THE JT. CIT, RANGE-9, AHMEDABAD vs. M/S. VASANI BUILDERS, AHMEDABAD

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ITA 1214/AHD/2015Status: DisposedITAT Ahmedabad18 September 2017AY 2011-124 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal dismissed the Revenue's appeal due to low tax effect, following a CBDT circular. The assessee's cross-objection was also dismissed as the CIT(A) had already provided relief.

What were the facts?

The Revenue appealed against the deletion of disallowance for bogus purchases. The assessee filed a cross-objection challenging the partial disallowance on unverifiable purchases and vehicle expenses.

What were the issues?

Whether the disallowance for bogus purchases and vehicle expenses was justified, and whether the Revenue's appeal should be withdrawn due to low tax effect.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 133(6)

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, AHMEDABAD “C” BENCH

Before: Shri S. S. Godara & Shri Amarjit Singh

For Appellant: Shri Gulab Thakor, A.R
For Respondent: Shri Prasoon Kabra, Sr. D.R, Shri Gulab Thakor, A.R

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “C” BENCH Before: Shri S. S. Godara, Judicial Member And Shri Amarjit Singh, Accountant Member ITA No. 1214 & CO No. 93/Ahd/2015 Assessment Year 2011-12

Dy. Commissioner of M/s. Vasani Builders Income Tax, Circle-5(3) F/1 Trimurti Complex, Ahmedabad Vs India Colony Road, (Appellant/Respondent) Nr. Approach Bus Stand, T B Nagar, Ahmedabad PAN: AADFV0533A (Respondent/Cross Objector)

Revenue by: Shri Prasoon Kabra, Sr. D.R. Assessee by: Shri Gulab Thakor, A.R.

Date of hearing : 30-08-2017 Date of pronouncement : 18-09-2017 आदेश/ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:-

This Revenue’s appeal and assessee’s CO for A.Y. 2011-12, arise from order of the CIT(A)-5, Ahmedabad dated 16-02-2015 , in proceedings under section 143(3) of the Income Tax Act, 1961; in short “the Act”.

I.T.A No. 1214 & CO No. 93/Ahd/2015 A.Y. 2011-12 Page No 2 Dy. CIT vs. M/s. Vasani Builders

ITA No. 1214/Ahd/2015 filed by revenue

2.

The Revenue’s sole substantive ground challenges the lower appellate order deleting the disallowance made on account of bogus purchase of Rs. 23, 51, 336/- made in assessment order dated 27- 03-2014. There is no dispute that the net tax effect in the instant appeal is less than Rs. 10 lacs. We find that the Central Board of Direct Taxes; hereafter the ‘Board’ has issued the circular no. 21/2015 dated 10-12-2015 clearly envisaging therein that department’s pending appeals before the tribunal/high courts are to be withdrawn/not pressed as per the above stated circular. The same has been declared to be having retrospective effect in other words. We take into consideration the above stated Board’s circular and dismiss the instant appeal accordingly.

3.

This Revenue’s appeal is dismissed as having low tax effect.

CO No. 93/Ahd/2015 filed by assessee

4.

In this case, the assessing officer had made disallowance of Rs. 23,51,336/- of the unverifiable purchases @ 25% of the total purchases amounting to Rs. 94,05,346/-. The assessing officer has made disallowance on further considering the case of M/s.Vijay Proteins Ltd. vs. ACIT 58 ITD 428. The assessing officer could not verify the genuineness of the purchases as no compliance to notices issued u/s. 133(6) of the act was received. The assessee has also

I.T.A No. 1214 & CO No. 93/Ahd/2015 A.Y. 2011-12 Page No 3 Dy. CIT vs. M/s. Vasani Builders

not produced the persons for examination and verification before the assessing officer. However, the ld. CIT(A) has restricted the disallowance @ 5% to the amount of Rs. 7,05,400/- after placing reliance on the case of the Co-ordinate Bench of Gujarat Ambuja Export Ltd. vs. ACIT in IT(SS)A No. 123,124 & 428/Ahd/2012 dated 17th April, 2013 which was confirmed by the Hon’ble Jurisdictional High Court in Tax Appeal No. 845/Ahd/20 dated 10th Feb, 2014.

5.

We have heard rival contentions on this issue and perused the material on record. We observed that ld. CIT(A) has already provided relevant relief to the assessee, therefore , we do not find any merit in the cross objection petition of the assessee and the same is dismissed.

Vehicle Expenses Disallowance of Rs. 1,14,166/-

6.

During the course of assessment proceedings, the assessing officer has made disallowance of 20% of vehicle expenses on the ground that assessee has not produced documentary evidences like log book etc. to justify the claim of the expenditure. The Ld.CIT(A) has restricted the disallowance @ 10% of Rs. 1,14,166/-.

7.

We have heard rival contentions. We find that even in the appellate proceedings, the assessee could not demonstrate the maintenance of log book and supporting evidences .In view of above

I.T.A No. 1214 & CO No. 93/Ahd/2015 A.Y. 2011-12 Page No 4 Dy. CIT vs. M/s. Vasani Builders

facts we do not find any error in the decision of the ld. CIT(A) who has already reduced the disallowance from 20% to 10%. Therefore, the CO of the assessee stand dismissed.

8.

In the combined result, the appeal filed by revenue and CO filed by assessee are dismissed.

Order pronounced in the open court on 18-09-2017

Sd/- Sd/- (S.S. GODARA) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad : Dated 18/09/2017 आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद

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