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2018 (3) TMI 1211 - HC - Income TaxReopening of assessment - bogus payment - Held that:- AO considered the expenditure of payments made to suppliers and a dis-allowance was made to the extent of 20%, wherein money transaction was made other than by way of cheque or draft. Explanation of the assessee that the suppliers did not have access to banking facility was specifically declined noting the address of the suppliers furnished by the assessee. No further enquiry made, which is evident from the assessment order. The re-assessment was on the basis of the report of the I.T.O., Tirupur pointing out that six dealers to whom payments were said to have been made are bogus. The opinion formed for the purpose of dis-allowance to the extent of 20% was on incorrect facts and, hence, there is no infirmity in the re-assessment proceedings. There is definitely acquisition of fresh information, specific in nature and reliable in character relating to the concluded assessment in the present case. The Income Tax Officer having jurisdiction over the area in which certain dealers to whom the assessee had made payments, were situated, had made enquiries and found that they were non-existent. This information of bogus dealers as supplied by the ITO having jurisdiction over the disclosed address of the dealers, was relied on by the AO of the assessee to initiate reassessment. Non-disclosure of fully and truly of material facts required for assessment, it has to be noticed that the dealer had supplied the details of persons who were non-existent, in the returns filed. The dealer had claimed purchases from the said non-existent persons as also entered in the books of accounts payments made to them, which were also cash payments. Non-disclosure in the return, as also in the books of accounts, is insofar as the dealers having been shown as existing registered dealers to whom payments were made by the assessee in the course of their business. The non-disclosure germane to the facts herein was that the six dealers were bogus and there was in the regular assessment, no such question raised or enquiry conducted. - Decided in favour of the Revenue
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