAS BEEN GRANTED WHILE COMPUTING ADDITION @ 6.18% OF ALLEGED BOGUS PURCHASES. 2. THOUGH PARAGRAPH 7 OF THE SAID ORDER REFERS TO THE REPORT OF THE TASK GROUP FOR DIAMOND SECTOR SUBMITTED TO DEPARTMENT OF COMMERCE WHEREIN THE NET PROFIT MARGIN IN DIAMOND MANUFACTURING AND TRADING WAS REPORTED IN THE RANGE OF 3% AND 2% RESPECTIVELY AND AL SO TO THE FACT THAT THE APPLICANT HAS CARRIED ON TRADING ACTIVITY IN POLISHED DIAMONDS IN RESPECT OF ALLEGED PURCHA SES THE ADDITION HAS BEEN MADE @ 3%. THE ADDITION COULD NOT HAVE BEEN HIGHER THAN 2% OF NET MARGIN. THE AP PLICANT S NET MARGIN DURING THE YEA R UNDER CONSIDERATION WAS 1.56%. 3. GP OF 5.91% OF THE APPELLANT HAS NOT BEEN CONSIDERED, FOR GRANT OF CREDIT WHILE ESTIMATING ADDITION @ 3% OF SUCH ALLEGED BOGUS PURCHASES. , AS A RESULT WHEREOF THE ORDER PASSED BY THE TRIBUNAL SUFFERS FROM A MISTAKE APPARENT FROM RECORD, WHICH THUS RENDERED THE SAME AMENABLE FOR RECTIFICATION UNDER SEC.254(2) OF THE INCOME TAX, 1961. 3. PER CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE (FOR SHORT D.R) OBJECTED TO THE APPLICATION FILED BY THE ASSESSEE. IT WA S SUBMITTED BY THE LD. D.R THAT AS NO MISTAKE DID EMERGE FROM THE ORDER PASSED BY THE TRIBUNAL, THUS, THE APPLICATION FILED BY THE ASSESSEE BEING DEVOID OF ANY FORCE WAS LIABLE TO BE DISMISSED. 4. WE HAVE HEARD THE AUTHORIZED REPRESENTATIVES FOR BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE ARE OF THE CONSIDERED VIEW THAT THE TRIBUNAL WHILE DISPOSING OFF THE CROSS APPEALS FILED BY THE ASSESSEE AND THE REVENUE FOR THE YEAR UNDER CONSIDERATION VIZ. A.Y. 2012 - 13 , HAD AFTER NECESSARY DELIBE RATIONS FOUND FAVOUR WITH THE VIEW TAKEN BY THE CIT(A) AND HAD UPHELD HIS ORDER . AS A RESULT THEREOF, THE ADDITIONS IN RESPECT OF THE PURCHASES CLAIMED BY THE ASSESSEE TO HAVE BEEN MADE FROM THE AFOREMENTIONED BOGUS CONCERNS P A G E | 3 M.A. 399/MUM/2018 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5939/MUM/2016) POPATLAL N. SHAH VS. ACIT - 19(2) VIZ. (I) MOHIT ENTERPRISES; (II ) MAYUR EXPORTS; AND (III) PRIME STAR WAS RESTRICTED BY THE TRIBUNAL TO 3% OF THE AGGREGATE VALUE OF SUCH PURCHA SES , AS AGAINST THAT ADOPTED BY THE A.O AT 12.5%. IN FACT, THE TRIBUNAL HAD AFTER GIVING THOUGHTFUL CONSIDERATION UPHELD THE VIEW TAKEN BY THE CIT(A) AND HAD RESTRICTED THE ADDITIONS TO THE EXTENT OF 3% OF THE AGGREGATE VALUE OF THE PURCHASES UNDER CONSIDERATION. IN OUR CONSIDERED VIEW THE ASSESSEE BY FILING THE PRESENT APPLICAT ION UNDER SEC. 254(2) OF THE I. T ACT IS SEEKING A REVIEW OF THE ORDER PASSED BY THE TRIBUNAL WHILE DISPOSING OFF HIS A PPEAL VIZ. POPATLAL N. SHAH VS. ACIT 19(2), MUMBAI (ITA NO. 5939/MUM/2016, DATED 08.11.2017). AS PER THE SETTLED POSITION OF LAW , THOUGH A MISTAKE WHICH IS GLARING, PATENT, APPARENT AND OBVIOUS FROM THE RECO RDS IS AMENABLE FOR RECTIFICATION UNDER SUB - SECTION (2) OF SEC.254 BY THE TRIBUNAL, HOWEVER, THE POWERS THEREIN VESTED CANNOT BE EXERCISED FOR ALLOWING A REVIEW OF THE ORDER. IN SUM AND SUBSTANCE, AS THE ASSESSEE IN THE CASE BEFORE US IS SEEKING A REVIEW O F THE ORDER PASSED BY THE TRIBUNAL WHILE D ISPOSING OFF ITS APPEAL, WHICH AS OBSERVED BY US IS NOT PERMISSIBLE IN THE EYES OF LAW, THEREFORE, THE APPLIC ATION FILED BY HIM DOES NOT MERIT ACCEPTANCE. 5. IN TERMS OF OUR AFORESAID OBSERVATIONS THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE STANDS DISMISSED. ORDER PRO NOUNCED IN THE OPEN COURT ON 2 4 . 04.2019 S D / - S D / - ( M.BALAGANESH ) (RAVISH SOOD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; 2 4 .04.2019 PS. ROHIT P A G E | 4 M.A. 399/MUM/2018 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5939/MUM/2016) POPATLAL N. SHAH VS. ACIT - 19(2) / 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 . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI