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Income Tax Appellate Tribunal, “A” BENCH, MUMBAI
Before: HON’BLE SHRI MAHAVIR SINGH, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
आयकरअपील सं./ (िनधा"रण वष" / Assessment Year:2009-10) Income Tax Officer-21(1)(1) Shri Anil P. Sawardekar Room No.103, 1st Floor Room No.234, Kamgar Nagar बनाम/ No.2, Near Bombay Dyeing Mill, Piramal Chambers, Parel Vs. New Prabhadevi Road Mumbai-400 012. Mumbai-400 088. "थायीलेखासं./जीआइआरसं./PAN/GIR No. BINPS-1468-Q (अपीलाथ"/Appellant) (""थ" / Respondent) : Revenue by : Shri Satish Chandra Rajore- Ld. DR Assessee by : Shri Amit Jhaveri - Ld.AR सुनवाई की तारीख/ : 31/07/2019 Date of Hearing घोषणा की तारीख / : 01/08/2019 Date of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member):- 1. Aforesaid appeal by revenue for Assessment Year [in short referred to as ‘AY’] 2009-10 contest the order of Ld. Commissioner of Income- Tax (Appeals)-33, Mumbai, [in short referred to as ‘CIT(A)’], Appeal No. CIT(A)-33/Rg.21/164/2015-16 dated 15/01/2018 on following grounds of appeal: - 2 Anil P. Sawardekar Assessment Year :2009-10 1. On the facts and circumstances of the case, the Ld. CIT(A) has erred in restricting the disallowances on bogus purchases of Rs. 1,38,06,689/- to 25% of such purchases i.e. Rs. 34,51,671/- by relying upon the decision of the Hon'ble ITAT Ahmedabad, in case of Vijay Proteins Pvt. Ltd. Vs. CIT (58 ITD 428), without appreciating that the facts of the instant case are distinguishable in that no details whatsoever regarding the alleged bogus purchase transactions were submitted during assessment proceedings.
2. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in ignoring the fact the primary onus is on the assessee to prove the genuineness of the purchases claimed by the assessee and the assessee has not discharged the same.
3. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in admitting the additional evidence which is in contravention of Rule 46A of the Income tax Rules, 1962.
4. The appellant prays that the order of the Ld.CIT(A) on the above grounds be set aside and that of the Assessing Officer be restored. 2.1 Facts in brief are that the assessee being resident individual engaged in trading activities was assessed for year under consideration u/s 144 r.w.s. 147 of the Income Tax Act, 1961 wherein the assessee was saddled with certain additions on account of alleged bogus purchases for Rs.138.06 Lacs. 2.2 The reassessment proceedings were triggered as per due process of law, pursuant to receipt of certain information from DGIT (Investigation), Mumbai that the assessee obtained hawala purchase bills aggregating to Rs.138.06 Lacs from 5 entities, the details of which have already been extracted in para-3 of the assessment order. The assessee could not defend the purchases made by it from the stated entities and notices issued u/s 133(6) to all the entities were returned back unserved in all the cases. The factual matrix led the Ld. AO to disbelieve the stated purchase transactions and accordingly, the same were added back to the income of the assessee while framing the assessment.
3 Anil P. Sawardekar Assessment Year :2009-10 2.3 Before Ld. first appellate authority, the assessee contested the quantum additions on merits by way of elaborate written submissions, which have already been reproduced in the impugned order and hence not repeated here for the sake of brevity. The assessee, inter-alia, submitted that there was direct nexus between sales and purchase and the books of account were duly audited as per law. The payment to all the suppliers was through banking channels and there could be no sale without actual purchase of material. The Ld. first appellate authority, after due consideration of factual matrix and relying upon the decision of Hon’ble Gujarat High Court rendered in CIT Vs. Simit P. Sheth [356 ITR 451] & CIT Vs. Bholanath Poly Fab. P. Ltd. [355 ITR 290] restricted the impugned additions to 25% of alleged bogus purchases. Aggrieved, the revenue is in further appeal before us. 2.4 The Ld. DR has advanced arguments to submit that the additional evidences filed by the assessee during appellate proceedings were not confronted to Ld. AO. It has further been submitted that Ld. CIT(A) was not justified in providing quantum relief to the assessee. On the other hand, Ld. AR submitted that impugned order would not require any interference on our part.
We have heard the rival submissions and perused relevant material on record and deliberated on judicial pronouncements as cited before us. We are of the considered opinion that there could be no sale without actual purchase of material keeping in view the assessee’s nature of business activities. The assessee was in possession of primary purchase documents and the payments to the suppliers were through banking channels. At the same time, notices issued u/s 133(6) to confirm