NAVKAR ENTERPRISES, MUMBAI V. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-3, THANE

MA 456/MUM/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8580 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 2 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 02-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D G
• Keywords: Bogus purchase; Rectification of order

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA ( A M) M.A. NO. 456/MUM/2018 ARISING OUT OF I.T.A. NO. 4722 /MUM/ 2017 (ASSESSMENT YEAR 20 07 - 08 ) M/S. NAVKAR ENTERPRISES BLOCK NO. 2A, JAI HIND BLDG. NO. 1, DR.A.M. ROAD BHULE SHWAR MUMBAI - 400 002. PAN : AAFFN6721J V S . ASST. CIT, CIRLE - 3 THANE. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY MS. RITIKA AGARWAL DEPARTMENT BY SHRI D.G. PANSARI DATE OF HEARING 18 . 1 . 201 9 DATE OF PRONOUNCEMENT 4 . 4 . 201 9 O R D E R BY WAY OF THIS MISCELLANEOUS APPLICATION THE ASSESSEE SEEKS RECTIFICATION OF MISTAKE IN THE ORDER OF THIS TRIBU NAL U/S. 254(2) OF THE I.T. ACT IN ITA NO. 4722/MUM/2017 FOR A.Y. 2007 - 08 VIDE ORDER DATED 5.2.2018 . SUBMISSIONS OF THE ASSESSEE ARE AS UNDER : - 2 . THE APPARENT ERRORS AND OMISSIONS ARE LISTED BELOW: - (I) FINDING THAT CONFIRMATION OF VENDORS NOT FURNISHED: IN PARA NO. 12 LINE NO. 9, IT HAS BEEN ERRONEOUSLY MENTIONED THAT APPLICANT HAS NOT BEEN ABLE TO PROVIDE ANY CONFIRMATION FROM ANY OF THE PA RTY. THIS MAY BE CORRECTED AS APPLICANT HAD SUBMITTED AFFIDAVIT OF PARTIES WHICH ARE FORMING PART OF THE PAPER BOOK ON PG. NOS. 72 TO 78, AND PG NOS. 100 TO 107. COPY OF INDEX AND AFFIDAVIT ARE ATTACHED HEREWITH AS EXHIBIT 'B', 'C(I)' AND 'C(II)'. ' THIS IS A MISTAKE APPARENT FROM RECORD. THEREFORE IT IS PRAYED THAT THIS LINE BE EXPUNGED. (II) GROUND NO.4 WAS NOT ADJUDICATED: 2 GROUND NO. 4 READS AS - 'BECAUSE, THE ID. CIT(A) HAS ERRED IN UPHOLDING THE VALIDITY OF THE REASSESSMENT ORDER IGNORING THE FACT THAT THE STATEMENT OF THIRD PARTY RELIED UPON BY THE RESPONDENT STOOD RETRACTED THROUGH AFFIDAVIT'. THE VENDOR PARTIES HAD FURNISHED AFFIRMING THE SALES MADE TO APPLICANT. THESE ARE APPEARING ON PGS.72 TO 78 AND 100 TO 107 OF THE PAPER BOOK FILED. THESE A FFIDAVITS SQUARELY REBUT THE STATEMENT RELIED UPON BY THE RESPONDENT. YET THIS GROUND WAS NOT ADJUDGED. THIS IS A MISTAKE APPARENT FROM RECORD. IT IS REQUESTED THAT THE IMPUGNED ORDER BE RECALLED TO A LIMITED EXTENT AND THIS GROUND BE ADJUDGED. (III) GROU ND NO. 5 WAS NOT ADJUDICATED GRO UND NO.5 READS AS BECAUSE, LEARNED CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF R S. 37,56,525 / - MADE BY THE RESPONDENT ON THE WRONG PREMISE THAT THE QUANTITATIVE STOCK DETAILS WERE NOT PROVIDED'. THIS IS A MISTAKE APPA RENT FROM RECORD AS QUANTITATIVE DETAILS OF THE TRANSACTION INVOLVING THE PARTIES AS WELL AS BALANCE TRANSACTIONS, WERE ON RECORD OF AUTHORITIES BELOW AND WERE ALSO FORMING PART OF PAPER BOOK ON PG. NO. 133 TO 135. COPY OF THE SAME IS ATTACHED HEREWITH AS EXHIBIT 'D'. IN ASSESSMENT ORDER ON PARA NO. 11.3 ON LINE NO. 9, IT IS MENTIONED THAT 'THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE FURTHER SUBMITTED QUANTITATIVE DETAILS SHOWING THE TRADING REFLECTING PURCHASES AND SALES OF ITEMS, CONFIRMATION FROM THE PARTIES....'