Income Tax Appellate Tribunal - Mumbai
Dcit 15(3)(1), Mumbai vs Techno Infracon P.Ltd, Mumbai on 8 September, 2017
ITA No.3705/M/2017 Techno Infracon Private Limited Assessment Year 2010-11 आयकर अपीलीय अिधकरण "बी" ायपीठ मुं बई म ।
IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH, MUMBAI ी महावीर िसंह, ाियक सद एवं ी मनोज कुमार अ वाल, लेखा सद के सम ।
BEFORE SHRI MAHAVIR SINGH, JM AND SHRI MANOJ KUMAR AGGARWAL, AM आयकर अपील सं./I.T.A. No. 3705/Mum/2017 (िनधा रण वष / Assessment Year: 2010-11) Deputy Commissioner Of Income Tax Techno Infracon Pvt. Ltd.
15(3)(1) H-220,2nd Floor, IIP R.No.451,4th Floor बनाम/ Above Vashi Railway station, Aaykar Bhavan Vs. Vashi M.K.Road Navi Mumbai - 400 703 Mumbai - 400 020
थायी ले खा सं . /जीआइआर सं ./PAN/GIR No. AACCT-8276-E (अ पीलाथ! /Appellant) : ("#थ! / Respondent) Assessee by : None Revenue by : Suman Kumar, Ld. DR सुनवाई की तारीख / : 07/09/2017 Date of Hearing घोषणा की तारीख / : 08 /09/2017 Date of Pronouncement 2 ITA No.3239/M/2017 Sunjyot Gems Assessment Year 2007-08 आदे श / O R D E R Per Manoj Kumar Aggarwal (Accountant Member)
1. The captioned appeal by revenue for Assessment Year [AY] 2010- 11 assails the order of the Ld. Commissioner of Income-Tax (Appeals)- 24 [CIT(A)], Mumbai dated 10/02/2017 qua relief provided to assessee against certain bogus purchases. None has appeared for assessee despite notice. Left with no option, we proceed to dispose-off the same on the basis of material available on record and after hearing Ld. Departmental Representative [DR].
2.1 Briefly stated the assessee being resident corporate assessee engaged as civil contractor, was subjected to an assessment u/s 143(3) read with section 147 for impugned AY on 16/12/2015 at Rs.1,82,93,853/- after addition of certain bogus purchases for Rs.84,91,599/-. The original return of income was filed on 15/10/2010 at Rs.98,02,250/- which was processed u/s 143(1). 2.2 The reassessment proceedings were initiated upon receipt of certain information from Sales Tax Department, Maharashtra regarding dealers indulging in bogus purchases bills and it was noted that the assessee stood beneficiary of such bogus purchase bills to the tune of Rs.84,91,599/- from eleven parties. Consequently, notice u/s 148 dated 19/03/2015 was issued to the assessee which was followed by statutory notices u/s 143(2) and 142(1).
2.3 The assessee produced ledger extracts, invoices, delivery challans, bank statements reflecting payment to said parties etc. and 3 ITA No.3239/M/2017 Sunjyot Gems Assessment Year 2007-08 contended that the purposes were genuine. However Ld. AO noted that the assessee could neither produce any of the party nor filed any confirmation to substantiate the transactions and hence, the purchases were bogus purchases and added the same to the income of the assessee.
3. Aggrieved, the assessee contested the same with partial success before Ld. CIT(A) vide impugned order dated 10/02/2017 where Ld. CIT(A) noted that the consumption of material and turnover was not disputed by the revenue. Finally, placing reliance on the decision of Hon'ble Gujarat High Court in CIT Vs. Simit P. Sheth [2013 38 taxmann.com 385], the impugned additions were restricted to 12.5%. Aggrieved, the revenue is in further appeal before us.
4. The Ld. DR placed reliance on the findings of Ld. AO and contended that full additions were justified since assessee could not furnish requisite confirmations.
5. We have heard the contentions and perused relevant material on record. We are of the considered opinion that there could be no sale without purchase / consumption of material keeping in view the assessee's nature of business which was material intensive and could not be carried out without consumption of material. The sales turnover achieved by the assessee has not been disputed by the revenue and the payments were through banking channels. The purchases were backed by invoices. At the same time, the assessee could not substantiate actual delivery of material and also could not produce any confirmations etc. from the alleged bogus suppliers, which cast serious doubt on 4 ITA No.3239/M/2017 Sunjyot Gems Assessment Year 2007-08 assessee's claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit element earned by assessee against possible purchase of material in the grey market and undue benefit of VAT against bogus purchases, which Ld. CIT(A) has rightly done. Therefore, finding the same to be very fair and reasonable, we confirm the same.
6. Resultantly, the revenue's appeal stands dismissed.
Order pronounced in the open court on 08th September, 2017.
Sd/- Sd/-
(Mahavir Singh) (Manoj Kumar Aggarwal)
ाियक सद / Judicial Member लेखा सद / Accountant Member मुंबई Mumbai; िदनां क Dated : 08. 09.2017 Sr.PS:- Thirumalesh आदे श की ितिलिप अ !े िषत/Copy of the Order forwarded to :
1. अपीलाथ! / The Appellant
2. "#थ! / The Respondent
3. आयकर आयु*(अपील) / The CIT(A)
4. आयकर आयु* / CIT - concerned
5. िवभागीय "ितिनिध, आयकर अपीलीय अिधकरण, मुंबई / DR, ITAT, Mumbai
6. गाड/ फाईल / Guard File आदे शानुसार/ BY ORDER, उप/सहायक पं जीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, मुंबई / ITAT, Mumbai