TMI Blog2017 (11) TMI 1141X X X X Extracts X X X X X X X X Extracts X X X X ..... 5840/MUM/2015 (Assessment Year: 2009-10) Brief facts of the case are that the assessee M/s Rizvi Land Development Pvt. Ltd. filed its return of income for the assessment year 2009-10 declaring the total income of ₹ 9,28,09,526/-. The return was assessed u/s 143 (3) of the Act. 2. Subsequently, on the basis of information received from the Sales Tax Department Maharashtra, through Directorate General of Income Tax (Inv.), Mumbai regarding bogus purchases made by various companies including the present assessee, the assessment was re-opened u/s 147 of the Act. The assessee was one of the companies, which had made bogus purchases from the said entities. As per the information, the assessee company during the year relevant to the assessment year under consideration made bogus purchases to the tune of ₹ 1,04,30,084/- from the bogus entities i.e. Vardhman International and Maharaja Impex. 3. The assessee objected the re-opening, however, the assessee s objection was rejected. During the re-assessment proceedings, the assessee could not establish the genuineness of the transaction. Accordingly, show cause notice was issued as to why the amount of bogus purchases sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat situation this logic is not correct that since the sales are there purchases can not be denied. 6. Before us, the Ld. Departmental Representative (DR) submitted that the Ld.CIT (A) has wrongly restricted the addition to 10% of the total bogus purchases made by the assessee during the relevant year. Since, the assessee has failed to prove genuineness of the transaction, the Ld. CIT(A) ought to have confirmed the addition made by the AO. 7. On the other hand, the Ld. counsel for the assessee submitted that since the assessee has submitted the copies of bills, delivery challans, bank statements, utilization certificate from the site engineer, the Ld. CIT (A) has wrongly sustained the addition to 10% of the total alleged bogus purchases. The Ld. counsel further submitted that the action of AO of re-opening of assessment order itself is invalid and bad in law and the Ld. CIT (A) has wrongly upheld the re-opening of the assessment. The Ld. counsel further submitted that the assessee has also filed cross objection challenging the validity of proceedings initiated u/s 147 of the Act..Placing reliance on the decision of Hon ble Supreme Court rendered in CIT Vs. Orissa Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue and direct the AO to compute the addition @ 12.5% of the total amount of bogus purchases. CO No. 177/MUM/2017 (Assessment Year: 2009-10) The assessee has filed the cross objection against the impugned order on the following effective ground: On the facts and in the circumstances of the case and in law, the proceeding initiated u/s 147 is invalid and bad in law and the learned C.I.T. (A) erred in upholding the re-opening of assessment and the validity of the assessment order passed u/s 143 (3) r.w.s. 147 of the act. 2. Since, there is a delay of 13 days in filing the present cross objection, the Ld. counsel for the assessee submitted that the application for condonation of delay filed by the assessee may be allowed and the delay may be condoned. The Ld. counsel further submitted that the delay has been caused due to the circumstances beyond control of the assessee therefore, there was sufficient cause for not presenting the cross objection within the limitation period. 3. On the other hand, the Ld. departmental representative (DR) opposed the application and submitted that the reason mentioned in the application is not sufficient to condone the dela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. 6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so. 6. In view of the law laid down by the Hon ble Supreme Court in the aforesaid case, we allowed the application of the assessee for condonation of delay and allowed the counsel for the assessee to argue the case on merit. 7. The Ld. counsel submitted that reopening of assessment is bad in law as the same has been done on the basis of information received from Sales Tax Department through the Directorate General of Income Tax (Inv.), Mumbai. The Ld. counsel relying on the decision of the Hon ble Gujarat High Court rendered in CIT vs. M.K. Brothers (163 ITR 249) (Guj) and decisions of Mumbai Tribunal in Balaji Textiles Industries Ltd. Vs. ITO (49 ITD 177) (Mum), DCIT vs. Rajeev G Kalathil (ITA NO. 6727/Mum/2012), Ramesh Kumar Co. Vs. ACIT (ITA No. 2959/Mum/2014) submitted that since the action of AO is bad in law, the Ld. CIT(A) oug ..... X X X X Extracts X X X X X X X X Extracts X X X X
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