SHRI LAXMIKANT ASUBHAI GALA, MUMBAI v. ITO, WARD-3(5), MUMBAI

ITA 5203/MUM/2019 | 2009-2010
Pronouncement Date: 08-03-2021 | Result: Partly Allowed

Appeal Details

RSA Number 520319914 RSA 2019
Assessee PAN ABHPG6121A
Bench Mumbai
Appeal Number ITA 5203/MUM/2019
Duration Of Justice 1 year(s) 7 month(s)
Appellant SHRI LAXMIKANT ASUBHAI GALA, MUMBAI
Respondent ITO, WARD-3(5), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 08-03-2021
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted SMC
Tribunal Order Date 08-03-2021
Last Hearing Date 04-03-2021
First Hearing Date 04-03-2021
Assessment Year 2009-2010
Appeal Filed On 08-08-2019
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC MUMBAI ! '# '$ BEFORE VIKAS AWASTHY JUDICIAL MEMBER & SHRI N.K.PRADHAN ACCOUNTANT MEMBER . 5203/ / 2019 (. . 2009-10 ) ITA NO.5203/MUM/2019(A.Y.2009-10) SHRI LAXMIKANT ASUBHAI GALA G-5 NEW SGAR CHS SHIVMANDIR ROAD RAMNAGAR DOMBIWALI EAST- 421 201 PAN: ABHPG 6121A ...... ) / APPELLANT VS. INCOME TAX OFFICER WARD 3(5) 2 ND FLOOR RANI MANSION MURBAD ROAD KALYAN 421 301 ..... !*/ RESPONDENT ASSESSEE BY : MS.RUCHI RATHOD REVENUE BY : SHRI SANJAY J. SETHI +* / DATE OF HEARING : 04/03/2021 -. +* / DATE OF PRONOUNCEMENT : 08/03/2021 '/ ORDER PER VIKAS AWASTHY J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-1 THANE ( IN SHORT THE CIT(A )) DATED 06/06/2019 FOR THE ASSESSMENT YEAR 2009-10. 2. MS.RUCHI RATHOD APPEARING ON BEHALF OF THE ASSE SSEE SUBMITTED THAT THE ASSESSEE IS ENGAGED IN MANUFACTURING OF LABELS AND STICKERS. THE ASSESSMENT YEAR 2009-10 WAS REOPENED ON THE BASIS OF INFORMATION RE CEIVED BY THE DGIT (INV) 2 . 5203/ / 2019 (. . 2009-10 ) ITA NO.5203/MUM/2019(A.Y.2009-10) MUMBAI FROM THE SALE TAX DEPARTMENT GOVERNMENT OF MAHARASHTRA. IN THE REOPENED PROCEEDINGS THE ASSESSING OFFICER HELD TH AT THE ASSESSEE HAS OBTAINED BOGUS PURCHASE BILLS AGGREGATING TO RS.2 75 713/- F ROM SUSPICIOUS DEALERS. THE ASSESSEE WAS NEVER SERVED WITH NOTICE DURING THE AS SESSMENT PROCEEDINGS.. THE ASSESSING OFFICER IN EX-PART PROCEEDINGS MADE ADDIT ION OF THE ENTIRE ALLEGED BOGUS PURCHASES. AGGRIEVED BY THE ASSESSMENT ORDER DATED 06/02/2015 PASSED UNDER SECTION 144 R.W.S. 147 OF THE INCOME TAX ACT 1961 ( IN SHORT THE ACT) THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE ASSESSEE FILED EVIDENCES IN THE FORM OF LEDGER ACCOUNTS OF THE SUPPLIERS BEFORE THE CIT(A) TO PROV E GENUINENESS OF THE PURCHASES. HOWEVER THE SAME WAS REJECTED BY THE CIT(A). HENCE THE PRESENT APPEAL BY THE ASSESSEE. