ITO 28(3)(1), MUMBAI vs. SANJAY A CHOUBEY, MUMBAI

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ITA 4789/MUM/2019Status: DisposedITAT Mumbai05 April 2021AY 2010-113 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 found that the assessee had primary purchase documents and made payments through banking channels. Therefore, it was appropriate to estimate the profit element in these transactions.

What were the facts?

The assessee was assessed for alleged bogus purchases of Rs. 11.46 Lacs based on information from the Sales Tax Department. The Assessing Officer disallowed these purchases and added them back to the assessee's income.

What were the issues?

Whether the disallowance of purchases was justified and to what extent profit should be estimated on alleged bogus purchases.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 148,Section 133(6)

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI

Before: HON’BLE SHRI SAKTIJIT DEY, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

For Respondent: Ms. Smita Verma – Ld. Sr. DR

आयकर अपीलीय अधिकरण “एक-सदस्य मामला” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI माननीय श्री शक्तिजीत दे, न्याययक सदस्य एवुं माननीय श्री मनोज कुमार अग्रवाल ,लेखा सदस्य के समक्ष। BEFORE HON’BLE SHRI SAKTIJIT DEY, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM (Hearing Through Video Conferencing Mode) आयकरअपील सं./ (धििाारण वर्ा / Assessment Year: 2010-11) ITO-28(3)(1), Mumbai Shri Sanjay Choubey Room No.316, 3rd Floor,6th Tower, Gharondha Co-op Hsg. Society बिाम/ Vashi Railway Stn.Complex F-27, Room No.04 Vs. Vashi, Navi Mumbai – 400 703. Sector -9, Ghansoli Navi Mumbai-400 701. स्थायीलेखासं./जीआइआरसं./PAN/GIR No. AFKPC-2939-K (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : Assessee by : None Revenue by : Ms. Smita Verma – Ld. Sr. DR सुनवाई की तारीख/ : 23/03/2021 Date of Hearing घोषणा की तारीख / : 05/04/2021 Date of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member)

1.

Aforesaid appeal by revenue for Assessment Year (AY) 2010-11 contests the order of learned first appellate authority dated 15/05/2019 which has provided certain relief to the assessee on account of alleged bogus purchases.

2.

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 that the assessee being resident individual stated to be engaged in manufacturing of pharma machineries was assessed u/s 143(3) r.w.s. 147 on 18/03/2016. The assessment was so framed pursuant to receipt of certain information from Sales Tax Department that the assessee procured accommodation purchase bills of Rs.11.46 Lacs from 2 parties as detailed in the assessment order. Accordingly, notice u/s 148 was issued on 22/01/2015 which was followed by statutory notices u/s 143(2) & 142(1) calling for requisite details from assessee to substantiate the purchases so made. 3.2 Though the assessee filed certain documentary evidences in support of purchases, however, notices issued u/s 133(6) did not elicit any satisfactory response. Consequently, these purchases were disallowed and added back to assessee’s income.

4.

Upon further appeal, Ld. CIT(A), inter-alia, relying upon the decision of Hon’ble Gujarat High Court in Simit P.Sheth 356 ITR 451 restricted the additions to the extent of 12.5% of these purchases. Aggrieved, the revenue is in further appeal before us.

5.

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 suppliers was through banking channels. The facts of the case made it a fit case to estimate the profit element embedded in these transactions. Concurring with findings of Ld. CIT(A) in the impugned order, we dismiss the appeal.

6.

The appeal stands dismissed. Order pronounced on 5th April, 2021.

Sd/- Sd/- (Saktijit Dey) (Manoj Kumar Aggarwal) न्याययक सदस्य / Judicial Member लेखा सदस्य / Accountant Member मुंबई Mumbai; यदनांक Dated : 05/04/2021 Sr.PS, Jaisy Varghese आदेशकीप्रधिधलधपअग्रेधर्ि/Copy of the Order forwarded to : 1. अपीलाथी/ The Appellant 2. प्रत्यथी/ The Respondent 3. आयकरआयुि(अपील) / The CIT(A) 4. आयकरआयुि/ CIT– concerned 5. यवभागीयप्रयतयनयध, आयकरअपीलीयअयधकरण, मुंबई/ DR, ITAT, Mumbai 6. गार्डफाईल / Guard File आदेशाि सार/ BY ORDER,

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