SAMPAT KHIMRAJ JAIN,MUMBAI V. JT. COMMISSIONER OF INCOME TAX RANGE 142 , MUMBAI

ITA 5133/MUM/2024

AI Insights

The case involves Sampat Khimraj Jain, a manufacturer and trader of gold ornaments and bars, who appealed against the order of the CIT(A) confirming an addition of Rs.4,52,034/- to his income for the Assessment Year 2011-12. The addition was initially made by the AO during scrutiny assessment, questioning the labor charges paid to three parties due to their non-response to a notice under section 133(6) of the Income Tax Act. The CIT(A) upheld the addition, but the Tribunal, after reviewing the comprehensive documentary evidence provided by the assessee, overturned the CIT(A)'s decision and directed the deletion of the addition.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 35484 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2011-2012
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BHANGEPATIL PUSHKARAJ RAMESH; DR
• Assessee Lawyers: SATYAPRAKASH SINGH; AR
• Keywords: TDS
• Section: 133(6)

Judgement Text

"| आयकर अपीलीय अिधकरण \fा यपीठ, मुंबई | IN THE INCOME TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI BEFORE SAKTIJIT DEY, HON’BLE VICE PRESIDENT & SHRI NARENDRA KUMAR BILLAIYA, HON’BLE ACCOUNTANT MEMBER I.T.A. No. 5133/Mum/2024 Assessment Years: 2011-12 Sampat Khimraj Jain, Mumbai Room No. 12, 2nd Floor 8/10, Tel Gally Vithalwadi Mumbai - 400002 [PAN: AABPJ2602C] Vs Jt. Commissioner of Income Tax, Range - 14(2), Mumbai अपीला थ\u0016/ (Appellant) \u0017\u0018 यथ\u0016/ (Respondent) Assessee by : Shri Satyaprakash Singh, A/R Revenue by : Shri Bhangepatil Pushkaraj Ramesh, Sr. D/R सुनवाई की तारीख/Date of Hearing : 21/01/2025 घोषणा की तारीख /Date of Pronouncement: 23/01/2025 आदेश/O R D E R PER NARENDRA KUMAR BILLAIYA, AM: This appeal by the assessee is preferred against the order dated 27/09/2024 by NFAC, Delhi [hereinafter ‘the ld. CIT(A)’] pertaining to AY 2011-12. 2. The sum and substance of the grievance of the assessee is that the ld. CIT(A) erred in confirming the addition of Rs.4,52,034/- on account of labor charges paid to:- i) M/s. Avani Jewellers Rs.3,27,897/- ii) Shri Jayesh Jagga Rs.1,84,347/- iii) Shri Rajesh M. Dhanak Rs.92,069/- Total Rs.4,52,034/- 3. Representatives of both the sides were heard at length. Case records carefully perused and relevant documentary evidence duly considered in the light of Rule 18(6) of the ITAT Rules, 1963. I.T.A. No. 5133/Mum/2024 2 4. Briefly stated the facts of the case are that the assessee in engaged in manufacturing and trading of gold ornaments and gold bars. It electronically filed its return of income on 30/09/2011 declaring total income of Rs. 25,91,034/-. The return was selected for scrutiny assessment and accordingly statutory notices were issued an served upon the assessee. 5. During the course of scrutiny assessment proceedings, the AO issued notices u/s 133(6) of the Act to the following persons:- 6. The assessee was also required to produce the above parties for verification. On receiving no plausible reply, the AO made the addition of Rs.29,54,431/- debited under labour charges. The AO further made addition of Rs.35,73,170/- being difference in the sales figure shown in respect of M/s. Alukkas Gold Retail India (P) Ltd. and Rs.4,17,695/- being the difference in the labour charges received by the assessee and shown in the P&L account. 7. The assessee strongly agitated the matter before the ld. CIT(A) and furnished relevant documentary evidence. After considering the facts and the submissions and the evidence furnished by the assessee I.T.A. No. 5133/Mum/2024 3 and also calling for the remand report from the AO, the ld. CIT(A) deleted Rs.11,28,125/- and further found that labour charges paid to the tune of Rs.8,38,486/- was also explained and deleted the same. However, the ld. CIT(A) confirmed the addition of Rs.4,52,034/- being labour charges paid to three parties, namely, M/s. Avani Jewellers, shri Jayesh Jagga and Shri Rajesh M. Dhanak. 8. We find that in the case of these three parties, the assessee has furnished ledger confirmations, ITR, Pan, Aadhar card, bank statements indicating payments made and labour charges vouchers. Merely because these parties did not respond to the notice u/s 133(6) of the Act, would not be the sole reason to make the impugned addition when there are documentary evidences mentioned hereinabove which go on to prove the identity and genuineness of the payments as all the payments were subject to TDS. Considering the evidences brought on record, we do not find any reason in making the impugned addition. The AO is directed to delete the same. 9. In the result, appeal of the assessee is allowed. Order pronounced in the Court on 23rd January, 2025 at Mumbai. Sd/- Sd/- (SAKTIJIT DEY) (NARENDRA KUMAR BILLAIYA) VICE-PRESIDENT ACCOUNTANT MEMBER Mumbai, Dated 23/01/2025 *SC SrPs *SC SrPs *SC SrPs *SC SrPs I.T.A. No. 5133/Mum/2024 4 आदेश की \u0015ितिलिप अ\u001aेिषत /Copy of the Order forwarded to : 1. अपीलाथ\u001c / The Appellant 2. \u0015\u001dथ\u001c / The Respondent 3. संबंिधत आयकर आयु\" / Concerned Pr. CIT 4. आयकर आयु\" ) अपील ( / The CIT(A)- 5. िवभागीय \u0015ितिनिध ,आयकर अपीलीय अिधकरण, मुंबई /DR,ITAT, Mumbai, 6. गाड& फाई/ Guard file. आदेशानुसार/ BY ORDER, TRUE COPY Assistant Registrar आयकर अपीलीय अिधकरण ITAT, Mumbai "