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Income Tax Appellate Tribunal, “J” BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY & SHRI MANOJ KUMAR AGGARWAL
Aforesaid appeal by the assessee is directed against the order dated 15th December 2015, passed by the learned Commissioner (Appeals)–32, Mumbai, for the assessment year 2009–10.
The assessee, an individual, is engaged in the business of trading in flanges, tube fittings and iron and steel. For the assessment year under consideration, he filed his return of income on 29th September 2009. On the basis of information received from the Sales Tax
2 Shri Jagat Singh Department that purchases effected by the assessee from certain dealers are only in the nature of accommodation bills without actual delivery of goods, the Assessing Officer re–opened the assessment under section 147 of the Act. During the assessment proceedings, on the basis of information available on record, the Assessing Officer found that the assessee had made bogus purchases as under:–
Siddhivinayak Steel 2008–09 17,25,521 2008–09 Chanchal Tube Corp. 19,78,460 2008–09 Asian Steel 19,13,387 2008–09 Surat Tube Corp. 30,88,112 2008–09 Shiv Industries 16,56,320 2008–09 1,16,67,977 Maruti Steel Traders Total 1,16,67,977
The Assessing Officer, therefore, called upon the assessee to produce necessary evidence for proving the genuineness of the purchases. In response, the assessee submitted his explanation claiming the purchases to be genuine. In support of such claim, assessee stated to have furnished copies of purchase bills, bank statement showing payment through cheque, ledger account copies, etc. However, the Assessing Officer was not convinced with the explanation of the assessee. Therefore, to ascertain the real nature of transaction, the Assessing Officer issued notices under section 133(6) of the Act to the concerned parties. However, as observed by him all
3 Shri Jagat Singh such notices returned un–served. He, therefore, called upon the assessee to produce the concerned parties, which the assessee failed to do. The Assessing Officer, therefore, concluded that purchases cannot be said to be genuine. He, therefore, proceeded to estimate profit @ 12.5% on the bogus purchases which worked out to ` 14,58,497 and added back the same to the income of the assessee. Being aggrieved of the addition so made, assessee preferred appeal before the learned Commissioner (Appeals).
The learned Commissioner (Appeals) also sustained the addition made by the assessee.
When the appeal was called for hearing no one was present on behalf of the assessee. It is pertinent to note here, on 16th November 2016, when the appeal was earlier fixed for hearing, Ms. Sanjukta Chowdhury, learned Counsel, made an oral request for adjournment of the appeal. However, when the bench made a query whether she is authorised by the assessee to make such request, she submitted that letter of authority would be filed on the next day i.e., 17th November 2016. Accordingly, appeal was adjourned to 17th November 2016. When the appeal was called for hearing on 17th November 2016, no one appeared on behalf of the assessee nor there is a petition seeking adjournment. Therefore, we proceed to dispose off the appeal ex–
4 Shri Jagat Singh parte qua the assessee after hearing the learned Departmental Representative.
We have heard the learned Departmental Representative and perused the material on record. It is evident, on the basis of information available indicating that the assessee has indulged in bogus purchases, the Assessing Officer had re–opened the assessment under section 147 of the Act. During the assessment proceedings, it came to the notice of the Assessing Officer that some of the parties from whom the assessee claimed to have made purchases are appearing in the list of hawala dealers prepared by the Sales Tax Department. In fact, as per the information available with the Assessing Officer before the sales tax authorities concerned parties have accepted / admitted that they are only provided accommodation bills without actual supply of goods. It is also evident on record during the assessment proceedings, the Assessing Officer not only brought all these information to the notice of the assessee but for ascertaining the genuineness of the purchases conducted enquiry by issuing notice under section 133(6) of the Act. However, as stated by the Assessing Officer, all these notices returned back un–served. When the Assessing Officer called upon the assessee to produce the concerned parties, he failed to do so. In fact, the assessee even failed to obtain confirmations from the concerned parties in support of purchases
5 Shri Jagat Singh made. Thus, prima–facie it appears, the assessee has failed to prove the genuineness of the purchases under dispute with valid evidence. In these circumstances, the estimation of profit at 12.5% of the un– proved purchases, in our view, is reasonable, hence, do not call for any interference. The ground raised is, therefore, dismissed.
As far as levy of interest is concerned, the same being mandatory and consequential, there is no need to interfere with the same.
In the result, appeal stands dismissed. Order pronounced in the open Court on 30.11.2016