Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (12) TMI 375 - AT - Income TaxValidity of re-assessment u/s.147 - addition made on account of in-genuine purchases - HELD THAT:- As entire legal procedure that were contemplated in the case of GKN Driveshafts (India) Ltd [2002 (11) TMI 7 - SUPREME COURT ] were duly complied with by th AO in the instant case. Hence for the aforesaid reasons, we hold that the ld. AO had validly assumed his jurisdiction for reopening the assessment u/s.147 - Accordingly, the ground No.2 raised by the assessee is hereby dismissed. Estimation of income for bogus purchases - Admittedly, we find that assessee had furnished the details of corresponding sales made out of purchases together with the stock registers and bank statements. Payments to M/s. Balaji Enterprises had been made by way of account payee cheques by the assessee. Since M/s. Balaji Enterprises was one of the concerns managed by Shri B A Desai whose bank accounts operation were found to be suspicious as detailed hereinabove, the lower authorities had doubted the veracity of transactions carried out by the assessee with M/s. Balaji Enterprises. Even though it has been recorded in the orders of the lower authorities that soon after the cheques are deposited in the bank account of M/s. Balaji Enterprises, the amounts were withdrawn in cash, there is absolutely no evidence brought on record by the lower authorities to prove that the said cash had been handed over to the assessee. There is no evidence brought on record to prove the cash trail with the purchases made by the assessee warranting making of disallowance of purchases. Assessee also had not discharged its onus beyond doubt in as much as the assessee was not able to explain as to why the notice u/s.133(6) of the Act could not be served on the addresses given by the assessee and he has also not bothered to produce any confirmation from M/s. Balaji Enterprises either during the course of assessment proceedings or during the course of appellate proceedings or even before us. We find that the primary suspicion based on the corroborative evidences gathered by DDIT Investigation Wing, Mumbai regarding the transactions of Shri B A Desai vis-à-vis M/s. Balaji Enterprises still remains. Since assessee had carried out certain purchase transactions with such suspicious parties, the onus is more on the assessee to prove that it has debited genuine expenditure in its books. It is the case of the Revenue that assessee had debited purchases from M/s. Balaji Enterprises. It is not in dispute that the corresponding sales made out of purchases together with stock register has been produced by the assessee before the lower authorities. Hence, it would be just and fair to tax only the profit element embedded in the value of such purchases. Considering the industry in which assessee is engaged, we deem it fit and appropriate to estimate such profit element at 5% of the value of purchases, which in our considered opinion, would meet the ends of justice. Appeal of the assessee is partly allowed.
|