RSA Number | 486219914 RSA 2018 |
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Assessee PAN | AAHFA7543D |
Bench | Mumbai |
Appeal Number | ITA 4862/MUM/2018 |
Duration Of Justice | 1 year(s) 3 month(s) 1 day(s) |
Appellant | AMAR DIAMOND TOOLS, MUMBAI |
Respondent | ITO WD 1(1), THANE |
Appeal Type | Income Tax Appeal |
Pronouncement Date | 18-11-2019 |
Appeal Filed By | Assessee |
Order Result | Allowed |
Bench Allotted | SMC |
Tribunal Order Date | 18-11-2019 |
Last Hearing Date | 20-08-2019 |
First Hearing Date | 20-08-2019 |
Assessment Year | 2008-2009 |
Appeal Filed On | 16-08-2018 |
Judgment Text |
T HE INCOME TAX APPELLATE TRIBUNAL SMC BENCH MUMBAI BEFORE SHRI SHAMIM YAHYA ( A M) I.T.A. NO. 4862 /MUM/ 201 8 (ASSESSMENT YEAR 20 0 8 - 0 9 ) I.T.A. NO. 486 3 /MUM/2018 (ASSESSMENT YEAR 200 9 - 1 0) AMAR DIAMOND TOOLS 1 ST FLOOR SHIV DARSHAN BUILDING MUMBAI PUNE ROAD MUMBRA THANE (WEST) MAHARASHTRA - 400 612. PAN : AAHFA7543D V S . ITO WARD 1(1) ROOM NO. 23 B WING 6 TH FLOOR ASHAR IT PARK ROAD NO. 16Z WAGLE INDUSTRIAL ESTATE THANE (WEST) MAHARASHTRA - 400 604. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY M S. PRITAMA POKHRANA DEPARTMENT BY SHRI CHAITANYA ANJARIA DATE OF HEARING 22.8 . 201 9 DATE OF PRONOUNCEMENT 18 . 1 1 . 201 9 O R D E R THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST COMMON ORDER OF LEARNED CIT(A) DATED 8.6.2018 PERTAIN TO A.Y. 2008 - 09 & 2009 - 10. 2. IN BOTH THE APPEALS THE ASSESSEE IS AGGRIEVED THAT LEARNED CIT(A) ERRED IN SUSTAINING 12.5% DISALLOWANCE OUT OF BOGUS PURCHASES. 3. BRIEF FACTS ARE THAT THE ASSESSEE IS ENGAGED IN MANUFACTURING AND TRADING IN INDUSTRIAL TOOLS. TH E ASSESSMENT WAS REOPENED PURSUANT TO SEARCH ACTION IN THE JAIN GROUP WHEREIN IT WAS FOUND THAT BOGUS ACCOMMODATION ENTRIES WERE BEING PROVIDED. THE ASSESSING OFFICER BASED HIS REASSESSMENT ON THE STATEMENT OF SHRI RAJENDRA JAIN IN THE CASE OF JAIN GROUP CASE. ACCORDINGLY IMPUGNED PURCHASES WERE HELD TO BE BOGUS AND DISALLOWANCE @ 12.5% WAS DONE. AMOUNT DISALLOWED WAS RS. 5 24 496 / - FOR A.Y. 2008 - 09 AND RS. 90 726/ - FOR A.Y. 2009 - 10 . AMAR DIAMOND TOOLS 2 4. UPON ASSESSEES APPEAL LEARNED CIT(A) CONFIRMED THE ADDITION. AGAIN ST THIS ORDER THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 5. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORD. LEARNED COUNSEL OF THE ASSESSEE CONTENDED THAT THE ASSESSEE HAS SUPPLIED ALL NECESSARY DETAILS I.E. PURCHASE BILLS SALE BILLS AND BANK STATE MENTS. HE SUBMITTED THE AFFIDAVITS FROM SUPPLIERS WERE ALSO SUBMITTED. IT IS ALSO CLAIMED DURING INQUIRY U/S. 136 (6) THAT PROPRIETARY CONCERNS OF ABOVE SUPPLIERS ALSO CONFIRMED THESE PURCHASES AND SUBMITTED LEDGER ACCOUNT. LEARNED COUNSEL FURTHER SUBMITTED THAT THE SALES HAVE NOT AT ALL BEING DOUBTED. LEARNED COUNSEL CLAIMED THAT NO DISALLOWANCE IS CALL ED FOR AS ASSESSEE HAS OFFERED ADEQUATE GROSS PROFIT ON THESE TRANSACTIONS. 6. UPON CAREFUL CONSIDERATION I NOTE THAT LEARNED COUNSEL CLAIMED THAT THE A SSESSEE HAS ALSO ALREADY SHOWN SUFFICIENT GROSS PROFIT HENCE NO DISALLOWANCE IS REQUIRED. U PON CAREF U L CONSIDERATION I FIND THAT ASSESSEE HAS PROVIDED THE DOCUMENTARY EVIDENCE FOR THE PURCHASE. EVEN THE IMPUGNED SUPPLIERS HAVE RESPONDED TO 133(6) NOTICES A ND CONFIRMED THE PURCHASES. ADVERSE INFERENCE HA S BEEN DRAWN DUE TO THE INABILITY OF THE ASSESSEE TO PRODUCE THE SUPPLIERS. I FIND THAT IN THIS CASE THE SALES HAVE NOT BEEN DOUBTED. IT IS SETTLED LAW THAT WHEN SALES ARE NOT DOUBTED HUNDRED PERCENT DISALLO WANCE FOR BOGUS PURCHASE CANNOT BE DONE. THE RATIONALE BEING NO SALES IS POSSIBLE WITHOUT ACTUAL PURCHASES. THIS PROPOSITION IS SUPPORTED FROM HONOURABLE JURISDICTIONAL HIGH COURT DECISION IN THE CASE OF NIKUNJ EXIMP E NTERPRISES (IN WRIT PETITION NO 2860 ORDER DT . 18.6.2014). IN THIS CASE THE HONOURABLE HIGH COURT HAS UPHELD HUNDRED PERCENT ALLOWANCE FOR THE PURCHASES SAID TO BE BOGUS WHEN SALES ARE NOT DOUBTED. HOWEVER IN THAT CASE ALL THE SUPPLIES WERE TO GOVERNMENT AGENCY . IN THE PRESENT CASE I FIND TH AT ALL THE DETAILS FOR PURCHASES HAVE BEEN SUPPLIED. THE IMPUGNED SUPPLIER S ALSO RESPONDED TO THE NOTICE U/S. 133(6). HENCE ADDITION IS SOLELY MADE ON THE BASIS OF FINDINGS OF SEARCH IN THE CASE OF RAJENDRA JAIN GROUP DEHORSE ANY INDEPENDENT FINDING BY TH E ASSESSING OFFICER. MOREOVER ASSESSEES CLAIM IS THAT THE ASSESSEE ALSO SHOWN SUFFICIENT AMAR DIAMOND TOOLS 3 GROSS PROFIT AND WHEN SALES HAVE NOT DOUBTED NO DISALLOWANCE IS CALLED FOR. I FIND SUFFICIENT COGENCY IN THIS SUBMISSION. HENCE ADDITION IN THIS CASE IS DIRECTED T O BE DELETED. 7. IN THE RESULT BOTH THE APPEAL S ARE ALLOWED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 18 . 1 1 . 201 9 . SD/ - (SH A MIM YAHYA ) ACCOUNTANT MEMBER MUMBAI ; DATED : 18 / 1 1 / 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// ( ASSISTANT REGISTRAR ) PS ITAT MUMBAI
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