RASHMI ANURAG TIBEREWALA, MUMBAI V. INCOME TAX OFFICER 24(3)(5), MUMBAI

MA 715/MUM/2017

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6487 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 01-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N HEMLATHA
• Assessee Lawyers: PIYUSH CHAJJED
• Keywords: Bogus purchase

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) M.A. NO. 715/MUM/2017 ARISING OUT OF I.T.A. NO. 413 /MUM/ 2017 (ASSESSMENT YEAR 20 09 - 10 ) MS. RASHMI ANURAG TIBREWALA PROP. M/S. VESHAR INDUSTRIES 6, J.B. NAGAR, A.K. ROAD 1 ST FLOOR, ANDHERI EAST MUMBAI - 400 059. PAN : AANPK5286F V S . ITO 24(3)(5) MUMBAI. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY SHRI PIYUSH CHAJJED DEPARTMENT BY MS. N. HEMLATHA DATE OF HEARING 6.4. 201 8 DATE OF PRONOUNCEMENT 20 . 4 . 201 8 O R D E R THE ASSESSEE HAS FILED THIS MISCELLANEOUS APPLICATION WITH THE PLEA TO RECTIFY THE MISTAKE S APPARENT FROM RECORD IN THE ORDER DATED 7.6.2017 PASSED IN ITA NO. 413/MUM/2017. 2. LEARNED AR SUBMITTED THAT THE ISSUE UNDER CONSIDERATION OF THE TRIB UNAL IN THE APPEAL OF THE ASSESSEE WAS RELATED TO THE ADDITION MADE ON ACCOUNT OF ALLEGED BOGUS PURCHASES MADE FROM HAWALA DEALERS IDENTIFIED BY THE SALES TAX DEPARTMENT. THE ASSESSING OFFICER HAD ADDED 12.5% OF THE VALUE OF ALLEGED BOGUS PURCHASES AND THE SAME WAS CONFIRMED BY THE LEARNED CIT(A). THE TRIBUNAL HAS REDUCED THE SAME TO 9%. 3. THE LEARNED AR SUBMITTED THAT THE ASSESSEE HAS BEEN DECLARING GROSS PROFIT RATE OF 9.75% ON SALES, WHICH WORKED OUT TO 11.15% ON PURCHASES. IF THE GP RATE OF 9% SUSTAIN ED BY THE TRIBUNAL IS INCLUDED, GP RATE WORKED OUT TO AROUND 20.15% , WHICH IS NOT AVAILABLE IN THE TRADE. HE SUBMITTED THAT THE ASSESSEE HAS BROUGHT THESE FACTS BEFORE THE TRIBUNAL AND ACCORDINGLY PLEADED FOR SET OFF OF GP DECLARED BY THE ASSESSEE IN THE B OOKS OF ACCOUNT AGAINST GP MS. RASHMI ANURAG TIBREWALA 2 ESTIMATED BY THE ASSESS ING OFFICER . HOWEVER THE TRIBUNAL DID NOT CONSIDER THE SAID REQUEST AND HAS PROCEEDED TO SUSTAIN THE ADDITION TO THE EXTENT OF 9% AND THE SAME HAS RESULTED IN A MISTAKE APPARENT FROM RECORD. 4. THE LEARNE D AR FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAD ESTIMATED GP RATE ON THE PURCHASE VALUE AT ` 169.36 LAKHS, THE SAID AMOUNT INCLUDE D VAT AMOUNT OF ` 18.55 LAKHS . HENCE VALUE OF NET PURCHASE WA S ONLY ` 150.81 LAKHS. HENCE GP SHOULD HAVE BEEN ESTIMATED ON ` 150.81 LAKHS ONLY AND IN THIS REGARD THE ASSESSEE HAS RAISED A SPECIFIC GROUND AS GROUND NO. 5 IN THE APPEAL FILED BEFORE THE TRIBUNAL. HOWEVER, THE SAID GROUND HAS NOT BEEN DISPOSED OF AND THE SAME CONSTITUTE A MISTAKE APPARENT FROM RECORD. THE 5. THE LEARNED AR FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS PLACED RELIANCE ON THE STATEMENT GIVEN BY THE ALLEGED HAWALA DEALERS BEFORE THE SALES TAX AUTHORIT IES FOR MAKING THE IMPUGNED ADDITIONS . HOWEVER, THE ASSESSING OFFICER DID NOT PROVIDE AN OP PORTUNITY TO CROSS EXAMINE THOSE DEALERS. THE LEARNED AR SUBMITTED THAT THE IMPUGNED ADDITION MADE BY THE ASSESSING OFFICER SHOULD HAVE BEEN DELETED BY THE TRIBUNAL ON THE GROUND THAT OPPORTUNITY TO CROSS EXAMINE THE DEALERS HA S NO T BEEN PROVIDED TO THE AS SESSEE AND THE SAME CONSTITUTES MISTAKE APPARENT FROM RECORD. 