TMI Blog2020 (6) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... words ordinarily , in the light of the above analysis of the legal position, the period during which lockout was in force is to excluded for the purpose of time limits set out in rule 34(5) of the Appellate Tribunal Rules, 1963. Exception, to 90- day time-limit for pronouncement of orders, inherent in rule 34(5)(c), with respect to the pronouncement of orders within ninety days, clearly comes into play in the present case. Of course, there is no, and there cannot be any, bar on the discretion of the benches to refix the matters for clarifications because of considerable time lag between the point of time when the hearing is concluded and the point of time when the order thereon is being finalized, but then, in our considered view, no such exercise was required to be carried out on the facts of this case. - I.T.A. No. 6133/Mum/2018 - - - Dated:- 27-5-2020 - Shri Pramod Kumar, Hon ble Vice President And Ms. Madhumita Roy, Hon ble Judicial Member For the Assessee : Shri A.N. Shah, AR For the Revenue : Shri Sanatha Mullamudi, D/R ORDER PER MS. MADHUMITA ROY, JM The instant appeal filed by the Revenue is directed against the order dated 19.07.2018 passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. Further that the parties from whom purchases were made which were alleged to be bogus was considered for disallowance at 25% in the assessment proceedings u/s 143(3) of the Act. Such disallowance was subsequently restricted by the Ld. CIT(A) to 12.5% on the purchases in respect of four parties except M/s. Prince Trading Company Therefore, ultimately the Ld. AO disallowed 12.5% of the purchase of ₹ 57,77,025/- made from the said M/s. Prince Trading Company i.e. the quantum of profit element involved on account of inflation of purchases. Before the First Appellate Authority, the assessee submitted that the figures specified by the Revenue are inclusive of VAT amounting to ₹ 7,22,128/-; details whereof were duly enclosed. It was pointed out by the Learned AR that the same has to excluded while arriving at the quantum of alleged purchases of ₹ 57,77,025/-. Apart from that there was actual delivery of goods by the suppliers which are evident from the invoices of the parties as also submitted by the Learned AR. The Learned AR further argued that the details of purchases including the copies of ledger of parties, the copies of invoices containing address, the TIN (sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order impugned that time and again relying on several judgements including in the matter of Shri Madhukant B. Gandhi vs. ITO passed by the Coordinate Bench, the Ld. CIT(A) concluded that the entire purchase cannot be disallowed but only the profit embedded in the doubtful transaction has to be taxed. The judgement passed by the Hon'ble Gujarat High Court in the case of CIT vs. Bholanath Poly Fab Pvt. Ltd. reported in 355 ITR 290 (Guj) has also been taken care of by the Ld. CIT(A) where the facts are identical. Taking into consideration the entire facts of the matter we find that the Ld. CIT(A) further opined that assessee has made cash purchases from other parties though those were not recorded in the books of accounts otherwise the sales made could not have taken place. The assessee took bills only from the five parties as accommodation to explain such purchases. Having regard to the particular aspect of the matter when the appellant has already recorded a Gross Profit of 3.56% in his books and the sales has not been doubted, we find no ambiguity in restricting such disallowance to 5% of the alleged bogus purchases by the Ld. CIT(A) so as to warrant interference. Hence we fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pression ordinarily has been used in the said rule itself. This rule was inserted as a result of directions of Hon ble jurisdictional High Court in the case of Shivsagar Veg Restaurant Vs ACIT [(2009) 317 ITR 433 (Bom)] wherein Their Lordships had, inter alia, directed that We, therefore, direct the President of the Appellate Tribunal to frame and lay down the guidelines in the similar lines as are laid down by the Apex Court in the case of Anil Rai (supra) and to issue appropriate administrative directions to all the Benches of the Tribunal in that behalf. We hope and trust that suitable guidelines shall be framed and issued by the President of the Appellate Tribunal within shortest reasonable time and followed strictly by all the Benches of the Tribunal. In the meanwhile(emphasis, by underlining, supplied by us now), all the revisional and appellate authorities under the Income-tax Act are directed to decide matters heard by them within a period of three months from the date case is closed for judgment . In the ruled so framed, as a result of these directions, the expression ordinarily has been inserted in the requirement to pronounce the order within a period of 90 days. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al calamity and FMC (i.e. force majeure clause) may be invoked, wherever considered appropriate, following the due procedure . The term force majeure has been defined in Black s Law Dictionary, as an event or effect that can be neither anticipated nor controlled When such is the position, and it is officially so notified by the Government of India and the Covid-19 epidemic has been notified as a disaster under the National Disaster Management Act, 2005, and also in the light of the discussions above, the period during which lockdown was in force can be anything but an ordinary period. 10. In the light of the above discussions, we are of the considered view that rather than taking a pedantic view of the rule requiring pronouncement of orders within 90 days, disregarding the important fact that the entire country was in lockdown, we should compute the period of 90 days by excluding at least the period during which the lockdown was in force. We must factor ground realities in mind while interpreting the time limit for the pronouncement of the order. Law is not brooding omnipotence in the sky. It is a pragmatic tool of the social order. The tenets of law being enacted on t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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