Income Tax Appellate Tribunal - Mumbai
Raheja Universal P. Ltd., Mumbai vs Dcit Cent. Cir. 4(2), Mumbai on 10 April, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL "I" BENCH, MUMBAI
BEFORE SRI MAHAVIR SINGH, JM AND SRI RAMIT KOCHAR, AM
ITA No.5192/Mum/2016
(A.Y:2011-12)
Raheja Universal P. Ltd. Dy. Commissioner of Income Tax,
Raheja Centre Point, 4 t h Floor, Circle 4(2)
294, Vidya Nagari Marg, CST Vs. Room No.1918, 19 t h Floor, Air
Road, Santacruz (E) India Building
Mumbai-400 098 Nariman Point, Mumbai-21
Appellant .. Respondent
PAN No. AABCG7955Q
Assessee by .. Shri Sunil K Ramani , AR
Revenue by .. Shri Sunil Kr. Agarwal, DR
Date of hearing .. 10-04-2017
Date of pronouncement .. 10-04-2017
ORDER
PER MAHAVIR SINGH, JM:
This appeal by the assessee is arising out of the order of CIT(A)-52, Mumbai, in appeal No. CIT(A)-52/DC-CC-4(2)/108/2015-16 dated 24-05-2016. The penalty was levied by DCIT Circle-4(2) under section 271(1)(c) of the Act vide order dated 15-09-2015.
2. The only issue in this appeal of assessee is against the order of CIT(A) confirming the action of the AO levying penalty under section 271(1)(c) of the Act amounting to Rs. 9,399/-.
3. We have heard the rival contentions and gone through the facts and circumstances of the case. Briefly stated facts are that the assessee filed its return of income declaring total income of Rs. 31,97,7,400/-on 30-09-2011 for the AY 2011-12. Original assessment was completed under section 143(3) of the Act on 30-12-2013 by assessing income at Rs. 32,04,21,202/-. Subsequently, the AO received information from the office of the DGIT investigation Mumbai, who in turn received information from Sales Tax Department of Maharashtra that the ITA No.5192/Mum /2016 Raheja Universal P. Ltd. AY:11-12 assessee has made purchase for an amount of Rs. 30,160/- from one hawala dealer indulging in issuing bogus bills without any actual delivery of goods. Accordingly, this amount of Rs. 30,160/- was added to the return of income of the assessee. The penalty proceedings under section 271(1)(c) of the Act was initiated. The AO levied the penalty despite the explanation filed by the assessee that the purchase from Mairu Enterprises was made towards purchases of Artificial Cricket Pitch with Machine and Side Removal Net Ball Pool with Side Effect from them for a sum of Rs. 30,160/- on 06-07-2010 also made payment by account payee cheque No. 375841 dated 06-07-2010. The assessee also enclosed copy of bank statement in support of above payment and claim that the purchase is genuine that the payment has been made by account payee cheque. It was claimed that this item have been purchased by assessee is very much transported by the assessee but the AO levied the penalty for the reason that the assessee has not preferred the appeal against the order of AO and that has become final.
4. Aggrieved assessee preferred the appeal before CIT(A), who also confirmed the action of the AO with the reason that "in response the assessed stated that these purchases were made towards purchase of a pool table and a table tennis from this party and the payments for the same were paid through cheque and copy of the bank account was also submitted. However, the assessee could not substantiate the above purchases with bill/ voucher, stock register inward register, outward register etc. and accordingly, the AO treated the same as bogus and made an addition of Rs. 30,160/- in the hands of the assessee."
5. Aggrieved against the action of the CIT(A), assessee preferred the second appeal before Tribunal. We have heard the rival contentions and gone through the facts and circumstances of the case. We find that one of the addition made to the return of income by an amount of Rs. 36,160/-, which represents payment toward purchases of Artificial Cricket Pitch with Machine and Side Removal Net Ball Pool with Side Effect. The assessee has recorded this purchase made from Mairu Enterprises Mumbai, and payment to them was also by account payee cheque No. 375841 dated 06-07-2010 drawn on HDFC Bank. The seller has also issued bill No. 0287dated 26-04-2010. We find that the assessee find has disclosed an income of Rs. 32.04 crore and it cannot be presumed that he might Page 2 of 3 ITA No.5192/Mum /2016 Raheja Universal P. Ltd. AY:11-12 have made bogus purchases of meager amount of Rs. 30,160/-. There is doubt in this regard. It is also a fact that payment has made by account payee cheque and drawn on HDFC Bank and proof thereof a copy of bank statement was enclosed before the lower authorities. In such circumstances we are of the view that penalty is not to be levied for concealment of income or for furnishing of inaccurate particulars of income particularly in view of the decision of the Hon'ble Bombay High Court in the case of CIT v Nikunj Eximp Enterprises Pvt. Ltd372 ITR 619(Bom) Wherein, Hon'ble Bombay High Court has held that where sales were supported and purchases are through account payee cheque payments, merely because supplier have not attended before the AO, purchase could be treated as bogus. In view of the above decision we are of the view that the assessee is on better footing taking the amount of purchase vis-à-vis the income declared by the assessee. In view of the above facts and circumstances and in peculiar facts of the case i.e. due to very smallness of amount of bogus purchase, we delete the penalty and allow the appeal of the assessee.
6. In the result, the appeal of assessee is allowed.
Order pronounced in the open court on 10-04-2017.
Sd/- Sd/-
(RAMIT KOCHAR) (MAHAVIR SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Mumbai, Dated: 10-04-2017
Sudip Sarkar /Sr.PS
Copy of the Order forwarded to:
1. The Appellant
2. The Respondent.
3. The CIT (A), Mumbai.
4. CIT
5. DR, ITAT, Mumbai
6. Guard file.
BY ORDER,
//True Copy// Assistant Registrar
ITAT, MUMBAI
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