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT THE SALES DECLARED BY THE ASSESSEE HAS BEEN ACCEPTED THEREFO RE THE ENTIRE ALLEGED BOGUS PURCHASES CANNOT BE ADDED. ALTHOUGH THE PURCHASES MADE BY ASSESSEE ARE GENUINE AND ADDITION SHOULD BE DELETED IN ENTIRETY HOWEVER WITHOUT PREJUDICE TO THE PRIMARY CONTENTION THE ADDITION MAY BE RESTRICTED TO THE G.P DECLARED BY THE ASSESSEE OR ANY REASONABLE RATE. 3. PER CONTRA SHRI SANJAY J. SETHI REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE IMPUGNED ORDER AND PRAYED FOR DISMISSI NG THE APPEAL OF THE ASSESSEE. THE LD.DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT T HE ASSESSEE DID NOT CO-OPERATE IN ASSESSMENT PROCEEDINGS. DESPITE REPEATED NOTICE S THE ASSESSEE FAILED TO APPEAR BEFORE THE ASSESSING OFFICER HENCE THE ASSESSING OFFICER WAS CONSTRAINED TO PASS ASSESSMENT ORDER UNDER SECTION 144 OF THE ACT. NO DOCUMENTARY EVIDENCE WAS PRODUCED BY THE ASSESSEE EITHER BEFORE THE ASSESSI NG OFFICER OR BEFORE THE CIT(A) TO SUBSTANTIATE GENUINENESS OF THE PURCHASES/SUPPLIERS . SINCE THE ASSESSEE FAILED TO DISCHARGE HIS ONUS THE AUTHORITIES BELOW HAVE RIGH TLY MADE ADDITION OF THE ENTIRE BOGUS PURCHASES. 3 . 5203/ / 2019 (. . 2009-10 ) ITA NO.5203/MUM/2019(A.Y.2009-10) 4. WE HAVE HEARD THE SUBMISSIONS MADE BY RIVAL SIDE S AND HAVE EXAMINED THE ORDERS OF AUTHORITIES BELOW. A PERUSAL OF THE ASSE SSMENT ORDER SHOWS THAT THE ASSESSEE HAS FAILED TO APPEAR BEFORE THE ASSESSING OFFICER DESPITE SEVERAL NOTICES. SINCE NO EVIDENCE WAS FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER TO PROVE GENUINENESS OF THE PURCHASES AND THE SUPPLIERS THE ASSESSING OFFICER MADE ADDITION OF THE ENTIRE ALLEGED BOGUS PURCHASES. IT IS RELEV ANT TO MENTION HERE THAT THE ASSESSING OFFICER ACCEPTED THE SALES TURNOVER DECLA RED BY THE ASSESSEE. THUS IN SUCH CIRCUMSTANCES THE ENTIRE ALLEGED BOGUS PURCHASES C ANNOT BE ADDED. WITHOUT PURCHASES THERE CANNOT BE SALES. THE ASSESSEE MIGH T HAVE PROCURED GOODS FROM GREY MARKET AND THEREAFTER OBTAINED MATCHING BOGUS PURCHASE BILLS FROM HAWALA OPERATORS. IT IS ONLY THE PROFIT ELEMENT EMBEDDED IN SUCH BOGUS PURCHASES THAT HAS TO BE BROUGHT TO TAX. TAKING INTO CONSIDERATION ENTIRETY OF FACTS WE PROPOSE TO RESTRICT THE ADDITION AT 12.5% OF THE ALLEGED BOGU S PURCHASES. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HAS AGREED FOR THE A DDITION @12.5% ON THE ALLEGED BOGUS PURCHASES. THE ADDITION IS RESTRICTED TO RS. 34 465/- I.E. 12.5% OF THE TOTAL BOGUS PURCHASES. THE IMPUGNED ORDER IS MODIFIED ACCORDINGLY AND THE APPEAL BY THE ASSESSEE IS PARTLY ALLOWED IN THE TERMS AFORES AID. 5. IN THE RESULT APPEAL BY ASSESSEE IS PARTLY ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON MONDAY TH E 08 TH DAY OF MARCH 2021. SD/- SD/- (N.K.PRADHAN) (VIKAS AWAST HY) '# / ACCOUNTANT MEMBER / JUDICIAL MEMBER / MUMBAI 0/ DATED 08 /03/2021 VM SR. PS (O/S) 4 . 5203/ / 2019 (. . 2009-10 ) ITA NO.5203/MUM/2019(A.Y.2009-10) !*12'.* COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT 2. !* / THE RESPONDENT. 3. 3* ( )/ THE CIT(A)- 4. 3* CIT 5. 45!* . . . / DR ITAT MUMBAI 6. 56789 / GUARD FILE. BY ORDER //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT MUMBAI DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPRO VED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER