ITO- 17(2)(1), MUMBAI, MUMBAI vs. M/S. IRON AND STEEL TRADERS, MUMBAI

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ITA 6373/MUM/2019Status: DisposedITAT Mumbai04 October 2021AY 2011-123 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s order, agreeing that the addition was made on mere probabilities without concrete evidence. The assessee's failure to discharge its onus was not sufficiently established by the AO.

What were the facts?

The Assessing Officer made an addition for bogus purchases amounting to Rs. 2,45,113/-, alleging the assessee obtained accommodation entries. The CIT(A) deleted this addition, finding no cogent evidence of the assessee's involvement.

What were the issues?

Whether the addition for bogus purchases was justified without sufficient evidence of the assessee obtaining accommodation entries.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI

Hearing: 26/07/2021Pronounced: 04/10/2021

ORDER PER VIKAS AWASTHY, J.M: This appeal by the Revenue is directed against the order of Commissioner of Income Tax (Appeals)-28, Mumbai [hereinafter referred to as ‘the CIT(A)’] ' dated 15.07.2019 for the Assessment Year (AY) 2011-12. 2. Sh. Sajjay J. Sethi representing the Department submitted that the assessee has obtained accommodation entries aggregating to Rs. 2,45,113/- आअसं. 6373/मुं/2019 (िन.व.2011-12) (A.Y. 2011-12) from Mahendra Shantilal Patel, a bogus entry provider on commission basis. Thus, the Assessing Officer (AO) made addition of the entire bogus purchases. The ld. CIT(A) has deleted the entire addition. The ld. Departmental Representative (DR) submitted that the CIT(A) has failed to appreciate the fact that the assessee was not able to discharge its onus in proving genuineness of the purchases, no confirmations were filed by the assessee nor the assessee was able to produce the suppliers. The CIT(A) has deleted the entire addition merely on surmises and conjectures.

3.

On the other hand, Sh. Dalpat Shah representing the assessee vehemently defended the impugned order and prayed for dismissing the appeal by the Revenue.

4.

Both sides heard, orders of the authorities below examined. A perusal of the impugned order shows that the CIT(A) has deleted the addition by observing that the AO has made addition merely on preponderance of probabilities without their being any cogent evidence or circumstances indicating assessee’s involvement in obtaining accommodation entries. I concur with the findings of CIT(A) and hence upheld the same.

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