Income Tax Appellate Tribunal - Mumbai
Ramesh Kumar Savalchand Jain, Mumbai vs Ito - 19 (3)(1), Mumbai on 14 November, 2019
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCHES "D", MUMBAI
BEFORE SHRI PRAMOD KUMAR (VP) AND SHRI RAM LAL NEGI (JM)
SA No. 422/MUM/2019
Arising out of ITA No. 5679/MUM/2018)
Assessment Year: 2009-10
SA No. 423/MUM/2019
Arising out of ITA No. 5264/MUM/2019)
Assessment Year: 2010-11
&
SA No. 424/MUM/2019
Arising out of ITA No. 5263/MUM/2019)
Assessment Year: 2011-12
Ramesh Kumar Savalachand The Income Tax Officer
Jain, 19(3(1),
53/57, Bhandari Street, Room No. 202, Matru Mandir,
1st Kumbharwada, Vs. 2nd Floor, Tardeo,
Mumbai - 400004 Mumbai - 400007
PAN : AACPJ0692D
(Appellant) (Respondent)
Assessee by : Shri Praful L. Vora(AR)
Revenue by : Shri Michael Jerald (DR)
Date of Hearing: 08/11/2019
Date of Pronouncement: 14/11/2019
आदे श / O R D E R
PER RAM LAL NEGI, JM
The applicant/appellant has moved the present applications for grant of stay on recovery of demand raised by the department for the assessment years 2009-10, 2010-11 and 2011-12 amounting to Rs 5,10,000/- Rs. 2,55,480/- Rs. 71,910/-respectively. Since, all the three applications pertain to the same assessee and the issues involved are common, these were clubbed, heard together and are being disposed of by this common and consolidated order for the sake of convenience.
2SA Nos. 422, 423 & 424 /MUM/2019 Assessment Years: 2009-10, 2010-11 & 2011-12
2. The brief facts emanating from the pleadings of the parties and the record of the case are that the applicant/assessee, proprietor of M/s Mahalaxmi Steel Industry, engaged in the business of Merchant Trader in Steel and other metals, filed its return of income for the relevant assessment years under consideration. The cases were reopened u/s 147 of the Income Tax Act (for short the Act) by issuing notice u/s 148 of the Act on the basis of information received from the Sales Tax Department, Maharashtra through the DGIT Investigation Wing, Mumbai to the effect that the assessee during the assessment years under consideration obtained bogus purchase bills from 'hawala' dealers, who used to issue bogus bills/accommodation entries on commission basis without making delivery of goods. Accordingly, the AO passed assessment orders pertaining to the aforesaid assessment years u/s 143 (3) read with section 147 of the Act and made addition of 12.5% of the total amount of alleged bogus purchases made by the assessee in all the three assessment years. In the first appeal, the Ld. CIT (A) confirmed the additions made by the AO. The assessee has challenged the impugned orders passed by the Ld. CIT (A) vide ITA No. 5679/MUM/2019, ITA No. 5264/MUM/2019 and ITA No. 5263/MUM/2019 respectively.
3. The Ld. counsel for the assessee submitted before us that that the assessee has challenged the impugned orders on legal ground as well as on merits. The Ld. counsel further submitted that the findings of the Ld. CIT(A) are erroneous as the same are contrary to the evidence on record. The Ld. counsel further submitted that since the authorities below have made addition contrary to the principles of law laid down by the courts of Law, the assessee has a prima facie good case in its favour. The Ld. counsel further submitted that in case the demand is not stayed, great financial hardship will be caused to the assessee. The Ld. counsel accordingly submitted that these applications may be allowed and the recovery of demands may be stayed and department may be restrained from taking any coercive methods for recovery of the outstanding demands during pendency of these appeals.
3SA Nos. 422, 423 & 424 /MUM/2019 Assessment Years: 2009-10, 2010-11 & 2011-12
4. On the other hand, the Ld. Departmental Representative (DR) opposed the application for stay of demand on the ground that the assessee has obtained bogus bills from hawala dealers and during the assessment proceedings or the appellate proceedings, the assessee failed to discharge its onus of proving the genuineness of the transaction of purchases in question. Since, the additions are on account of bogus purchases shown by the assessee, there is no merit in the contention of the assessee and therefore, the question of granting stay on recovery does not arise.
5. We have heard the rival submissions of the parties and also perused the material on record. As pointed out by the Ld. DR, the Ld. CIT (A) has confirmed the addition of 12.5% of the total amount of bogus purchases in all the three years made by the AO on estimation basis. Since, the additions made in all the three appeals are on account of bogus purchases and on estimation basis in the light of the principle laid down by the Hon'ble Gujarat High Court in the case of CIT vs. Simit P. Sheth 356 ITR 541 (Guj), we do not find any merit in the contention of the assessee that the balance of convenience is in favour of the assessee and the assessee will suffer financial hardship in case demand is not stayed. Hence, in view of the facts and circumstances of the case, we are of the considered view that these are not the fit cases for granting stay on recovery of demands. However, in view of the nature of additions made in these cases, these appeals can be heard on priority basis.
6. We accordingly reject the applications for granting stay on recovery of outstanding demands pertaining to the assessment years 2009-10, 2010-11 and 2011-12 and fix the case for early hearing on 12.12.2019.
In the result, applications for grant of stay on demands pertaining to the assessment years 2009-10, 2010-11 and 2011-12 are dismissed.
Order pronounced in the open court on 14th November, 2019 Sd/- Sd/-
(PRAMOD KUMAR) (RAM LAL NEGI)
VICE PRESIDENT JUDICIAL MEMBER
4
SA Nos. 422, 423 & 424 /MUM/2019
Assessment Years: 2009-10, 2010-11 & 2011-12
मुंबई Mumbai; दिन ुं क Dated: 14/11/2019
Alindra, PS
आदे श प्रतितिति अग्रे तिि/Copy of the Order forwarded to :
1. अपीलार्थी / The Appellant
2. प्रत्यर्थी / The Respondent.
3. आयकर आयुक्त(अपील) / The CIT(A)-
4. आयकर आयुक्त / CIT
5. विभागीय प्रविविवि, आयकर अपीलीय अविकरण, मुुं बई / DR, ITAT, Mumbai
6. गार्ड फाईल / Guard file.
आदे शानु सार/ BY ORDER, सत्यावपि प्रवि //True Copy// उि/सहायक िं जीकार (Dy./Asstt. Registrar) आयकर अिीिीय अतिकरण, मुुं बई / ITAT, Mumbai