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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY & SHRI N.K. PRADHAN
PER SAKTIJIT DEY, J.M.
The caption appeal arises out of order dated 12th July 2018, passed by the learned Commissioner of Income Tax (Appeals)–24, Mumbai, pertaining to the assessment year 2010–11.
Brief facts are, the assessee company is a manufacturer of pressure gauges. For the assessment year under consideration, the assessee filed its return of income on 6th July 2010, declaring total
2 M/s. FGB Manufacturing Co. income of ` 2,14,799. On the basis of information received from the Investigation wing of the Department as well as the Sales Tax Department, Government of Maharashtra, indicating that purchases worth ` 11,15,571, claimed to have been made during the year are non–genuine, 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 proper documentary evidences. Further, to independently verify such purchases, the Assessing Officer issued notices under section 133(6) of the Act to the concerned selling dealers. As observed by the Assessing Officer, all such notices returned back un–served by the postal authorities. Thus, holding that the assessee was unable to prove the purchases, the Assessing Officer treated them as non–genuine and added back to the income of the assessee. The assessee challenged the addition before the first appellate authority. After considering the submissions of the assessee in the context of facts and material on record, learned Commissioner (Appeals) restricted the addition to 12.5% of the purchases.
The learned Departmental Representative submitted, since the assessee has failed to prove the purchases through proper documentary evidences, the Assessing Officer was justified in making 100% addition.
3 M/s. FGB Manufacturing Co.
The learned Authorised Representative submitted, while deciding assessee’s appeal on the identical issue for the very same assessment year, the Tribunal has restricted the addition to 12.5% of the non– genuine purchases. Thus, he submitted, Revenue’s appeal in effect has become infructuous.
We have considered rival submissions and perused the material on record. As could be seen from the facts on record, against the decision of learned Commissioner (Appeals) in restricting the addition on account of non–genuine purchases to the gross profit rate of 27.32%, both, the assessee as well as Revenue came in appeal before the Tribunal. However, assessee’s appeal being ITA no.4994/Mum./2018, came up for hearing before the Tribunal earlier and vide order dated 11th September 2019, the Tribunal has disposed off the said appeal by restricting the addition to 12.5% of the non– genuine purchases. Since, the present appeal of the Revenue on identical issue arises out of the very same order of learned Commissioner (Appeals) and the Tribunal while deciding the issue in assessee’s appeal, referred to above, has restricted the addition to 12.5% of the non–genuine purchases, Revenue’s appeal, in our considered opinion, has become redundant. Accordingly, grounds raised are dismissed.
4 M/s. FGB Manufacturing Co. 6. In the result, Revenue’s appeal is dismissed. Order pronounced in the open Court on 19.12.2019 Sd/- Sd/- N.K.PRADHAN SAKTIJIT DEY ACCOUNTANT MEMBER JUDICIAL MEMBER
MUMBAI, DATED: 19.12.2019
Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The CIT(A); (4) The CIT, Mumbai City concerned; (5) The DR, ITAT, Mumbai; (6) Guard file. True Copy By Order Pradeep J. Chowdhury Sr. Private Secretary
Assistant Registrar ITAT, Mumbai