Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, MUMBAI BENCH “A” MUMBAI
Before: SHRI MAHAVIR SINGH & SHRI N.K. PRADHAN
ORDER
PER N.K. PRADHAN, AM
This is an appeal filed by the assessee. The relevant assessment year is 2012-13. The appeal is directed against the order of the Commissioner of Income Tax (Appeals)-44, Mumbai [in short ‘CIT(A)’] and arises out of the assessment completed u/s 143(3) of the Income Tax Act 1961, (the ‘Act’).
Though the case was fixed for hearing on 28.08.2018, 05.12.2018 and 06.05.2019 neither the assessee nor his authorized representative appeared before the Tribunal. No adjournment petition has been filed by the assessee.
Anantrai Kar In view of the repeated non-compliance by the assessee, we dispose off this appeal after examining the materials available on record and after hearing the Ld. DR.
Briefly stated, the facts are that the assessee, trading in building materials filed his return of income for the assessment year (AY) 2011- 12 on 09.07.2012 declaring total income of Rs.17,41,640/-. During the course of assessment proceedings, the Assessing Officer (AO) issued notice u/s 133(6) to 14 suppliers to ascertain the genuineness of transactions. However, the notices were returned un-served. Thereafter, the AO asked the assessee to produce the above parties before him for examining the genuineness of purchase/expense. However, the assessee could not produce the said parties. The AO recorded that the assessee failed to furnish the requisite evidence in the form of payment of VAT by the alleged supplier, goods held as per the stock register of the alleged suppliers etc. In the above case, the assessee submitted before the AO that the alleged parties may be summoned u/s 131 of the Act. But the AO observed that the same is not tenable as notice u/s 133(6) sent to the available address was returned back and therefore, issuance of summons u/s 131 will be a fruitless exercise. The AO observed that in the instant case, neither the assessee could give the new address nor could he produce the said parties for examination. Further, the AO noted that the assessee failed to bring on record the relevant documentary evidence in the form of goods receipt note Anantrai Kar (GRN), goods/work completion note, lorry receipts etc. with supporting documentary evidence. Therefore, relying on the decision of the Hon’ble Gujarat High Court in the case of CIT v. Simit P. Sheth (2013) 356 ITR 451 (Guj), the AO estimated the profit @ 12.5% on the total bogus purchases of Rs.24,88,08,481/- which comes to Rs.3,11,01,060/-. 3.1 On perusal of the balance sheet the AO observed that the assessee had received unsecured loan of Rs.18,50,005/- in cash during the year. During the course of assessment proceedings, the AO asked the assessee to prove the genuineness of transaction. However, the assessee failed to submit any reply in this regard. Therefore, relying on the various case laws, the AO made an addition of unsecured loan of Rs.18,05,005/- u/s 68 of the Act.
Aggrieved by the order of the AO, the assessee filed an appeal before the Ld. CIT(A). We find that the Ld. CIT(A) agreed with the reasons given by the AO and dismissed the appeal filed by the assessee.
Before us, the Ld. DR supports the order passed by the Ld. CIT(A).
We have heard the Ld. DR and perused the relevant materials on record. As regards the 1st ground of appeal
, we find that the Ld. CIT(A) has given proper and sufficient opportunity to the assessee before passing the appellate order. As regards the 2nd ground of appeal, it is found that the notices issued by the AO u/s 133(6) to the 14 suppliers were returned back ‘un- served’. The assessee failed to furnish before the AO evidence in the Anantrai Kar (GRN), lorry receipts, payment of VAT by the alleged supplier etc. Also the assessee failed to produce the above parties before the AO to ascertain the genuineness of the purchases. Thereafter, the AO has rightly estimated profit @ 12.5% on such purchases. As regards the 3rd ground of appeal, we find that the assessee failed to submit any reply to prove the genuineness of the transaction. It is settled law that in order to discharge the onus u/s 68, the assessee must prove the following :
1. The identity of the creditor,
2. The capacity of the creditor to advance money; and 3. The genuineness of the transaction As the assessee in the instant case failed to adduce evidence to establish prima facie the aforesaid, the AO has rightly made an addition of Rs.18,05,005/- u/s 68 of the Act.