ITO-17(1)(5), MUMBAI vs. M/S. HIMANSHU TRADERS, , MUMBAI

Briefly the facts are, the assessee firm is a trader in iron and steel hardware. For both the assessment years under dispute, the assessee had filed its returns of income in regular course and they were processed under section 143(1) of the Act. Subsequently, the assessing officer received information from the Sales-tax department through the Investigation Wing that purchases worth Rs.5,96,896/- in assessment year 2009-10 and Rs.1,59,592/- in assessment year 2012-13 are non genuine as the concerned selling dealers were identified as hawala operators providing accommodation bills. On the basis of such information, assessing officer reopened the assessments for both the assessment years under dispute. In course of assessment proceedings, the assessing officer called upon the assessee to furnish evidence to prove the genuineness of purchases. Though, the assessee furnished some evidences, however, they were not to the satisfaction of the assessing officer. Therefore, ultimately, the assessing officer disallowed the entire purchases alleged to be bogus in both the assessment years and added back to the income of the assessee. Assessee contested the aforesaid additions before learned Commissioner (Appeals). After considering the submissions of the assessee in the context of facts and materials on record, learned Commissioner of (Appeals) restricted the disallowance/addition to 5% of the alleged non genuine purchases in both the years.

We have considered rival submissions and perused materials on record. The learned Departmental Representative submitted, the assessee having failed to prove the genuineness of purchases, the addition made by the assessing officer should be restored. Whereas, the learned Counsel for the assessee submitted, in assessee’s own case for assessment years 2010-11 and 2011-12, the first

Having considered the submissions of the parties, we find from the impugned order of learned Commissioner (Appeals) that similar disallowance in assessee’s own case for assessment years 2010-11 & 2011-12 was made by the assessing officer. However, learned Commissioner (Appeals) restricted the disallowance to 5%. Nothing has been brought before us by the revenue to demonstrate that there is any difference in factual position in the impugned assessment years compared to assessment years 2010-11 & 2011-12. Since, learned Commissioner (Appeals) has followed his earlier decision in restricting the disallowance to 5%, which is stated to have been accepted by the revenue in earlier years, we do not find any valid reason to interfere with the decision of learned Commissioner (Appeals). Grounds are dismissed.

In the result, appeals are dismissed. Order pronounced on 11/03/2021. Sd/- sd/- (N.K. PRADHAN) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dt : 11/03/2021 Pavanan