Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “SMC”BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY
Date of Hearing – 10.12.2020 Date of Order – 28/01/2021
O R D E R The aforesaid appeal has been filed by the Revenue challenging a consolidated order dated 3rd April 2019, passed by the learned Commissioner of Income Tax (Appeals)–33, Mumbai, for the assessment years 2009–10, 2010–11 and 2011–12. However, presently I am concerned with appeal for Assessment Year 2009–10.
When the appeal was called for hearing, no one was present on behalf of the respondent assessee to represent the case. There is no application seeking adjournment either. Considering the nature of dispute, I proceed to dispose off the appeal ex–parte qua the assessee
2 Bhakti after hearing the learned Departmental Representative and on the basis of material available on record.
The dispute in the present appeal is confined to partial relief granted by the learned Commissioner (Appeals) in the matter of addition made by the Assessing Officer on account of non–genuine purchases.
Brief facts are, the assessee is a partnership firm engaged in the business of trading in Kurti and Salwar Kamiz. For the assessment year under dispute, the assessee filed its return of income on 24th September 2009, declaring total income of `32,276. The return of income so filed by the assessee was initially processed under section 143(1) of the Act. Subsequently, on the basis of information received from the Sales Tax Department, Government of Maharashtra, through DGIT (Inv.), Mumbai, that purchases worth `22,10,479, claimed to have been made during the year from three parties are non–genuine as the concerned parties were identified as hawala operators, the Assessing Officer re–opened the assessment under section 147 of the Act. During the assessment proceedings, the Assessing Officer called upon the assessee to prove the genuineness of such purchases through supporting evidence. Further, to independently verify the genuineness of such purchases, the Assessing Officer issued notices
3 Bhakti under section 133(6) of the Act to the concerned parties. However, as alleged by the Assessing Officer, no reply was received in response to such notices. Not being satisfied with the evidence furnished by the assessee, the Assessing Officer ultimately concluded that the purchases are non–genuine. However, the Assessing Officer ultimately disallowed 15% out of such purchases, which worked out to `.
3,31,572, and added back to the income of the assessee. The assessee challenged the aforesaid addition before the first appellate authority.
After considering the submissions of the assessee in the context of the facts and material on record, learned Commissioner (Appeals) restricted the addition to 12.5% of the alleged non–genuine purchases.
I have heard the learned Departmental Representative and perused the material on record. It is evident, the doubt regarding the genuineness of the disputed purchases was on the basis of information received from the Sales Tax Department, Government of Maharashtra. However, the Assessing Officer has accepted the fact that the assessee has produced some supporting evidence to prove the genuineness of purchases. The only reason for which he did not accept the purchases to be genuine is, the assessee neither could produce the concerned parties nor could furnish transportation bills, weighment bills, etc.
4 Bhakti However, the very fact that the Assessing Officer did not disallow the entire purchase but has restricted the disallowance to 15% of the alleged non–genuine purchases indicates that the Assessing Officer also believes that the assessee had purchased the goods, though, may not be from the declared source. Therefore, he has proceeded to add the profit element embedded in such purchases. In my view, considering the nature of business carried on by the assessee and keeping in view the decision of the Tribunal in similar nature of cases, learned Commissioner (Appeals) decision to restrict the disallowance to 12.5% of the alleged non genuine purchases is fair and reasonable. Therefore, the order of learned Commissioner (Appeals) is upheld by dismissing the grounds raised by the Revenue.
In the result, appeal is dismissed. Order pronounced on 28/01/2021