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Income Tax Appellate Tribunal, “SMC”, BENCH MUMBAI
Before: SHRI R.C.SHARMA, AM
आदेश / O R D E R PER R.C.SHARMA (A.M): This is an appeal filed by the assessee against the order of CIT(A)- 2, Thane dated 31/03/2017 for the A.Y.2009-10 in the matter of order passed u/s.143(3) r.w.s.147 of the IT Act. 2. The only grievance of assessee relates to 100% addition made by the AO on account of bogus purchases by invoking provisions of Section 69C of the IT Act. 3. Rival contentions have been heard and record perused. In this case the AO has received information from the Sales Tax Department that the assessee had affected purchases from M/s. Somnath International Rs.2,87,640/- which was declared as suspicious. The AO after recording M/s. Shriram Distributors necessary reasons for reopening, as per provisions of Sec. 147 of the IT Act, 1961, had issued notice u/s. 148 alongwith copy of reasons, which were duly served upon assessee. The AO treated the entire purchases from above referred party, as bogus and added Rs.2,87,640/- to the income of the assessee.
By the impugned order CIT(A) confirmed the action of the AO against which assessee is in further appeal before us.
It was contended by learned AR Shri Shashank Dundu that assessee has filed all the particulars of purchases so made alongwith quantitative details of purchases and corresponding sales so made. The assessee had also shown GP on the alleged bogus purchases equal to the GP shown on the normal purchases. He further placed on record various judicial pronouncements and contended that addition should be restricted to 12.5% less GP already declared by assessee.
I have considered rival contentions and carefully gone through the orders of the authorities below and found from record that the assessee is a distributor of edible oil. The assessee had filed its return of Income on 10/09/2009. The learned I.T.O reopened the assessment on information of Sales Tax Dept. The assessee had explained vide his letter dt 20/03/2014 submitted to I.T.O on 21/03/2014 along with various details & explanations. The Sales Tax number of the assessee was cancelled from 01/10/2010(as per tin details). It also showed the returns filing period for 2007-08 to 2010-11 which showed the dealer was filing returns for all above periods. The assessee had requested for cross check of the M/s. Shriram Distributors supplier. However, the I.T.O completed the assessment on the same day of hearing. However, learned I.T.O has relied strongly on affidavit of Shri Vinit Vinayak Gawade, a proprietor who states that he has done nothing hut received Rs.5000/- p.m from one person namely Tushar Ruparel. On one side he states he has received money but Tushar Ruparel have issued bogus bills to various parties out of his knowledge. The affidavit is contrary to statement & facts made therein. In view of the same, the affidavit is of no use & not reliable. I found that the assessee has already paid Rs.66612 towards Sales Tax liability. There is no dispute to the fact that assessee had shown corresponding sales of the goods so purchased on which GP was declared equal to the GP shown on the normal purchases. Therefore, keeping in view totality of facts and circumstances of the case, I modify the order of the lower authorities and direct the AO to restrict the addition to the extent of 12.5% less GP already shown by the assessee which is 03.22%. I direct accordingly.
In the result, appeal is allowed in part.