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2020 (9) TMI 272 - ITAT CHANDIGARHValidity of the assessment framed u/s. 143(3) r.w.s. 147 - statutory notice u/s. 143(2) was not issued or served upon the assessee - HELD THAT:- So far as the mandatory requirement of issue of notice u/s. 143(2) of the Act in the case of re-assessment proceeding carried out u/s. 147 is concerned, the issue has been settled in the case of 'PCIT vs. Jai Shiv Shankar Traders Pvt. Ltd.' [2015 (10) TMI 1765 - DELHI HIGH COURT] held that the failure of the AO to issue a notice to the assessee u/s. 143(2) subsequent to the filing of the return pursuant to the notice issued u/s. 148 is fatal of the order of the re-assessment. Assessment/re-assessment framed by the AO u/s. 143(3) read with section 147 of the Act is liable to be quashed. We order accordingly. In view of this, the consequential addition pursuant to such invalid assessment framed will have no legs to stand and are accordingly ordered to be deleted. Estimation of income - addition on account of GP rate applied on alleged bogus purchases - HELD THAT:- entire details were submitted by the assessee. AO without any verification of any of the details submitted by the assessee and even without verification from the concerned seller 'M/s. Nazar Impex Pvt. Ltd.' made the additions without application of mind merely on the basis of the some investigation report from the Director General (Investigation), Mumbai which on stand-alone basis without corroboration with any of the facts of the case of the assessee cannot be made the sole basis to hold that the assessee had made bogus purchases. Assessee has demonstrated that if the alleged bogus purchases and corresponding sales are ignored or excluded, there will be a resultant loss of ₹ 20,16,844/- and under the circumstances, it cannot be said that the assessee had booked bogus purchases to reduce the profits. When the sales have been admitted and there is sufficient profit shown by the assessee on such sales and even without any iota of evidence on the file that the assessee was indulged in bogus purchases, the lower authorities were not justified in making/confirming the impugned additions. Moreover, no defect has been pointed out in the books of account of the assessee and even the books of account have not been rejected by the AO. - Decided in favour of the assessee.
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