YOGESH ASHOK LALWANI,,PUNE vs. INCOME-TAX OFFICER, WARD - (HQ)-6(1),, PUNE

PER R.S.SYAL, VP : These two appeals by the assessee relate to the assessment years 2009-10 and 2010-11. Since common issue is raised in these two appeals, I am, therefore, proceeding to dispose them off by this consolidated order for the sake of convenience. A.Y. 2009-10 : 2. Briefly stated, the facts of the case are that Maharashtra Sales Tax Department informed names of certain

2 ITA Nos.2239 & 2240/PUN/2017 Yogesh A. Lalwani

suppliers/parties as non-genuine/hawala dealers who had

provided entries for bogus purchases by issuing false bills. The

assessee was found to be one of the beneficiaries, who had

claimed purchases worth Rs.31,96,554/- from two non-

genuine hawala parties, namely, Siddhivinayak Enterprises

and Meenakshi Enterprises. The Assessing Officer (AO)

initiated re-assessment proceedings. In the course of such

proceedings, the AO observed that the assessee had offered

GP at 17.84% on total material purchases. In view of the

bogus purchases, the assessee offered disallowance of 20% of

purchases at Rs.6,39,310/-, which was added by the AO. The

ld. CIT(A) dismissed the appeal, against which the assessee

has come up in appeal before the Tribunal.

relevant material on record. It is seen that cases of several

assessees who had obtained bogus purchases from such

persons have come up for consideration before the Pune

Benches of the Tribunal. Vide the lead order in the case of

M/s. Chhabi Electricals Pvt. Ltd. and others Vs. DCIT dated

28-04-2017 in ITA No.795/PUN/2014 and others, the Tribunal

has made certain categories. Category No. IV of the said

ITA Nos.2239 & 2240/PUN/2017 Yogesh A. Lalwani

order, which is germane to the instant appeal, provides as

under :

“IV. The next instance is the case of goods which have been admittedly sold by the hawala dealer and has been received by the assessee, who in turn had maintained quantitative details and also evidence of its movement i.e. transportation details and quality control details of consumption of the said material or exact details of sale of the same consignment through same transporter directly to the party, then the total purchases cannot be added in the hands of assessee. However, since the purchases are made from the grey market, some estimation needs to be made in the hands of assessee. The Tribunal in M/s. Chetan Enterprises Vs. ACIT (supra) has already held that the addition be made by estimating the same @ 10% of the alleged hawala purchases, over and above the GP shown by the respective assessee.”

Electricals Pvt. Ltd. and others (supra), which has been

followed in innumerable number of cases, I hold that the

addition should have been sustained @10% of alleged hawala

purchases over and over the normal GP rate shown by the

assessee at 17.84%. Since the AO has added only 20% in

respect of such bogus purchases, which is less than the rate

given in M/s. Chhabi Electricals Pvt. Ltd., being, 10% over

and above the normal GP rate which in the instant case is

17.84%, I hold that no further interference is warranted in the

impugned order.

4 ITA Nos.2239 & 2240/PUN/2017 Yogesh A. Lalwani

A.Y. 2010-11 :

The facts for this assessment year are mutatis mutandis 5.

similar to those of the preceding year. In this year, the total

bogus purchases made by the assessee were to the tune of

Rs.53,31,307/-. The assessee offered GP rate at 20%. The

AO, on the basis of disallowance offered by the assessee at

20%, made an addition of Rs.10,66,261/-, which remained

unaltered before the ld. CIT(A).

appeal at 20% of the bogus purchases is less than 25% (10%

over the above the normal GP rate of 15%), I hold that no

further relief is warranted.

Order pronounced in the Open Court on 20th February, 2019. S

Sd/- (R.S.SYAL) उपा�य�/ VICE PRESIDENT उपा�य� उपा�य� उपा�य�

पुणे Pune; �दनांक Dated : 20th February, 2019 सतीश

ITA Nos.2239 & 2240/PUN/2017 Yogesh A. Lalwani

आदेश क� क� �ितिलिप �ितिलिप अ�ेिषत अ�ेिषत / Copy of the Order is forwarded to : क� क� �ितिलिप �ितिलिप अ�ेिषत अ�ेिषत आदेश आदेश आदेश

अपीलाथ� / The Appellant; 1. ��यथ� / The Respondent; 2. आयकर आयु�(अपील) / 3. The CIT (Appeals)-7, Pune 4. The Pr. CIT-6, Pune िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, पुणे “SMC” / 5. DR ‘SMC’, ITAT, Pune; गाड� फाईल / Guard file. 6. // True copy // आदेशानुसार आदेशानुसार आदेशानुसार/ BY ORDER, आदेशानुसार

// True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune

Date 1. Draft dictated on 19-02-2019 Sr.PS 2. Draft placed before author 19-02-2019 Sr.PS 3. Draft proposed & placed before the JM second member 4. Draft discussed/approved by Second JM Member. 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *