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2019 (8) TMI 1202 - ITAT MUMBAIValidity of Reassessment order u/s 144 r.w.s 147- tangible material - addition on account of non–genuine purchases - HELD THAT:- Undisputedly, in assessee’s case there was no scrutiny assessment earlier and the return of income filed by the assessee was only processed u/s 143(1). Subsequently, material came to the possession of the Assessing Officer indicating that the assessee had availed accommodation entries by way of bogus purchase bills. Therefore, in our considered opinion, the AO had sufficient tangible material available before him to form belief that income chargeable to tax has escaped assessment. That being the case, the re–opening of assessment u/s 147, in our view, is valid. Bogus purchases - HELD THAT:- Undisputedly, before AO the assessee had not furnished any evidence to prove the genuineness of purchases allegedly made from hawala operators. Therefore, he added such purchases to the income of the assessee. Commissioner (Appeals) has even added back the rest of the purchases to the income of the assessee. To a query from the Bench as to whether the assessee can furnish quantitative details to show purchases and consumption of material in construction activity, the learned Authorised Representative submitted, given an opportunity, the assessee would furnish the details before the AO. In view of the aforesaid submission of the learned Authorised Representative, we are inclined to restore the issue to the AO for de novo adjudication after due opportunity of being heard to the assessee. Accordingly, grounds raised in the memorandum of appeal are allowed for statistical purposes. Penalty u/s 271(1)(c) - HELD THAT:- Restored the issue relating to the addition made on account of non–genuine purchases to the Assessing Officer for de novo adjudication. Thus, for the present, the addition made does not survive. That being the case, penalty imposed u/s 271(1)(c) on such addition cannot survive. Accordingly, we set aside the impugned order of learned Commissioner (Appeals) sustaining the penalty imposed u/s 271(1)(c)
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