6 . ON THE CONTRARY, LEARNED DR SUBMITTED THAT THE TRIBUNAL HAS PASSED THE IMPUGNED ORDER AFTER CONSIDERING ALL MATERIALS AVAILABLE ON RECORD AND THE REQUEST MADE BY THE ASSESSEE IN THE MISCELLA NEOUS APPLICATION WOULD LEAD TO REVIEW OF THE ORDER PASSED BY THE TRIBUNAL, WHICH IS NOT PERMISSIBLE U/S. 254(2) OF THE ACT. 7 . I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. I FIND MERIT IN THE SUBMISSIONS OF LEARNED DR. I NOTICED THAT THE TR IBUNAL HAS CONSIDERED ALL THE CONTENTIONS OF THE ASSESSEE AND ACCORDINGLY TAKEN THE VIEW ON THE ISSUES URGED BY THE ASSESSEE. THE VARIOUS SUBMISSIONS MADE BY THE ASSESSEE AS WELL AS THE REVENUE WITH REGARD TO QUANTUM OF GROSS PROFIT HAS BEEN CONSIDERED BY MS. RASHMI ANURAG TIBREWALA 3 THE TRIBUNAL AND IT HAS SUSTAINED ADDITION TO THE EXTENT OF 9% OF THE VALUE OF ALLEGED BOGUS PURCHASES. HENCE THE PRESENT REQUEST OF THE ASSESSEE WOULD LEAD TO REVIEW OF THE ORDER PASSED BY THE TRIBUNAL AND THE SAME IS NOT PERMISSIBLE UNDER SECTION 254(2 ) OF THE ACT. 8 . WITH REGARD TO THE CONTENTION OF THE ASSESSEE THAT THE OPPORTUNITY TO CROSS EXAMINATION WAS NOT GIVEN, I NOTICED THAT THE ASSESSING OFFICER HAS NOT PLACE RELIANCE ON THE ADMISSION MADE BY THE HAWALA DEALERS BEFORE THE SALES TAX AUTHORIT I ES FOR MAKING IMPUGNED ADDITION AND INSTEAD PROCEEDED TO EXAMINE GENUINENESS OF PURCHASES INDEPENDENTLY. HENCE IT CANNOT BE SAID THAT THE ADDITION WAS MADE BY THE AO ONLY ON THE BASIS OF ADMISSION MADE BY THE HAWALA DEALERS BEFORE THE SALES TAX AUTHORITIE S. HENCE, I DO NOT FIND ANY M ERIT IN THE SAID CONTENTION OF THE ASSESSEE. 9 . HOWEVER, WE FIND MERIT IN THE CONTENTION OF THE ASSESSEE THAT GROUND NO. 5 OF THE APPEAL FILED BY THE ASSESSEE WAS NOT ADJUDICATED. SINCE, GROUND NO. 5 OF THE ASSESSEE HAS NOT BE EN DISPOSED OF, THE SAME IS BEING DISPOSED OF BELOW BY ADDING FOLLOWING PARAGRAPH AS PARAGRAPH 8 IN THE IMPUGNED ORDER : 8) THE ASSESSEE HAS URGED THAT THE VALUE OF ALLEGED BOGUS PURCHASES WAS ONLY 150.81 LAKHS AND NOT ` 169.36 LAKHS AS ADOPTED BY THE ASS ESSING OFFICER. IT WAS SUBMITTED THAT THE VALUE OF ` 169.36 LAKHS INCLUDES VAT TAX TO THE EXTENT OF ` 18.55 LAKHS. ACCORDINGLY, IT WAS SUBMITTED THAT THE GP SHOULD HAVE BEEN ESTIMATED ON THE VALUE OF ` 150.81 LAKHS ONLY. IN FIND MERIT IN THE SAID CONTENTIO N OF THE ASSESSEE AND ACCORDINGLY I RESTORE THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO EXAMINE THE CLAIM OF THE ASSESSEE AND ESTIMATE THE PROFIT AT THE RATE STATED IN THE EARLIER PARAGRAPH ON THE NET VALUE OF PURCHASES. 9. PARAG RAPH NO. 8 IN THE APPEAL ORDER SHALL BE RENUMBERED AS PARA NO.9 . MS. RASHMI ANURAG TIBREWALA 4 10. IN THE RESULT, MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 20 .4 . 201 8 . SD/ - (B.R.BASKARAN ) ACCOUNTANT MEMBER MUMBAI ; DATED : 20 / 4 / 20 1 8 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUM BAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( SENIOR P RIVATE S ECRETARY ) PS ITAT, MUMBAI