ITO WD 1(1), KALYAN vs. ALPESH SURESH JAIN, BHIWANDI

The present appeal has been preferred by the Revenue against the order dated 30.11.2016 of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2010-11.

The brief facts of the case are that the assessee is an individual engaged in the business of trading of scraps & job work on P.L. During the year the Assessing Officer (hereinafter referred to as the AO) found that assessee had made bogus purchases from following parties:

The assessee was asked to produce the above parties for verification. There was no compliance of notice under section 133(6). Therefore, the AO has made the addition on account of bogus purchases.

Matter carried to the Ld. CIT(A) and the Ld. CIT(A) has partly allowed the claim by observing as under: “8.13 From these facts it is proved that the appellant might have affected the purchases from the grey markets (which are not open for verification) and procured the bill from above hawala parties. Therefore, relying on the ratio led down by Hon’ble Haipur ITAT, the disallowance @ 15% of the hawala purchases, in this case, will be a logical course. Accordingly, the disallowance @ 15% of Hawala purchases is worked out at Rs.8,99,856/- (15% of Rs.59,99,037/-) for AYr 2010-11 & Rs.5,59,564/- (15% of Rs.37,30,424/-) for AYr 2011-12. Keeping in view the above facts, the disallowances to the extent of Rs.8,99,856/- & Rs.5,59,564/-, in these years, are sustained and balance amounts of Rs.50,99,180/- & Rs.31,70,860/-, respectively, are deleted. Both the grounds of appeal are disposed off accordingly.”

We have heard the rival contentions of both the parties. We find that the issue in controversy is already covered by the decision of the Tribunal in the own case of the assessee for A.Y. 2011-12 in ITA No.1063/M/2017. Applying the same ratio followed in the above cited case, we find no justification to interfere with the order

In the result, departmental appeal is dismissed. Order pronounced in the open court on 20.09.2017.