ACIT 21(3), MUMBAI vs. SHRI ZAVERCHAND DAMJI HARIA, MUMBAI

Shri Zaverchand Damji Haria Assessment Year: 2011-12 2. We have carefully heard the rival submissions and perused the relevant material on record. The Ld. DR pleaded for confirmation of addition as made by Ld. AO whereas Ld. AR relied upon the estimation made in the impugned order. Our adjudication to the subject matter of appeal would be as given in succeeding paragraphs. 3.1 The material facts are that the assessee being resident individual engaged in manufacturing of garments under proprietorship concern namely M/s Zeal Apparel was assessed for the year under consideration u/s 143(3) r.w.s. 147 vide order dated 15/12/2016. This was second reopening in case of assessee, since the assessment was already framed u/s 143(3) r.w.s. 147 on 31/03/2015. 3.2 The second reopening stem from the fact that pursuant to receipt of certain information from Sales tax Department regarding procurement of bogus bills by assessee from suspicious dealers, it was alleged that the assessee made bogus purchases aggregating to Rs. 45.02 Lacs from two entities, the details of which has already been extracted in para 3.1 of the assessment order. Though, the assessee stated that the purchases were genuine and payment to the suppliers was through banking channels, however, observing that the assessee could not conclusively co-relate the purchases with utilization of the material, Ld. AO estimated addition of 25% against these purchases. 3.3 It could be observed that similar additions were made in the first round of re-opened assessment framed u/s 143(3) r.w.s. 147 on 31/03/2015, wherein the assessee was saddled with similar Shri Zaverchand Damji Haria Assessment Year: 2011-12 disallowances of purchases. However, Ld. CIT(A) restricted the addition to 25%. Upon further appeal, the co-ordinate bench, vide order dated 19/09/2018, relying upon the decision of Hon’ble Gujarat High Court in the case of CIT Vs Simit P.Sheth (356 ITR 451) restricted the addition to the extent of 12.5% of the purchases under consideration.

Following the said decision of Tribunal in ITA No.300/Mum/2017, Ld. CIT(A) directed Ld. AO to estimate the additions @12.5%. Though the assessee has accepted the verdict of Ld. CIT(A), however, the revenue is in further appeal before us by way of present appeal.

Upon perusal of impugned order, it is quite evident that the estimations as made by Ld.CIT(A) is in line with the estimation made by the Tribunal in first round in assessee’s own case. Facts being quite similar, we do not find any reason to deviate from the same. Therefore, we dismiss the revenue’s appeal.

The appeal stand dismissed in terms of our above order. Order pronounced on 11th February, 2021. Sd/- Sd/- (Ravish Sood) (Manoj Kumar Aggarwal) �याियक सद�य / Judicial Member लेखा सद� / Accountant Member मुंबई Mumbai; िदनांक Dated : 11/02/2021 Sr.PS, Kasarla Thirumalesh आदेशकी�ितिलिपअ�ेिषत/Copy of the Order forwarded to : अपीलाथ�/ The Appellant 1. ��थ�/ The Respondent 2. आयकरआयु�(अपील) / The CIT(A) 3. आयकरआयु�/ CIT– concerned 4. िवभागीय�ितिनिध, आयकरअपीलीयअिधकरण, मुंबई/ DR, ITAT, Mumbai 5. गाड�फाईल / Guard File 6.