ITO 24(3)(5), MUMBAI vs. RANJANBEN DODIA, MUMBAI

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ITA 1446/MUM/2019Status: DisposedITAT Mumbai12 March 2021AY 2009-103 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 affirmed the order of the CIT(A) by following the order in the assessee's own case for a different assessment year. The Tribunal found that the AO had not adequately verified the purchase invoices and payment evidences.

What were the facts?

The assessee obtained bogus purchase bills amounting to Rs. 19,16,902/-. The Assessing Officer (AO) made an addition of this entire amount as bogus purchases. The CIT(A) restricted the disallowance to 5% of the bogus purchases.

What were the issues?

Whether the entire amount of bogus purchases should be disallowed or a reduced percentage. Whether the AO had conducted proper verification of purchases.

Which sections of the Income-tax Act were involved?

Section 69C,Section 143(3),Section 147,Section 148,Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “SMC” MUMBAI

Before: SHRI VIKAS AWASTHY & SHRI N.K. PRADHAN

Hearing: 08/03/2021Pronounced: 12/03/2021

ORDER PER N.K. PRADHAN, A.M. The captioned appeal filed by the Revenue is directed against the order of the Commissioner of Income Tax (Appeals)-36, Mumbai [in short ‘CIT(A)’] and arises out of the assessment completed u/s 143(3) r.w.s. 147 of the Income Tax Act 1961, (the ‘Act’).

Though the case was fixed for hearing on 12.03.2020, 14.01.2021 & 08.03.2021, neither the assessee nor his Authorized Representative (AR) appeared before the Tribunal on above dates. As there is non-compliance by Smt. Ranjanben Dodia the assessee, we are proceeding to dispose-off this appeal after examining the materials available on record and after hearing the Ld. Departmental Representative (DR).

2.

Briefly stated the facts of the case are that the assessee filed her return income for the AY 2009-10 on 12.09.2009 declaring total income of Rs.2,69,380/-. On the receipt of information from the Sales Tax Department, Government of Maharashtra that the assessee had obtained bogus purchase bills amounting to Rs.19,16,902/- from seven parties, the Assessing Officer (AO) issued notice u/s 148 of the Act for reopening the assessment. During the course of re-assessment proceedings, the AO issued notice u/s 133(6) to the said parties to verify the genuineness of the purchases. However, those notices were returned un-served by the Postal authorities with the remarks “not known”. The AO further recorded that the assessee failed to produce the said parties before him for examination. Considering the above facts, the AO made an addition of the total amount of Rs.19,16,902/- as bogus purchases u/s 69C of the Act.

3.

In appeal, the Ld.CIT(A) by following the order of the Tribunal in assessee’s own case for AY 2011-12 restricted the disallowances to 5% of the bogus purchases of Rs.19,16,902/- which comes to Rs.95,845/-.

4.

Before us, the Ld. DR submits that the order passed by the Ld. CIT(A) be set aside and the order passed by the AO be restored.

We have heard the ld.DR and perused the relevant materials available on record. The nature of the business of the assessee in the present case is Smt. Ranjanben Dodia manufacturing of lift parts. Here, as recorded by the AO, the assessee filed before him invoices of purchases and some evidences of payment. The AO could have verified the contents in the purchase invoices and the genuineness of payments. He has not done so. In the instant case, the Ld.CIT(A) has rightly followed the order of the Tribunal in assessee’s own case for AY 2011-12. Facts being identical, we affirm the order of the Ld.CIT(A).

5.

In the result, the appeal filed by the Revenue is dismissed.

Order pronounced in the open Court on 12/03/2021

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