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Income Tax Appellate Tribunal, “H” BENCH, MUMBAI
Before: HON’BLE SHRI MAHAVIR SINGH, VP & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
आयकर अपीलीय अधिकरण “एच” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “H” BENCH, MUMBAI माननीय श्री महावीर स िंह, उपाध्यक्ष एवुं माननीय श्री मनोज कुमार अग्रवाल ,लेखा दस्य के मक्ष। BEFORE HON’BLE SHRI MAHAVIR SINGH, VP AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM (Hearing Through Video Conferencing Mode) आयकरअपील िं./ (धििाारण वर्ा / Assessment Year: 2011-12) DCIT-15(3)(2) M/s Sonak Engineering Pvt. Ltd. R.No.451, 4th Floor बिाम/ R-371, TTC Industrial Area Aaykar Bhawan, M.K.Road Thane Belapur Rabale Vs. Mumbai – 400 020 Navi Mumbai – 400 701 स्थायीलेखा िं./ जीआइआर िं./ PAN/GIR No. AAGCS-0120-A (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : Assessee by : None Revenue by : Shri Gurbinder Singh-Ld. DR ुनवाई की तारीख/ : 22/04/2021 Date of Hearing घोषणा की तारीख / : 03/05/2021 Date of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member)
Aforesaid appeal by revenue for Assessment year [AY in short] 2011-12 contest the order of Ld. Commissioner of Income Tax (Appeals)-24, Mumbai [in short CIT(A) ] which has provided certain relief to the assessee on account of alleged bogus purchases.
Though none appeared for assessee, however, material on record was sufficient for disposal of the appeal. The Ld. DR pleaded for restoration of assessment framed by Ld. AO.
3.1 The material facts are that the assessee being resident corporate assessee stated to be engaged in manufacturing of engineering goods was assessed for the year under consideration u/s 143(3) r.w.s. 147 on 30/01/2016. The original return filed by the assessee was processed u/s 143(1). However, pursuant to receipt of certain information from DGIT (Inv.) / Sales Tax Department, Mumbai, it transpired that the assessee made alleged bogus purchases of Rs.15.85 Lacs from three entities as detailed in the assessment order. Accordingly, the case was reopened as per due process of law and the assessee was required to file requisite details to substantiate the purchases. 3.2 In support of purchases, the assessee furnished ledger accounts, invoices, details of goods manufactured and sold along with excise record. It was submitted that the goods were sold to reputed companies. However, Ld. AO opined that the assessee failed to establish delivery of goods and also failed to file the confirmation of the suppliers. In the alternative, the assessee offered 10% estimated additions against these purchases. However, not convinced, the aforesaid purchases were treated as bogus purchases and added to the income of the assessee.
Upon further appeal, Ld. CIT(A), after considering factual matrix and relying upon the decision of Hon’ble Gujarat High Court in the case of CIT V/s Simit P.Sheth (356 ITR 451), estimated additions of 12.5% against these purchases. Aggrieved, the revenue is in further appeal before us.
Going by the factual matrix as enumerated in the orders of lower authorities, we find that the issue has rightly been clinched in proper perspective by Ld. CIT(A). The Sales Turnover was not in doubt and the assessee was in possession of primary purchase documents. The payment to the supplier was through banking channels. There could be no sale without actual purchase of material keeping in view the assessee’s nature of business. The facts of the case made it a fit case to estimate the profit element embedded in these transactions. Therefore, concurring with findings of Ld. CIT(A) in the impugned order, we dismiss the appeal.
The appeal stands dismissed.