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2020 (1) TMI 157 - ITAT DELHIReopening of assessment u/s 147 - bogus software purchase - HELD THAT:- A perusal of the assessment order framed u/s 143(3) r.w.s 147 of the Act shows that entire assessment order is devoid of any reference to the statement of Shri S.K. Gupta. It is not known as to what question Shri S.K. Gupta said that M/s CFAM Soft [India] Pvt Ltd and M/s BT TechNet Ltd. were providing accommodation bills. Further, we find that the entire transactions have been done through A/c payee cheques and it is not the case of the Revenue that the appellant has purchased the accommodation bills by making payments through cheques and receiving cash through back door. It is pertinent to mention here that search operations at the premises of Shri S.K. Gupta were conducted on 12.12.2006 and original assessment order was framed u/s 143(3) of the Act vide order dated 10.07.2008. This means that the Assessing Officer had sufficient time to gather information relating to search conducted at the premises of Shri S.K. Gupta and yet the Assessing Officer accepted the transactions without making any enquiry. In our considered opinion, reasons for reopening the assessment are nothing but change of opinion which is not permissible as per the ratio laid down by the Hon'ble Supreme Court in the case of Kelvinator of India Ltd [2010 (1) TMI 11 - SUPREME COURT] as no new tangible material was in possession of the Assessing Officer. Therefore, notice u/s 148 of the Act is bad in law and assessment framed pursuant to the notice is also bad in law. The notice issued u/s 148 of the Act is bad in law and hence the same is set aside. The assessment so framed is quashed. Merits of the case the assessee has purchased software from M/s CFAM Soft [India] Pvt Ltd and M/s BT TechNet Ltd. The ld. DR vehemently stated that after the completion of assessment of these two companies, the Assessing Officer came to know that these two companies were providing accommodation bills and the assessee is one of the beneficiaries. However, we find that during the course of assessment proceedings also, the assessee filed confirmations from these two companies relating to the transactions done with them. The Assessing Officer did not even confront the assessee with his findings given in the case of these two companies nor did he make any enquiry in respect of the confirmations filed by the two companies. The assessee is into the business of call centre services and the nature of business activities is such that it requires latest and upgraded software. If the assessee did not purchase any new upgraded software and has only taken accommodation bills, then we fail to understand how the assessee generated revenue of ₹ 5.33 crores in F.Y. 2004-05 which jumped to ₹ 12.45 crores during the year under consideration. There is not even an iota of evidence produced on record by the Assessing Officer to demonstrate that even the sales of call centre services are bogus. Assessing Officer has accepted the net profit as per the books of account and merely on surmises and conjectures, treated the purchase of software as bogus yet allowing depreciation on software which is evident from the fixed assets schedule at page 8 of the paper book. In our considered view, since there is no demonstrative evidence brought on record to justify that the software purchase is bogus, we do not find any merit in the additions made by the Assessing Officer and accordingly, we direct the Assessing Officer to delete the impugned additions. - Decided in favour of assessee.
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