INCOME TAX OFFICER 17(2)(4), MUMBAI vs. M/S.NAVNIT AUTO AGENCY, MUMBAI

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ITA 1164/MUM/2019Status: DisposedITAT Mumbai28 February 2020AY 2009-102 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 no reason to interfere with the CIT(A)'s order, which restricted the addition to 12.5% of the purchases to serve the purpose of justice and address potential revenue leakage.

What were the facts?

The Assessing Officer (AO) added 100% of purchases amounting to Rs. 38,409/- to the assessee's income, suspecting bogus accommodation bills. The CIT(A) restricted this addition to 12.5%.

What were the issues?

Whether the CIT(A) was justified in restricting the addition for bogus purchases to 12.5% instead of 100%.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI

Before: SHRI R.C. SHARMA & SHRI C.N. PRASAD

For Respondent: Shri Satishchandra Rajore
Hearing: 27/02/2020Pronounced: 28/02/2020

O R D E R PER R.C. SHARMA, ACCOUNTANT MEMBER

This is an appeal filed by the revenue against the order of CIT(A)- 58, Mumbai dated 20/12/2018 for A.Y.2009-10 in the matter of order passed u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961.

2.

In this appeal revenue is aggrieved by the action of CIT(A) for restricting the addition to the extent of 12.5% in respect of bogus purchases.

3.

Rival contentions have been heard and record perused. The AO got information that assessee has taken bogus accommodation bills, accordingly, he added 100% of such purchases in assessee’s income amounting to Rs.38,409/-.

4.

By the impugned order, CIT(A) restricted addition to the extent of 12.5% after recording detailed finding from para 8 to 12 of its appellate order. After applying various judicial pronouncements, CIT(A) held that addition to the extent of 12.5% will serve the purpose of justice so as to fill the gap of leakage of revenue, if any. The finding so recorded by CIT(A) has not been controverted, accordingly, we do not find any reason to interfere in the order of CIT(A).

5.

In the result, appeal of the revenue is dismissed.

Order pronounced in the open court on this 28/02/2020

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