. THEREFORE THE RESPONDENT HAD ALREADY ACCEPTED THE FACT THAT APPELLANT HAD SUBMITTED QUANTITATIVE STOCK DETAILS. COPY OF ASSESSMENT ORDER IS ATTACHED HEREWITH AS EXHIBIT 'E'. THEREFORE IT IS REQUESTED THAT THE IMPUGNED ORDER BE RECALLED TO A LIMITED EXTENT AND THIS GROUND BE ADJUDGED. (IV) ARGUMENT FOR CREDIT OF DECLARED GROSS PROFIT WERE NOT CONSIDERED: DURING THE COURSE OF HEARING, THE APPLICANT'S REPRESENTATIVE HAD SUBMITTED THAT THE APPLICANT HAS ALREADY SHOWN GROSS PROFIT OF 5.22% ON TH E IMPUGNED PURCHASES, IN THE AUDITED PROFIT & LOSS ACCOUNT. AS SUCH, WHILE SUSTAINING 12.5% GROSS PROFIT ADDITION, SUITABLE CREDIT MAY BE GRANTED. THIS ARGUMENT OF THE APPLICANT'S REPRESENTATIVE HAS NOT BEEN DEALT WITH WHICH IS A MISTAKE APPARENT FROM RECO RD. IT IS REQUESTED THAT THE IMPUGNED ORDER BE RECALLED TO A LIMITED EXTENT AND THIS ARGUMENT ALONG WITH RELEVANT DOCUMENTS MAY BE CONSIDERED. 3 (V) JUDGMENTS REFERRED TO DURING HEARING NOT ADVERTED TO: THE APPLICANT'S REPRESENTATIVE HAD RELIED UPON THE FO LLOWING JURISDICTIONAL JUDGMENTS DURING THE COURSE OF HEARING WHICH HAVE NOT BEEN CONSIDERED AND DEALT WITH, IN THE IMPUGNED ORDER: (A) M/S ASHISH INTERNATIONAL ITXA NO. 4299 OF 2009: 'ASSESSEE WAS NOT GIVEN ANY OPPORTUNITY TO CROSS EXAMINE THE CONC ERNED...... GENUINENESS OF THE STATEMENT HAS NOT BEEN ESTABLISHED BY ALLOWING CROSS EXAMINATION OF THE PERSON WHOSE STATEMENT WAS RELIED. DELETION OF ADDITION ON ACCOUNT OF BOGUS PURCHASES UPHELD. (B) M/S SPANCO LIMITED ITA NO. 1128/M/2012: 'THE ASSESSEE M/S SPANCO LIMITED HAS ASKED FOR THE CROSS EXAMINATION WHICH WAS DENIED BY THE AO. WE ARE OF THE VIEW THAT THE ID. CIT(A) IT WAS UNEQUIVOCALLY HELD IN THESE JUDGMENTS THAT, IN THE ABSENCE OF OPPORTUNITY OF CROSS - EXAMINATION, THE ASSESSMENT ORDER WAS RENDE RED INVALID. THE FAILURE TO DEAL WITH JUDGMENTS RELIED UPON DURING COURSE OF HEARING IS MISTAKES APPARENT FROM RECORD AS HELD IN ORDER DT: 18/11/2016 OF RELIANCE COMMUNICATIONS LTD VS. DDIT (ITAT MUMBAI). RELEVANT EXTRACT IS REPRODUCED: 'ACCORDINGLY, WE H OLD THAT THE IMPUGNED ORDER PASSED SUFFERS FROM MISTAKE APPARENT FROM RECORD ON ACCOUNT OF NON - CONSIDERATION OF THE DECISION RENDERED BY CO - ORDINATE BENCH ON IDENTICAL ISSUE'. IT IS REQUESTED THAT THE IMPUGNED ORDER BE RECALLED TO A LIMITED EXTENT AND THE APPLICABILITY OF THESE JUDGMENTS BE CONSIDERED . 4. F ROM THE ABOVE I FIND THAT ITAT HAS ERRONEOUSLY MENTIONED THAT THE ASSESSEE HAS NOT BEEN ABLE TO PROVIDE ANY CONFIRMATION FROM ANY OF THE PARTIES. THE ABOVE SUBMISSION OF THE ASSESSEE IS CORRECT IN AS M UCH AS WHILE DRAWING ADVERSE INFERENCE OF THE ASSESSEE, THE TRIBUNAL MENTIONED THAT THE ASSESSEE HAS NOT PROVIDE ANY CONFIRMATION FROM THE SUPPLIERS. THIS IS CONTRARY TO THE RECORDS. AS THIS IS A MISTAKE APPARENT FROM RECORD. I RECALL THE AFORESAID ORDER O F THE TRIBUNAL FOR ADJUDICATING AFRESH. I DIRECT THE REGISTRY TO FIX THE DATE FOR HEARING OF THIS CASE AFRESH IN NORMAL COURSE. 5. IN THE RESULT, MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE STANDS ALLOWED. 4 ORDER HAS BE EN PRONOUNCED IN THE COURT ON 4 . 4 . 201 9 . SD/ - (SH A MIM YAHYA ) ACCOUNTANT MEMBER MUMBAI ; DATED : 4 / 4 / 20 1 9 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// ( SENIOR P RIVATE S ECRETARY ) PS ITAT, MUMBAI